[Federal Register Volume 76, Number 233 (Monday, December 5, 2011)]
[Proposed Rules]
[Pages 75845-75849]
[FR Doc No: 2011-31189]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2010-0483-201155; FRL-9498-8]

Approval and Promulgation of Implementation Plans; State of
Tennessee: Prevention of Significant Deterioration and Nonattainment
New Source Review Rules: Nitrogen Oxides as a Precursor to Ozone

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to approve changes to the Tennessee State
Implementation Plan (SIP), submitted by the Tennessee Department of
Environment and Conservation (TDEC) through the Division of Air
Pollution Control to EPA on May 28, 2009. The proposed SIP revision
modifies Tennessee's New Source Review (NSR) Prevention of Significant
Deterioration (PSD) and Nonattainment New Source Review (NNSR)
programs. Tennessee's May 28, 2009, SIP revision makes several changes
for which EPA is proposing approval in this rulemaking. First, the
proposed revision addresses requirements promulgated in the 1997 8-Hour
Ozone National Ambient Air Quality Standards (NAAQS) plementation Rule
NSR Update Phase II (hereafter referred to as the ``Ozone
Implementation NSR Update'' or ``Phase II Rule''). Second, the May 28,
2009, SIP revision includes updates to Tennessee's PSD and NNSR
permitting regulations regarding the addition of clean coal technology
(CCT) requirements. Lastly, the SIP revision includes clarifying
changes and corrections to portions of the Tennessee NSR rule. All
changes in the proposed SIP revision are necessary to comply with
Federal regulations related to Tennessee's NSR permitting program. EPA
is proposing approval of the May 28, 2009, proposed SIP revision
because the Agency has preliminarily determined that the changes are in
accordance with the Clean Air Act (CAA or Act) and EPA regulations
regarding NSR permitting.

DATES: Comments must be received on or before January 4, 2012.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2010-0483, by one of the following methods:
    1. http://www.regulations.gov: Follow the on-line instructions for
submitting comments.
    2. Email<EMAIL_ADDRESS>    3. Fax:<PHONE_NUMBER>.
    4. Mail: EPA-R04-OAR-2010-0483, Regulatory Development Section, Air
Planning Branch, Air, Pesticides and Toxics Management Division, U.S.
Environmental Protection Agency, Region 4, 61 Forsyth Street SW.,
Atlanta, Georgia 30303-8960.
    5. Hand Delivery or Courier: Ms. Lynorae Benjamin, Chief,
Regulatory Development Section, Air Planning Branch, Air, Pesticides
and Toxics Management Division, U.S. Environmental Protection Agency,
Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. Such
deliveries are only accepted during the Regional Office's normal hours
of operation. The Regional Office's official hours of business are
Monday through Friday, 8:30 to 4:30, excluding Federal holidays.
    Instructions: Direct your comments to Docket ID No. ``EPA-R04-OAR-
2010-0483.'' EPA's policy is that all comments received will be
included in the public docket without change and may be made available
online at http://www.regulations.gov, including any personal
information provided, unless the comment includes information claimed
to be Confidential Business Information (CBI) or other information
whose disclosure is restricted by statute. Do not submit through http://www.regulations.gov or email, information that you consider to be CBI
or otherwise protected. The http://www.regulations.gov Web site is an
``anonymous access'' system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment. If you send an email comment directly to EPA without
going through http://www.regulations.gov, your email address will be
automatically captured and included as part of the comment that is
placed in the public docket and made available on the Internet. If you
submit an electronic comment, EPA recommends that you include your name
and other contact information in the body of your comment and with any
disk or CD-ROM you submit. If EPA cannot read your comment due to
technical difficulties and cannot contact you for clarification, EPA
may not be

able to consider your comment. Electronic files should avoid the use of
special characters, any form of encryption, and be free of any defects
or viruses. For additional information about EPA's public docket visit
the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm.
    Docket: All documents in the electronic docket are listed in the
http://www.regulations.gov index. Although listed in the index, some
information is not publicly available, i.e., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, is not placed on the Internet and will be
publicly available only in hard copy form. Publicly available docket
materials are available either electronically in http://www.regulations.gov or in hard copy at the Regulatory Development
Section, Air Planning Branch, Air, Pesticides and Toxics Management
Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth
Street SW., Atlanta, Georgia 30303-8960. EPA requests that if at all
possible, you contact the person listed in the FOR FURTHER INFORMATION
CONTACT section to schedule your inspection. The Regional Office's
official hours of business are Monday through Friday, 8:30 to 4:30,
excluding Federal holidays.

FOR FURTHER INFORMATION CONTACT: For information regarding the
Tennessee SIP, contact Ms. Twunjala Bradley, Regulatory Development
Section, Air Planning Branch, Air, Pesticides and Toxics Management
Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth
Street SW., Atlanta, Georgia 30303-8960. Telephone number: (404) 562-
9352; email address<EMAIL_ADDRESS>For information
regarding NSR, contact Ms. Yolanda Adams, Air Permits Section, at the
same address above. Telephone number:<PHONE_NUMBER>; email address:
<EMAIL_ADDRESS>For information regarding 8-hour ozone NAAQS,
contact Ms. Jane Spann, Regulatory Development Section, at the same
address above. Telephone number:<PHONE_NUMBER>; email address:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Table of Contents

I. What action is EPA proposing?
II. What is the background for EPA's proposed action?
    A. What is the NSR program?
    B. What are the NSR requirements for the Phase II Rule?
III. What is EPA's analysis of Tennessee's SIP revision?
    A. EPA's Analysis of Tennessee's NSR Rule Revision To Adopt the
Phase II Rule Requirements
    B. EPA's Analysis of Tennessee's Inclusion of Certain Clean Coal
Technology Changes
    C. EPA's Analysis of Tennessee's Clarifying Changes and
Corrections
IV. Proposed Action
V. Statutory and Executive Order Reviews

I. What action is EPA proposing?

    On May 28, 2009, TDEC submitted a revision to EPA for approval into
the Tennessee SIP to adopt Federal requirements for NSR permitting.\1\
Tennessee's SIP revision makes changes to Tennessee's Air Quality
Regulations, Chapter 1200-03-09--Construction and Operating Permits,
Rule Number .01--Construction Permit, .02--Operating Permits, and .03--
General Provisions to adopt PSD and NNSR requirements related to the
implementation of the Phase II Rule.\2\ First, the proposed revision
addresses requirements promulgated in the Phase II Rule. In summary,
the May 28, 2009, SIP revision addresses the Ozone Implementation NSR
Update requirements for Tennessee to: (1) Specifically recognize that
nitrogen oxides (NOX) emissions are ozone precursors; (2)
adopt NNSR provisions for major stationary source thresholds for
sources in certain classes of nonattainment areas for 8-hour ozone,
carbon monoxide and particulate matter with a nominal aerodynamic
diameter less than or equal to 10 microns (PM10); (3)
address changes to offset ratios for marginal, moderate, serious,
severe, and extreme ozone nonattainment areas; and (4) address changes
to provisions addressing offset requirements for facilities that shut
down or curtail operation. Tennessee's May 28, 2009 submittal adopts
these provisions promulgated in the Phase II Rule. In addition, May 28,
2009, SIP revision includes updates to the Tennessee PSD and NNSR
permitting regulations regarding the adoption of CCT definitions at
1200-03-09.01. Lastly, the SIP revision includes clarifying changes and
corrections to its rules at 1200-3-9-.01, 1200-3-9-.02 and 1200-3-
9-.03. All changes in the proposed SIP revision are necessary to comply
with Federal regulations related to Tennessee's NSR permitting program.
Pursuant to section 110 of the CAA, EPA is proposing to approve all the
aforementioned changes into the Tennessee SIP.
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    \1\ Tennessee's May 28, 2009, SIP revision also contained
changes to Tennessee's SIP-approved NSR permitting regulations
regarding ``baseline actual emissions.'' EPA is not proposing action
for this revision at this time.
    \2\ Tennessee's May 28, 2009 SIP submittal also made changes to
the State's title V regulations at 1200-3-9-.02(11) which EPA is not
proposing action as these regulations are not part of the SIP.
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    Tennessee's May 28, 2009, submittal also included the removal of
provisions for clean units (CU) and pollution control projects (PCP)
from the State's PSD and NNSR regulations that were vacated by the
United States Court of Appeals for the District of Columbia Circuit (DC
Circuit Court) \3\ to be consistent with the Federal regulations. EPA
did not approve revisions into Tennessee's federally-approved SIP
regarding the provisions for CU and PCP. Therefore, no action related
to the provisions of CU and PCP is necessary.
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    \3\ On December 31, 2002, (67 FR 80186), EPA published final
rule changes to 40 CFR parts 51 and 52, regarding the CAA's PSD and
NNSR programs. On November 7, 2003, (68 FR 63021), EPA published a
notice of final action on the reconsideration of the December 31,
2002, final rule changes. The December 31, 2002, and the November 7,
2003, final actions are collectively referred to as the ``2002 NSR
Reform Rules.'' On June 24, 2005, DC Circuit Court vacated portions
of the 2002 NSR Reform Rules pertaining to CU and PCP.
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II. What is the background for EPA's proposed action?

A. What is the NSR program?

    The CAA NSR program is a preconstruction review and permitting
program applicable to certain new and modified stationary sources of
air pollutants regulated under the CAA. The program includes a
combination of air quality planning and air pollution control
technology requirements. The CAA NSR program is composed of three
separate programs: PSD, NNSR, and Minor NSR. PSD is established in Part
C of title I of the CAA and applies in areas that meet the NAAQS
``attainment areas'' as well as areas where there is insufficient
information to determine if the area meets the NAAQS--``unclassifiable
areas.'' The NNSR program is established in Part D of title I of the
CAA and applies in areas that are not in attainment of the NAAQS--
``nonattainment areas.'' The minor NSR program addresses construction
or modification activities that do not qualify as ``major'' and applies
regardless of the designation of the area in which a source is located.
Together, these programs are referred to as NSR programs. EPA
regulations governing the implementation of these programs are
contained in 40 Code of Federal Regulations (CFR) parts 51.165, 51.166,
52.21, 52.24, and part 51, Appendix S.
    Section 109 of the CAA requires EPA to promulgate a primary NAAQS
to protect public health and a secondary NAAQS to protect public
welfare. Once

EPA sets those standards, states must develop, adopt, and submit a SIP
to EPA for approval that includes emission limitations and other
control measures to attain and maintain the NAAQS. See CAA section 110.
Each SIP is also required to include a preconstruction review program
for the construction and modification of any stationary source of air
pollution to assure the maintenance of the NAAQS. The May 28, 2009, SIP
submittal changes Tennessee's PSD and NNSR programs.

B. What are the NSR requirements for the Phase II Rule?

    Today's proposed action on the Tennessee SIP relates in part to
EPA's Phase II Rule. 70 FR 71612 (November 29, 2005). In the Phase II
Rule, EPA made a number of changes including: recognizing
NOX as an ozone precursor for PSD purposes; changes to the
NNSR rules establishing major stationary thresholds (marginal,
moderate, serious, severe, and extreme NAA classifications) and
significant emission rates for the 8-hour ozone, PM10 and carbon
monoxide NAAQS; revised the criteria for crediting emission reductions
credits from operation shutdowns and curtailments as offsets, and
changes to offset ratios for marginal, moderate, serious, severe, and
extreme ozone NAA. EPA finalized regulations to address permit
requirements for the 1997 8-hour ozone NAAQS to implement the NSR
program by specifically identifying NOX as an ozone
precursor.
    On July 18, 1997, EPA promulgated a revised 8-hour ozone NAAQS of
0.08 parts per million--also referred to as the 1997 8-hour ozone
NAAQS. On April 30, 2004, EPA designated areas as attainment,
nonattainment and unclassifiable for the 1997 8-hour ozone NAAQS. As
part of the framework to implement the 1997 8-hour ozone NAAQS, EPA
promulgated an implementation rule in two phases. Phase I of EPA's 1997
8-hour ozone implementation rule (Phase I Rule), published on April 30,
2004, effective on June 15, 2004, provided the implementation
requirements for designating areas under subpart 1 and subpart 2 of the
CAA (69 FR 23951).
    On November 29, 2005, EPA promulgated the second phase for
implementation provisions related to the 1997 8-hour ozone NAAQS--also
known as the Phase II Rule (70 FR 71612). The Phase II Rule addressed
control and planning requirements as they applied to areas designated
nonattainment for the 1997 8-hour ozone NAAQS such as reasonably
available control technology, reasonably available control measures,
reasonable further progress, modeling and attainment demonstrations and
NSR, and the impact to reformulated gas for the 1997 8-hour ozone NAAQS
transition. The Phase II Rule requirements include, among other
changes, a provision stating that NOX is an ozone precursor.
70 FR 71612, 71679. In the Phase II Rule, EPA stated as follows:

    ``The EPA has recognized NOX as an ozone precursor in
several national rules because of its contribution to ozone
transport and the ozone nonattainment problem. The EPA's recognition
of NOX as an ozone precursor is supported by scientific
studies, which have long recognized the role of NOX in
ozone formation and transport. Such formation and transport is not
limited to nonattainment areas. Therefore, we believe NOX
should be treated consistently as an ozone precursor in both our PSD
and nonattainment NSR regulations. For these reasons, we have
promulgated final regulations providing that NOX is an
ozone precursor in attainment areas.''

    As was discussed earlier, the Phase II Rule made changes to Federal
regulations at 40 CFR 51.165 and 51.166 (which governs the NNSR and PSD
permitting programs respectively). Pursuant to these requirements,
states were required to submit SIP revisions adopting the relevant
Federal requirements of the Phase II Rule (at 40 CFR 51.165 and 51.166)
into their SIP no later than June 15, 2007. On May 28, 2009, Tennessee
submitted a SIP revision (the subject of this action) to adopt the
relevant provisions at 40 CFR 51.165 and 51.166 into the Tennessee SIP
to be consistent with Federal regulations for NSR permitting purposes
promulgated in the Phase II Rule.

III. What is EPA's analysis of Tennessee's SIP revision?

    Tennessee currently has a SIP-approved NSR program for new and
modified stationary sources. TDEC's PSD preconstruction rules are found
in Rule 1200-3-9-.01(4) and apply to major stationary sources or
modifications constructed in areas designated attainment as required
under part C of title I of the CAA with respect to the NAAQS. TDEC's
Rule 1200-3-9-.01(5) includes permitting requirements for sources in
and impacting nonattainment areas. Today, EPA is proposing to approve
changes to Tennessee's rules at 1200-3-9-.01(4) and at 1200-3-9-.01(5)
to update the State's existing NSR program to be consistent with
Federal NSR regulations, amended in the Phase II Rule (at 40 CFR 51.165
and 51.166). Lastly, EPA is proposing to approve Tennessee's clarifying
changes and corrections to its rules at 1200-3-9-.01, 1200-3-9-.02 and
1200-3-9-.03. More detail is provided below regarding EPA's analysis of
the changes to Tennessee's SIP as provided in the May 28, 2009, SIP
revision.

A. EPA's Analysis of Tennessee's NSR Rule Revision To Adopt the Phase
II Rule Requirements

    Tennessee's May 28, 2009, SIP revision included changes to the
State's PSD and NNSR programs to address EPA's Phase II Rule. As part
of its review of the Tennessee submittal, EPA performed a line-by-line
review of the proposed revision including the provision which differs
from the Federal rules, and determined that they are consistent with
the program requirements for NSR, set forth at 40 CFR 51.165 and
51.166. States may meet the requirements of 40 CFR part 51 and the
Phase II Rules with alternative but equivalent regulations. Tennessee
adopted the Federal PSD and NNSR rules amended in the Phase II Rules
with minor NNSR variations.
    Specifically, with regards to the permit requirements for NNSR
NOX as an ozone precursor, Tennessee's SIP revision did not
specifically include the NNSR provisions at 40 CFR 51.165(a)(1)(v)(E)
and 51.165(a)(1)(x)(C). See Phase II Rule at 70 FR 71612 (November 29,
2005). The Federal regulations at 40 CFR 51.165(a)(1)(v)(E) and
(a)(1)(x)(C) relate to applying the same volatile organic compound
(VOC) emission requirements for significant net emissions and emission
rates (respectively) to NOX emissions of major stationary
sources and major modifications. However, Tennessee's NSR program has
equivalent provisions that address both of the aforementioned Phase II
Rule requirements. Tennessee's existing SIP includes the definition of
``ozone precursor'' at 1200-03-09-.01(5)(b)1(xxxiii). Ozone precursor
is defined in Tennessee's SIP as VOC and/or NOX. Also,
Tennessee's SIP defines ``regulated NSR pollutant'' as ``VOC and/or
nitrogen oxides compound (1200-03-09-.01(5)(b)(1)(xlix).'' Tennessee's
definition for ``major modification'' (at 1200-03-09-.01(5)(b)1(v))
states that ``any significant emissions increase from any emissions
units or emission increase at a major stationary source that is
significant for volatile organic compounds and/or nitrogen oxides shall
be considered significant for ozone.''
    In addition, Tennessee's May 28, 2009, SIP revision does not
explicitly include the Phase II Rule provision at
51.165(a)(1)(iv)(A)(2) which addresses the applicability of
NOX as an ozone

precursor to major stationary source emission thresholds in
nonattainment areas (based on classifications).\4\ However, EPA
believes that Tennessee's SIP already covers the requirement of
51.165(a)(1)(iv)(A)(2) because: (1) The definition of a ``major
stationary source'' (1200-03-09-.01(5)(b)(1)(iv)) in the Tennessee SIP
addresses major stationary source thresholds for NOX for
moderate nonattainment areas (which was the highest nonattainment
classification in the State), and (2) Tennessee's SIP recognizes
NOX as a regulated NSR pollutant.
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    \4\ At the time of the May 28, 2009, SIP revision, Tennessee's
highest ozone nonattainment classification was moderate.
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    EPA has preliminarily determined that the rules adopted by
Tennessee in the May 28, 2009, SIP revision are at least as stringent
as the Federal program. Therefore, EPA has preliminarily determined
that Tennessee's May 28, 2009, SIP revision is consistent with the NSR
permit program requirements set forth at 40 CFR 51.165 and 51.166.

B. EPA's Analysis of Tennessee's Inclusion of Certain Clean Coal
Technology Changes

    In addition to adopting the Federal rules consistent with the Phase
II Rule, Tennessee's SIP revision also includes changes that were
promulgated by EPA in a portion of the 1992 WEPCO Rule (Wisconsin
Electric Power Co. v. Reilly, 893 F.2d 901 (7th Cir. 1990)) on July 21,
1992 (57 FR 32314). The portion of the WEPCO Rule relevant to today's
proposal, regards the establishment of CCT and re-powering projects and
the applicability of NSR requirements to such projects. As part of the
WEPCO Rule, EPA established definitions for CCT, CCT demonstration
project, temporary CCT demonstration project, and re-powering. In
addition, the rule exempted CCT demonstration projects (that constitute
re-powering) from PSD requirements (major modification) as long as the
projects do not cause an increase in potential to emit of a regulated
NSR pollutant emitted by the unit.
    Tennessee's May 28, 2009, SIP submittal revised Tennessee's NSR
regulations at 1200-03-09-.01 to adopt the CCT and repowering
definitions promulgated as part of the WEPCO Rule and now found at 40
CFR 51.165(a)(1)(xxii)-(xxiv) and 51.166(b)(33)-(36) as well as modify
the definition of ``major modification'' to exempt ``clean coal
technology demonstration projects'' (consistent with
51.165(a)(1)(v)(C)(9) and 51.166(b)(2)(iii)((i)-(j). EPA has
preliminarily determined that the rule changes made by Tennessee are
consistent with the current Federal regulations at 40 CFR 51.165 and
51.166.

C. EPA's Analysis of Tennessee's Clarifying Changes and Corrections

    In addition to the adoption of specific Federal regulations
mentioned above, TDEC is also making clarifying changes and corrections
to its SIP for portions of Rules 1200-3-9-.01, 1200-3-9-.02 and 1200-
03-09-.03. As a result of the removal of all references to the ``clean
units'' language (due to the vacatur), Tennessee, were appropriate,
replaced the terms ``clean units'' or ``clean'' with the terms ``new
emission units'' or ``new'' at Rule 1200-3-9-.01 consistent with the
hybrid test applicability provision amended in the 2002 NSR Reform
Rule. 67 FR 8018 at 80260). In addition, Tennessee is correcting a
typographical error for the definition of ``major stationary source''
at Rule 1200-3-0-.01(5)(b)(i)1(iv)(II) by removing the ``s'' from the
word ``items'' between the word ``under and before numerical (``iv).''
For rule 1200-3-9-.02--``Operating Permits,'' Tennessee is revising
paragraph (1) to clarify the timeframe and conditions for an air
contaminant source (constructed or modified in accordance with Rule
1200-3-9-.01) to apply for an operating permit. Additionally, Tennessee
is also correcting a typographical error at Paragraph 1 of Rule 1200-3-
9-.03(1) which describes the authority of the State to requests an
early timeframe for sources to comply with emission regulations
stipulated in the Tennessee SIP. This correction at 1200-03-09-.03
replaces the word ``data'' with ``date.''

IV. Proposed Action

    EPA is proposing to approve Tennessee's May 28, 2009, SIP revision
adopting Federal regulations amended in the Phase II Rule (including
recognition of NOX as an ozone precursor) into the Tennessee
SIP. Additionally, EPA is proposing to approve Tennessee's changes to
its PSD and NNSR permitting regulations regarding the addition of CCT
requirements (established in a portion of EPA's WEPCO Rule) at 1200-03-
09.01; and the clarifying changes and correction to Tennessee's NSR
rule. EPA has made the preliminary determination that this SIP revision
is approvable because it is in accordance with the CAA and EPA
regulations regarding NSR permitting.

V. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP
submission that complies with the provisions of the Act and applicable
Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in
reviewing SIP submissions, EPA's role is to approve state choices,
provided that they meet the criteria of the CAA. Accordingly, this
proposed action merely approves state law as meeting Federal
requirements and does not impose additional requirements beyond those
imposed by state law. For that reason, this proposed action:
     Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Order
12866 (58 FR 51735, October 4, 1993);
     Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
     Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, this proposed rule does not have tribal implications
as specified by Executive Order 13175 (65 FR 67249, November 9, 2000),
because the SIP is not approved to apply in Indian country located in
the state, and EPA notes that it will not impose substantial direct
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental
relations, Ozone, Nitrogen oxides, Recordkeeping and reporting,
Volatile organic compounds.

    Authority: 42 U.S.C. 7401 et seq.

    Dated: November 22, 2011.
A. Stanley Meiburg,
Acting Regional Administrator, Region 4.
[FR Doc. 2011-31189 Filed 12-2-11; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register Volume 88, Number 83 (Monday, May 1, 2023)]
[Proposed Rules]
[Page 26514]
[FR Doc No: C1-2023-06504]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 181

46 CFR Parts 25, 28, 108, 117, 133, 141, 160, 169, 180 and 199

[Docket No. USCG-2022-0120]
RIN 1625-AC62

Lifejacket Approval Harmonization

Correction

    In proposed rule document 2023-06504, appearing on pages 21016-
21058 in the issue of Friday, April 7, 2023, make the following
correction:

Sec.  160.060-15  [Corrected]

0
On page 21050, in the second column, in paragraph (e)(2), in the third
and fourth lines, ``not less than 151 2044;2 pounds of buoyancy in
fresh water'' is corrected to read ``not less than 15\1/2\ pounds of
buoyancy in fresh water''.

[FR Doc. C1-2023-06504 Filed 4-28-23; 8:45 am]
BILLING CODE 0099-10-P


Comment Info: =================

General Comment:SUPPLEMENTAL MATERIALS:

Notice of additional meetings of the Oil Spill Response Plan Negotiated Rulemaking Committee

PAGES:  1


[Federal Register Volume 86, Number 104 (Wednesday, June 2, 2021)]
[Notices]
[Page 29572]
[FR Doc No: 2021-11577]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. RP21-838-000]

Occidental Permian Ltd., OXY USA WTP LP v. El Paso Natural Gas
Company, LLC; Notice of Complaint

    Take notice that on May 24, 2021, pursuant to Section 5 of the
Natural Gas Act \1\ and Rule 206 of the Federal Energy Regulatory
Commission's (Commission) Rules of Practice and Procedure, 18 CFR
385.206 (2021), Occidental Permian Ltd. and OXY USA WTP LP
(Complainants) filed a formal complaint against El Paso Natural Gas
Company, LLC (Respondent), alleging that the Respondent's failure to
waive and imposition of Critical Operating Condition charges and
penalties for the period February 15, 2021 through February 17, 2021 is
unjust and unreasonable, unreasonably punitive, and inconsistent with
Commission policy and precedent, all as more fully explained in its
complaint.
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    \1\ 15 U.S.C. 717d.
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    The Complainants certify that copies of the complaint were served
on the contacts listed for Respondent in the Commission's list of
Corporate Officials.
    Any person desiring to intervene or to protest this filing must
file in accordance with Rules 211 and 214 of the Commission's Rules of
Practice and Procedure (18 CFR 385.211, 385.214). Protests will be
considered by the Commission in determining the appropriate action to
be taken, but will not serve to make protestants parties to the
proceeding. Any person wishing to become a party must file a notice of
intervention or motion to intervene, as appropriate. The Respondent's
answer and all interventions, or protests must be filed on or before
the comment date. The Respondent's answer, motions to intervene, and
protests must be served on the Complainant.
    The Commission strongly encourages electronic filings of comments,
protests and interventions in lieu of paper using the ``eFiling'' link
at http://www.ferc.gov. Persons unable to file electronically may mail
similar pleadings to the Federal Energy Regulatory Commission, 888
First Street NE, Washington, DC 20426. Hand delivered submissions in
docketed proceedings should be delivered to Health and Human Services,
12225 Wilkins Avenue, Rockville, Maryland 20852.
    In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
internet through the Commission's Home Page (http://www.ferc.gov) using
the ``eLibrary'' link. Enter the docket number excluding the last three
digits in the docket number field to access the document. At this time,
the Commission has suspended access to the Commission's Public
Reference Room, due to the proclamation declaring a National Emergency
concerning the Novel Coronavirus Disease (COVID-19), issued by the
President on March 13, 2020. For assistance, contact the Federal Energy
Regulatory Commission at<EMAIL_ADDRESS>or call toll-free,
(886) 208-3676 or TYY,<PHONE_NUMBER>.
    Comment Date: 5:00 p.m. Eastern Time on June 14, 2021.

    Dated: May 26, 2021.
Debbie-Anne A. Reese,
Deputy Secretary.
[FR Doc. 2021-11577 Filed 6-1-21; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 86, Number 41 (Thursday, March 4, 2021)]
[Notices]
[Pages 12762-12769]
[FR Doc No: 2021-04428]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-91223; File No. SR-ISE-2021-01]

Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend Various
Rules in Options 3 and Options 5

February 26, 2021.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on February 18, 2021, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed
with the Securities and Exchange Commission (``SEC'' or ``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.
---------------------------------------------------------------------------

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

    The Exchange proposes to amend various rules in Options 3 and
Options 5.
    The text of the proposed rule change is available on the Exchange's
website at https://listingcenter.nasdaq.com/rulebook/ise/rules, 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 Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

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

1. Purpose
    The purpose of the proposed rule change is to amend various rules
in Options 3 and Options 5. The proposed changes consist of conforming
existing rules to current System technology, amending rule text to add
greater detail on how certain Exchange functionality operate today, and
conforming language within the Exchange's rules to the rules of other
exchanges. As such, no System changes to existing functionality are
being made pursuant to this proposal. Rather, this proposal is designed
to reduce any potential investor confusion as to the features and
applicability of certain functionality presently available on the
Exchange. These changes are described in detail below, and include
amending Exchange rules governing: (1) The Block Order Mechanism
(``Block''),\3\ (2) the Facilitation Mechanism (``Facilitation''),\4\
(3) the Solicited Order Mechanism (``Solicitation''),\5\ (4) the Price
Improvement Mechanism (``PIM''),\6\ (5) Trade Value Allowance
(``TVA''),\7\ (6) Anti-Internalization,\8\ and (7) the exposure
mechanism (``Exposure'').\9\
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    \3\ See Options 3, Section 11(a).
    \4\ See Options 3, Section 11(b).
    \5\ See Options 3, Section 11(d).
    \6\ See Options 3, Section 13.
    \7\ See Supplementary Material .03 to Options 3, Section 14.
    \8\ See Options 3, Section 15(a)(3)(A).
    \9\ See Supplementary Material .02 to Options 5, Section 2.
---------------------------------------------------------------------------

Universal Changes
    In September 2019, the Exchange amended its regular allocation rule
in Options 7, Section 10 (Priority of Quotes and Orders) to make non-
substantive changes, among other changes, to replace references to
Professional interest with non-Priority Customer interest.\10\ The
Exchange now proposes to make similar changes to replace all instances
of ``Professional'' interest with ``non-Priority Customer'' interest
throughout its auction allocation rules in Options 3, Section 11 and
Section 13 to align with the changes made in SR-ISE-2019-21.\11\ While
the term ``Professional Orders'' is defined within Options 1, Section
1(a)(39) as an order that is for the account of a person or entity that
is not a Priority Customer, the Exchange believes that using the term
``non-Priority Customer'' is more clear in describing the types of
market participant to which the allocation applies, and also reduces
confusion regarding any reference to Professional Orders or
Professional Customer orders.
---------------------------------------------------------------------------

    \10\ See Securities Exchange Act Release No. 86947 (September
12, 2019), 84 FR 49165 (September 18, 2019) (SR-ISE-2019-21).
    \11\ Specifically in Options 3, Section 11, the Exchange will
amend current subsections (a)(2)(B), (b)(3)(A)-(C) (renumbered to
(b)(4)(A)-(C) under this proposal), (c)(7)(A)-(C), (d)(2)(C)
(renumbered to (d)(3)(C) under this proposal), and (e)(4)(D). In
Options 3, Section 13, the Exchange will amend current subsections
(d)(1)-(3) and (e)(5)(i)-(iii).
---------------------------------------------------------------------------

    In addition, the Exchange proposes to make universal changes in its
Facilitation and Solicitation rules \12\ to clearly delineate between
orders and Responses \13\ of the same capacity. For example, where the
existing rule text currently states ``Priority Customer bids
(offers),'' the Exchange proposes instead to state ``Priority Customer
Orders and Priority Customer Responses to buy (sell).'' The Exchange
notes that this is merely a non-substantive change as auction orders
and Responses of the same capacity do not get treated differently for
allocation purposes today. The rules for complex Facilitation and
Solicitation already distinguish between orders and Responses, so the
Exchange is simply amending those complex rules to clearly state how,
for example, Priority Customer Complex Orders and Priority Customer
Responses get allocated today \14\ With the proposed changes, the
Exchange seeks to include a similar level of detail within its simple
and complex Facilitation and Solicitation rules in order to bring
transparency

around how allocation takes place in those auction mechanisms today.
---------------------------------------------------------------------------

    \12\ Specifically in Options 3, Section 11, subsections
(b)(3)(A)-(C) (renumbered to (b)(4)(A)-(C)), and (d)(2)(A) and (C)
(renumbered to (d)(3)(A) and (C)) will be updated.
    \13\ A ``Response'' is an electronic message that is sent by
Members in response to a broadcast message. See Options 3, Section
11.
    \14\ See Options 3, Section 11(c)(7) and (e)(4).
---------------------------------------------------------------------------

Block Order Mechanism
    The Exchange proposes minor changes to the current descriptions of
the Block execution and allocation process in Options 3, Section 11(a).
As discussed below, the proposed Block changes are non-substantive in
nature, and are intended to harmonize with the Block rule on its
affiliated market, BX Options (``BX'') in order to ensure rule
consistency between the Exchange and its affiliate offering identical
functionality.
    First, the Exchange proposes to add ``up to the size of the block
order'' at the end of subsection (a)(2)(A). As amended, the rule will
provide that bids (offers) on the Exchange at the time the block order
is time the block order is executed that are priced higher (lower) than
the block execution price, as well as Responses that are priced higher
(lower) than the block execution price, will be executed in full at the
block execution price up to the size of the block order. The Exchange
is making this non-substantive change to align with BX's Block
rule,\15\ which will ensure rule consistency for identical
functionality across affiliated markets. The language states that
better priced interest gets executed in full only if there is
sufficient size to execute against such interest, which is how block
orders are executed and priced on the Exchange and BX today.
---------------------------------------------------------------------------

    \15\ See BX Options 3, Section 11(a)(2)(A).
---------------------------------------------------------------------------

    Second, the Exchange proposes a non-substantive change in the first
sentence of subsection (a)(2)(B) to replace ``first and in time
priority'' with ``first in price time priority.'' As amended, the rule
will provide that at the block execution price, Priority Customer
Orders and Priority Customer Responses will be executed first in price
time priority. This is not a change to the current Block allocation
methodology, but rather a non-substantive change for better
readability, and to align with BX's Block rule \16\ in order to ensure
rule consistency for identical functionality across affiliated markets.
Block orders will continue to trade at a single execution price that
allows the maximum number of contracts of the block order to be
executed against both the Responses entered to trade against the order
and unrelated interest on the Exchange's order book.
---------------------------------------------------------------------------

    \16\ See BX Options 3, Section 11(a)(2)(B).
---------------------------------------------------------------------------

Example 1

Block order is entered to buy 50 contracts @1.50

    The following Responses are received:
Priority Customer Response 1 to sell 40 contracts @1.40
Priority Customer Response 2 to sell 10 contracts @1.40
Priority Customer Response 3 to sell 10 contracts @1.39

    The block execution price would be $1.40 (i.e., the price at
which the maximum number of contracts could be executed) and would
be executed as follows:

Block order trades 10 with Priority Customer Response 3 @1.40
Block order trades 40 with Priority Customer Response 1 @1.40

    As shown above, Priority Customer Response 3 would be executed in
full since it is priced better than the block execution price and there
is sufficient size to execute Response 3 against the block order, while
Priority Customer Responses 1 and 2, which are priced at the block
execution price, would participate in price time priority--i.e., the
remaining 40 contracts would go to Response 1, which was received
before Response 2.
Facilitation Mechanism
    The Exchange proposes a number of changes to its Facilitation rule,
none of which will change the current operation of this technology
offering. Many of the proposed changes are intended to align the simple
Facilitation rule in Options 3, Section 11(b) with the complex
Facilitation rule in Options 3, Section 11(c) where relevant. In
October 2018, the Exchange amended its complex order rules to provide
greater clarity and additional detail regarding the operation and
applicability of complex order functionality, including complex auction
mechanisms like complex Facilitation.\17\ Accordingly, the Exchange
seeks to make aligning changes and update its simple auction mechanism
rules to similarly provide the level of detail that now exists in its
complex auction mechanism rules. The proposed changes are also intended
to align with the simple Facilitation rules of the Exchange's
affiliated markets, Nasdaq GEMX (``GEMX'') and Nasdaq MRX (``MRX'').
The Exchange also proposes to more accurately describe how orders will
be allocated in Facilitation's ``auto-match'' functionality.
---------------------------------------------------------------------------

    \17\ See Securities Exchange Act Release No. 84373 (October 5,
2018), 83 FR 51730 (October 12, 2018) (SR-ISE-2018-56) (``Complex
Order Filing''). As discussed later in this filing, the Complex
Order Filing also clarified the Exchange's complex Solicitation and
PIM rules, and the Exchange is proposing to align the simple
Solicitation and PIM rules with the complex rules where possible.
---------------------------------------------------------------------------

    In Options 3, Section 11(b), the Exchange proposes to add new
subsection (b)(1),\18\ which will provide that Orders must be entered
into the Facilitation Mechanism at a price that is (A) equal to or
better than the NBBO on the same side of the market as the agency order
unless there is a Priority Customer order on the same side Exchange
best bid or offer, in which case the order must be entered at an
improved price; and (B) equal to or better than the ABBO \19\ on the
opposite side. Orders that do not meet these requirements are not
eligible for the Facilitation Mechanism and will be rejected. The
Exchange is not proposing any other changes to the current entry
requirements for Facilitation. The new subsection (b)(1) would simply
provide additional detail about simple Facilitation's existing entry
checks, and align to the level of detail currently within the complex
Facilitation rule regarding entry checks.\20\
---------------------------------------------------------------------------

    \18\ As a result, current subsections (b)(1)--(3) will be
renumbered as (b)(2)--(4). The Exchange will also renumber current
subsection (b)(3)(D) as subsection (b)(5).
    \19\ The term ``Away Best Bid or Offer'' or ``ABBO'' means the
displayed National Best Bid or Offer not including the Exchange's
Best Bid or Offer. See Options 1, Section 1(a)(4).
    \20\ See Options 3, Section 11(c)(1) and (c)(2). Complex
Facilitation refers to the Exchange's best bid or offer instead of
the NBBO or ABBO. There is no NBBO for complex orders as complex
orders may be executed without consideration of any prices that
might be available on other exchanges trading the same options
contracts. See Options 3, Section 14(d). Additionally, executions of
legs of complex orders are exceptions to the prohibition on trade-
throughs. See Options 5, Section 2(b)(7).
---------------------------------------------------------------------------

Example 2

    Assume the following market:

ISE BBO: 1 x 2 (also NBBO)
CBOE: 0.75. *times; 2.25 (next best exchange quote)
Facilitation order is entered to buy 50 contracts @2.05

    No Responses are received.

The Facilitation order executes with resting 50 lot quote @2. In this
instance, the Facilitation order is able to begin crossed with the
contra side ISE BBO because in execution, the resting 50 lot quote @2
is able to provide price improvement to the facilitation order.
    In renumbered subsection (b)(2), the Exchange proposes to add
language to describe the content of the broadcast message sent to
Members upon entry of an order into simple Facilitation. In particular,
the Exchange proposes to specify that the broadcast message includes
the series, price and size of the Agency Order, and whether it is to
buy or sell. Although this change reflects current functionality, the
existing rule is silent in this regard and only indicates that a
broadcast message is sent upon the order's entry into the mechanism.

Identical language currently exists in the rules governing simple
Facilitation on GEMX and MRX, which operate in the same way as ISE's
simple Facilitation.\21\
---------------------------------------------------------------------------

    \21\ See GEMX and MRX Options 3, Section 11(b)(1).
---------------------------------------------------------------------------

    In renumbered subsection (b)(3), the Exchange proposes to replace
the words ``must not exceed'' with ``will only be considered up to'' in
order to align with identical language in the complex Facilitation
rule.\22\ This change more accurately describes that the System will
cap Responses to the size of the auction for purposes of allocation
methodology.
---------------------------------------------------------------------------

    \22\ See Options 3, Section 11(c)(6).
---------------------------------------------------------------------------

    In renumbered subsection (b)(4)(A), the Exchange proposes to
provide that the facilitation order will be cancelled at the end of the
exposure period if an execution would take place at a price that is
inferior to the best bid (offer) on the Exchange. This is a non-
substantive change that makes clear that any executions in Facilitation
will comply with the general prohibition on trade-throughs in Options
5, Section 2(a). Identical language is included in the rules governing
simple Facilitation on GEMX and MRX.\23\
---------------------------------------------------------------------------

    \23\ See GEMX and MRX Options 3, Section 11(b)(3).
---------------------------------------------------------------------------

    In renumbered subsections (b)(4)(B) and (b)(4)(C), the Exchange
proposes to amend the rule to provide that the facilitating Member will
be allocated up to forty percent (40%) (or such lower percentage
requested by the Member) of the original size of the facilitation
order. If the Member requests a lower allocation percentage, the
contra-side order would receive an allocation consistent with the
percentage requested by the Member. Regardless of the Member's request,
the contra-side order would still be responsible for executing up to
the full size of the agency order if there is not enough interest to
execute the agency order at a particular price. Similar language
indicating that the Member may request a lower allocation percentage
than 40% is currently included in the complex Facilitation rule, which
operate in the same way as the simple Facilitation in this manner.\24\
For greater consistency between its simple and complex Facilitation
rules, the Exchange also proposes to make aligning, non-substantive
changes in the complex Facilitation rule to provide that the Member
will ``be allocated up to'' forty percent. The current complex
Facilitation language provides that the Member will ``execute at least
forty percent'' or that the Member will ``be allocated at least forty
percent.'' \25\ The non-substantive language proposed for complex
Facilitation will therefore serve to harmonize the complex rule with
the amended simple rule.
---------------------------------------------------------------------------

    \24\ See Options 3, Section 11(c)(7)(B) and (C). Other options
exchanges such as BX provide similar functionality that allows
members using an auction mechanism to configure allocation priority.
See, e.g., BX Options 3, Section 13, which provides a similar
feature for the BX Options Price Improvement Auction (``PRISM'')
called ``Surrender.''
    \25\ Id.
---------------------------------------------------------------------------

    The Exchange also proposes to more accurately describe
Facilitation's auto-match functionality, which provides an enhanced
price improvement opportunity for the agency order by permitting the
contra-side order to further participate in the cross by auto-matching
the price and size of competing interest providing price improvement
from other market participants.\26\ The rule currently provides that
upon entry of an order into the Facilitation Mechanism, the
facilitating Electronic Access Member can elect to automatically match
the price and size of orders, quotes and responses received during the
exposure period up to a specified limit price or without specifying a
limit price. In this case, the facilitating Electronic Access Member
will be allocated its full size at each price point, or at each price
point within its limit price is a limit is specified, until a price
point is reached where the balance of the order can be fully
executed.\27\ The Exchange proposes to state that if a Member elects to
auto-match, the facilitating Electronic Access Member will be allocated
the aggregate size of all competing quotes, orders, and Responses
(instead of ``its full size'') at each price point, or at each price
point up to the specified limit price (instead of ``within its limit
price'') if a limit is specified, until a price point is reached where
the balance of the order can be fully executed. The Exchange believes
that the modified language more accurately explains how the
functionality works today, and better aligns with how this feature is
described in the Auto-Match Filing.\28\ For greater consistency within
its Rulebook, the Exchange will also make the same changes in the
complex Facilitation auto-match rule in Options 3, Section 11(c)(7)(C).
---------------------------------------------------------------------------

    \26\ See Securities Exchange Act Release No. 62644 (August 4,
2010), 75 FR 48395 (August 10, 2010) (SR-ISE-2010-61) (``Auto-Match
Filing''). As discussed later in this filing, the Auto-Match Filing
also introduced the auto-match feature on PIM. As such, the Exchange
is proposing to make similar changes in PIM's auto-match rule as
proposed for Facilitation's auto-match rule.
    \27\ See Options 3, Section 11(b)(3)(C) (renumbered to Section
11(b)(4)(C) under this proposal).
    \28\ The Auto-Match Filing describes the auto-match feature as
allowing the initiating member to submit a contra-side order that
will automatically match the price and size set forth by the
competing interest from other market participants (i.e., auction
responses, quotes, and orders) at any price level during the auction
or up to a specified limit price if a limit is specified.
---------------------------------------------------------------------------

    Lastly, the Exchange proposes to add at the end of Supplementary
Material .01 to Options 3, Section 11 that any solicited contra orders
entered by Members into the Facilitation Mechanism to trade against
Agency Orders may not be for the account of a Nasdaq ISE Market Maker
that is assigned to the options class.\29\ This language was included
in the approval order to SR-ISE-2006-78 to allow solicited transactions
in ISE's Facilitation Mechanism, so the proposed change will import
that prohibition into the rule text for greater transparency.
---------------------------------------------------------------------------

    \29\ See Securities Exchange Act Release No. 55557 (March 29,
2007), 72 FR 16838 (April 5, 2007) (SR-ISE-2006-78) (Order Granting
Approval of Proposed Rule Change Relating to Facilitation
Mechanism).
---------------------------------------------------------------------------

Solicited Order Mechanism
    The Exchange proposes a number of changes to its Solicitation rule,
none of which will change the current operation of this technology
offering.
    In Options 3, Section 11(d), the Exchange proposes to add new
subsection (d)(1),\30\ which will provide that orders must be must be
entered into the Solicited Order Mechanism at a price that is equal to
or better than the NBBO on both sides of the market; provided that, if
there is a Priority Customer order on the Exchange best bid or offer,
the order must be entered at an improved price. Orders that do not meet
these requirements are not eligible for the Solicited Order Mechanism
and will be rejected. The Exchange is not proposing any other changes
to the current entry requirements for Solicitation. The new subsection
(d)(1) would simply provide additional detail about simple
Solicitation's existing entry checks, and align to the level of detail
currently within the complex Solicitation rule regarding entry
checks.\31\
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    \30\ As a result, current paragraphs (d)(1)-(3) will be
renumbered accordingly. The Exchange will also renumber current
paragraph (d)(2)(D) as paragraph (d)(4).
    \31\ See Options 3, Section 11(e)(1). Complex Solicitation
refers to the Exchange's best bid or offer instead of the NBBO. As
noted above, there is no NBBO for complex orders, and executions of
legs of complex orders are exceptions to the prohibition of trade-
throughs. See supra note 20.
---------------------------------------------------------------------------

Example 3

    Assume the following market:

ISE BBO: 1 x 2 (also NBBO)

CBOE: 0.75. x 2.25 (next best exchange quote)
Solicitation order is entered to buy 500 contracts @ 2.05

The Solicitation order is rejected upon entry for being crossed with
the NBBO on the contra side. In contrast to Example 2 above for
Facilitation, the Solicitation order in this instance is not able to
begin crossed with the contra side ISE BBO because of the all-or-none
contingency of the Solicitation order.\32\
---------------------------------------------------------------------------

    \32\ See Options 3, Section 11(d) (requiring that each
Solicitation order be designated as all-or-none).
---------------------------------------------------------------------------

    In renumbered subsection (d)(2), the Exchange proposes to add
language to describe the content of the broadcast message sent to
Members upon entry of an order into simple Solicitation. In particular,
the Exchange proposes to specify that the broadcast message includes
the series, price and size of the Agency Order, and whether it is to
buy or sell. While this change reflects current functionality, the
existing rule is silent in this regard and only indicates that a
broadcast message is sent upon the order's entry into the mechanism.
Identical language already exists in the rules governing simple
Solicitation on GEMX and MRX, which operate in the same way as the
ISE's simple Solicitation.\33\
---------------------------------------------------------------------------

    \33\ See GEMX and MRX Options 3, Section 11(d)(1).
---------------------------------------------------------------------------

    Lastly, the Exchange also proposes technical changes in renumbered
subsection (d)(3) to correct the internal lettering and cross-cites
within paragraphs (A) through (C).
Price Improvement Mechanism
    The Exchange proposes a number of changes to the PIM rule, none of
which will change the current operation of this technology offering. As
noted above, many of these modifications are similar to the changes
proposed for Facilitation.
    The Exchange proposes in Options 3, Section 13(b)(2) to delete
``national best bid or offer'' as NBBO is already defined in subsection
(b)(1) above. The Exchange proposes in subsection (c)(2) to provide
that responses in the PIM (i.e., ``Improvement Orders'') will only be
considered up to the size of the Agency Order. The proposed amendment
will specifythat the System will cap the size of the Improvement Orders
to the auction size for purposes of the allocation methodology. This is
similar to the change proposed above for simple Facilitation, and also
aligns to identical language in the complex PIM rule.\34\ The Exchange
also proposes in subsection (c)(3) to amend the internal numbering from
(1) and (2) to (i) and (ii) for greater numbering consistency within
the PIM rule.
---------------------------------------------------------------------------

    \34\ See Options 3, Section 13(e)(4)(i).
---------------------------------------------------------------------------

    In subsection (d)(3), which describes how allocation and execution
takes place in simple PIM, the Exchange proposes that the Counter-Side
Order will be allocated the greater of one contract or 40% (or such
lower percentage requested by the Member) of the initial size of the
Agency Order. Similar to Facilitation as discussed above, the System
currently permits Members entering orders into PIM to elect to receive
a percentage allocation that is less than 40%, although the current
rule is silent in this regard. If the Member requests a lower
allocation percentage, the Counter-Side Order would receive an
allocation consistent with the percentage requested by the Member.
Regardless of the Member's request, the Counter-Side Order would still
be responsible for executing up to the full size of the agency order if
there is not enough interest to execute the agency order at a
particular price. Complex PIM, which shares the same allocation feature
as simple PIM, already has this concept within the rule, so the
proposed changes will align the simple PIM rule with the complex PIM
rule.\35\
---------------------------------------------------------------------------

    \35\ See Options 3, Section 13(e)(5)(iii). As noted above, BX
has a similar feature called Surrender for its PRISM auction. See
supra note 24.
---------------------------------------------------------------------------

    The Exchange also proposes to more accurately describe PIM's auto-
match functionality in a similar manner as Facilitation's auto-match
functionality, as discussed above. In this instance, the Exchange
proposes to amend the third sentence of subsection (d)(3) to provide:
``If a Member elects to auto-match, the Counter-Side Order will be
allocated the aggregate size of all competing quotes, orders, and
Responses at each price point up to the specified limit price if a
limit is specified, until a price point is reached where the balance of
the order can be fully executed.'' Similar to the proposed amendments
to simple Facilitation's auto-match, the Exchange believes that the
proposed language for simple PIM's auto-match more clearly explains how
the functionality works today, and better aligns with how this feature
is described in the Auto-Match Filing. For greater consistency within
its Rulebook, the Exchange will also make the same changes in the
complex PIM auto-match rule in Options 3, Section 13(e)(5)(iii).
    The Exchange further proposes technical amendments in subsection
(d)(3) to replace all instances of ``Counter-Side order'' as ``Counter-
Side Order'' to use the correct terminology. Lastly, the Exchange
proposes to provide in Supplementary Material .04 to Options 3, Section
13 that PIMs will not queue or overlap in any manner, except as
described in Options 3, Section 11(f) and (g). Sections 11(f) and (g)
set forth the governing provisions for concurrent complex auctions and
concurrent complex and simple auctions. The proposed changes to add in
the cross-cites to Sections 11(f) and (g) will make clear that two
simple or two complex PIM auctions are not permitted to run
concurrently, but that a simple PIM auction may run concurrently with a
complex PIM auction.
Trade Value Allowance
    The Exchange proposes a non-substantive change to amend the TVA
rule in Supplementary Material .03 to Options 3, Section 14 to add a
cross-cite to the complex PIM rule in Options 3, Section 13, which was
inadvertently omitted when the Exchange relocated the complex auctions
rules in a prior filing.\36\ In SR-ISE-2019-05, the original cross-cite
within the TVA rule was updated from Supplementary Material .08 to Rule
722 to Rule 716 (now Options 3, Section 11). Supplementary Material .08
to Rule 722 set forth the complex auction mechanism rules, namely
complex Facilitation, Solicitation, and PIM. SR-ISE-2019-05 relocated
complex Facilitation and Solicitation to Rule 716 (now Options 3,
Section 11), but moved complex PIM to Rule 723 (now Options 3, Section
13). As such, the original cross-cite in the TVA rule should have been
updated to include complex PIM in Rule 723 but was inadvertently
omitted.
---------------------------------------------------------------------------

    \36\ See Securities Exchange Release No. 85308 (March 13, 2019),
84 FR 10136 (March 19, 2019) (SR-ISE-2019-05).
---------------------------------------------------------------------------

    TVA is a functionality that allows complex orders to trade outside
of their expected notional trade amount by a specified amount. The
amount of TVA permitted may be determined by the Member, or a default
value determined by the Exchange and announced to Members.\37\ The TVA
rule currently provides, however, that any amount of TVA is permitted
in auction mechanisms pursuant to Options 3, Section 11 when auction
orders do not trade solely with their contra-side order. The Exchange
now proposes to add a cross-cite to Options 3, Section 13 to specify
that TVA also applies to complex PIM auctions in this manner. The
Exchange will also provide that TVA applies to ``complex'' mechanisms
in the cited rules. These changes will

align the rule text to how TVA is presently implemented in the System.
The Exchange notes that its complex auction mechanisms provide an
opportunity for market participants to respond with better-priced
interest that could execute against an Agency Order. As such, the
Exchange believes that it is appropriate to ensure that paired orders
entered into complex Facilitation, Solicitation and PIM that are broken
up due to better-priced interest are actually executed against such
better-priced interest, and are not restricted from trading due to TVA
settings of one or more Members.
---------------------------------------------------------------------------

    \37\ See Supplementary Material .03 to Options 3, Section 14.
---------------------------------------------------------------------------

Anti-Internalization
    The Exchange proposes to amend its anti-internalization (``AIQ'')
rule in Options 3, Section 15(a)(3)(A). Specifically, the Exchange
proposes to add that AIQ does not apply during the opening process or
reopening process following a trading halt pursuant to Options 3,
Section 8 to provide more specificity on how this functionality
currently operates. The Exchange notes that the same procedures used
during the opening process are used to reopen an option series after a
trading halt, and therefore proposes to specify that AIQ will not apply
during an Opening Process (i.e., the opening and halt reopening
process) in addition to an auction, as currently within the Rule. AIQ
is unnecessary during an Opening Process due to the high level of
control that Market Makers exercise over their quotes during this
process. The proposed changes will align the Exchange's AIQ rule with
BX's AIQ rule, which sets forth materially identical functionality.\38\
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    \38\ See BX Options 3, Section 15(c)(1).
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Exposure Mechanism
    Under the linkage rules, the Exchange cannot execute orders at a
price that is inferior to the NBBO, nor can the Exchange place an order
on its book that would cause the Exchange best bid or offer to lock or
cross another exchange's quote.\39\ In these circumstances,
Supplementary Material .02 to Options 5, Section 2 sets forth an
Exposure mechanism for automated order handling where eligible incoming
orders are exposed at the NBBO to all Members to give them an
opportunity to execute the order at the NBBO price or better. The
Exchange proposes to make clear within Supplementary Material .02 that
an incoming order will be eligible for Exposure if the order is priced
at or through the ABBO, when the ABBO is better than the Exchange BBO.
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    \39\ See Options 5, Sections 2 and 3. See also Options 3,
Section 5(d).
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    Supplementary Material .02 to Options 5, Section 2 currently
provides that when the automatic execution of an incoming order would
result in an impermissible Trade-Through, such order would be exposed
at the current NBBO to all Exchange Members for a time period
established by the Exchange not to exceed one (1) second. Supplementary
Material .01 to Options 5, Section 3, however, currently provides that
when the price of an incoming limit order that is not executable upon
entry would lock or cross a Protected Quotation, such order would be
handled in accordance with the Exposure process in Supplementary
Material .02 to Options 5, Section 2.\40\ The Exchange proposes to
modify Supplementary Material .02 by removing the portion related to
the automatic execution of an incoming order that would result in an
impermissible Trade-Through, and instead providing within this Rule
that Exposure will initiate when an incoming order is priced at or
through the ABBO, when the ABBO is better than the Exchange BBO. The
current language in Supplementary Material .02 only specifies that
Exposure is initiated when the price of the incoming order is crossed
with the ABBO (i.e., would result in an impermissible Trade-Through),
but does not specify the scenario in Supplementary Material .01 to
Options 5, Section 3 when the price is locked. As such, the proposed
changes seek to enhance the accuracy of the rules by codifying both
scenarios within the Exposure rule in Supplementary Material .02.
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    \40\ Such order would also be handled in accordance with
Supplementary Material .04 (Non-Customer Orders that opt out of the
Exposure mechanism) or .05 (Sweep Orders) to Options 5, Section 2,
as applicable. See Supplementary Material .01 to Options 5, Section
3.
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Technical Amendments
    The Exchange proposes technical changes in the Supplementary
Material to Options 3, Section 11. First, the Exchange proposes in
Supplementary Material .03 to update an incorrect cross-cite from
Options 3, Section 22(d) to Section 22(b), which limits principal
transactions. Second, the Exchange will make corrective changes to
renumber Supplementary Material .07 to .05, and to update the cross-
cite to paragraph (a)(2)(i) therein to paragraph (a)(2)(A). Third, the
Exchange proposes in renumbered Supplementary Material .07 to update
the reference to ``Block Mechanism'' to ``Block Order Mechanism'' to
use the correct terminology.
    Lastly, the Exchange proposes some harmonizing changes throughout
its Rulebook to align with the rule numbering and titles with that of
its affiliates. Specifically, the Exchange proposes to add a new
Options 4B and reserve it in the Rulebook in order to harmonize its
Options Rule numbering with that of its affiliates, GEMX and Nasdaq
PHLX LLC (``Phlx''). The Exchange also proposes to retitle General 4
(currently titled ``Regulation'') to ``Registration Requirements'' to
harmonize its General Rule titles with that of its affiliates The
Nasdaq Stock Market LLC and Nasdaq BX, Inc.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\41\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\42\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest.
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    \41\ 15 U.S.C. 78f(b).
    \42\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that its proposal is consistent with the
protection of investors and public interest as all of the proposed
changes will increase transparency around how various existing Exchange
mechanisms work today. As such, no System changes to existing
functionality are being made pursuant to this proposal. Rather, this
proposal is designed to reduce any potential investor confusion as to
the features and applicability of certain functionality presently
available on the Exchange.
    Furthermore, many of the proposed changes seek to provide greater
harmonization between the rules of the Exchange and its affiliates
(notably rules related to Block, Facilitation, Solicitation, and AIQ),
or between the Exchange's own simple and complex auction rules (notably
for simple and complex Facilitation, Solicitation, and PIM).\43\ The
Exchange believes that these harmonizing changes would result in
greater uniformity, and ultimately less burdensome and more efficient
regulatory compliance by market participants. As such, the proposed
rule change would foster cooperation and coordination with persons
engaged in facilitating transactions in securities and

would remove impediments to and perfect the mechanism of a free and
open market and a national market system. The Exchange also believes
that more consistent rules will increase the understanding of the
Exchange's operations for Members that are also members on the
Exchange's affiliates, thereby contributing to the protection of
investors and the public interest.
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    \43\ As noted above, the Exchange seeks to add granularity to
its simple auction rules to align with the level of detail that
currently exists within its complex auction rules. See supra note
17.
---------------------------------------------------------------------------

    Specifically, the Exchange believes that the proposed universal
changes to replace all instances of Professional interest with non-
Priority Customer interest throughout the Exchange's auction allocation
rules will add greater consistency within the Exchange's rules. As
discussed above, the Exchange previously made the same modifications
within its standard allocation rule in Options 7, Section 10, so the
proposed changes will promote more consistent terminology in the rules
and make them easier for market participants to navigate and
comprehend. The Exchange also believes that using the term ``non-
Priority Customer'' reduces any potential confusion regarding any
reference to Professional Orders or Professional Customer orders. In
addition, the Exchange believes that clearly delineating between orders
and Reponses of the same capacity in the Facilitation and Solicitation
rules will bring clarity and transparency around how allocation takes
place in those auction mechanisms. The complex Facilitation and
Solicitation rules currently differentiate between orders and
Responses,\44\ so the Exchange is aligning the simple rule to the level
of granularity already found in the complex rule while also specifying
the capacity of such order or Response within the simple and complex
rules. As noted above, the Exchange is not changing the current
allocation methodology, and auction orders and Responses of the same
capacity do not get treated differently for allocation purposes today.
---------------------------------------------------------------------------

    \44\ See supra note 14.
---------------------------------------------------------------------------

    The Exchange believes that the proposed changes to the Block rule
are consistent with the protection of investors and the public interest
as the modifications will more accurately reflect the handling of
auctions in Block, specifically as it relates to execution and
allocation. The proposed changes will specify that better priced
interest entered into Block gets executed in full only if there is
sufficient size to execute against such interest, and that Priority
Customer interest gets executed first in price time priority. This
specificity will be helpful to market participants utilizing Block and
provide greater certainty as to how their Block orders will be executed
and allocated. The Exchange also believes that the proposed changes
will continue to ensure a fair and orderly market by maintaining and
protecting the priority of Priority Customer orders, while still
affording the opportunity for all market participants to seek liquidity
and potential price improvement during each Block auction commenced on
the Exchange. As noted above, the Exchange is not proposing any changes
to the current execution or allocation methodology but believes that
the changes will promote consistency with the rulebook of its
affiliated exchange BX, which offers identical functionality.\45\
---------------------------------------------------------------------------

    \45\ See supra notes 15-16, and accompanying text.
---------------------------------------------------------------------------

    Similarly, the Exchange believes that specifying the entry checks
for simple Facilitation and Solicitation is consistent with the
protection of investors and the public interest by providing greater
consistency to the level of granularity currently within the complex
Facilitation and Solicitation entry checks.\46\ The Exchange also
believes it is appropriate to require that the Facilitation order be
entered at an improved price if there is a Priority Customer order on
the same side Exchange best bid or offer as the agency order. The
Exchange believes this will ensure a fair and orderly market by
maintaining priority of orders and quotes and protecting Priority
Customer orders, while still affording the opportunity to seek
liquidity and for potential price improvement during each Facilitation
auction commenced on the Exchange. For the same reasons, the Exchange
believes that it is appropriate to require that the Solicitation order
be entered at an improved price if there is a Priority Customer order
on the Exchange best bid or offer.
---------------------------------------------------------------------------

    \46\ See supra notes 20 and 31, and accompanying text.
---------------------------------------------------------------------------

    The Exchange further believes that it is consistent with the Act to
specify the contents of the broadcast message sent to Members upon
entry of an order into simple Facilitation and Solicitation as the
changes will remove any potential confusion about what type of auction
information is disseminated. Currently, the broadcast message in simple
Facilitation and Solicitation includes the series, price, and size of
the Agency Order, and whether it is to buy or sell. As this information
is helpful to auction participants, the Exchange believes that
codifying this information into the simple Facilitation and
Solicitation rules may encourage greater participation within these
mechanisms, thereby increasing the opportunity for options orders to
receive executions on the Exchange. The Exchange is not proposing any
changes to the current content of the broadcast message but wants to
make this clear in its rules, which, with this change, would be
consistent with the rules of its affiliated exchanges that offer
identical functionality.\47\ Likewise, the proposed change to add that
a facilitation order would be cancelled at the end of the exposure
period if an execution would take place at a price that is inferior to
the best bid (offer) on the Exchange is intended to ensure compliance
with the general prohibition on trade-throughs in Options 5, Section
2(a), and to ensure consistency across the rules of the Exchange and
its affiliates that offer identical functionality.\48\
---------------------------------------------------------------------------

    \47\ See supra notes 21 and 33.
    \48\ See supra note 23.
---------------------------------------------------------------------------

    The proposed changes to replace ``must not exceed'' with ``will
only be considered up to'' in the simple Facilitation and PIM rules are
intended to more accurately describe that the System will cap the size
of Responses to the size of the agency order for purposes of
allocation. The Exchange is not amending current System behavior;
rather, the modifications will more clearly articulate the handling of
Responses by the System. In addition, the proposed changes will serve
to harmonize the simple and complex auction rules, thereby resulting in
greater uniformity and ultimately less burdensome and more efficient
regulatory compliance by market participants.\49\
---------------------------------------------------------------------------

    \49\ See supra notes 22 and 34.
---------------------------------------------------------------------------

    The Exchange believes that its proposal to specify in the simple
Facilitation and PIM rules that an initiating Member may elect to
receive a percentage allocation lower than 40% is consistent with the
Act. This feature provides an initiating Member that submits an order
into Facilitation or PIM with the flexibility to configure its
allocation percentage up to the full 40% entitlement. The Exchange
notes that regardless of the Member's instruction, the contra-side
order would still be responsible for executing up to the full size of
the agency order if there is not enough interest to execute the agency
order at a particular price. The Exchange continues to believe that the
40% allocation entitlement is consistent with the statutory standards
for competition and free and open markets by promoting price
competition within Facilitation and PIM as Members would still have a
reasonable opportunity to compete for a significant percentage of

the incoming order. The Exchange also notes that the configurable 40%
allocation entitlement for simple Facilitation and PIM is consistent
with the configurable allocation entitlements in place on complex
Facilitation and PIM as well as on its affiliated exchange, BX.\50\
Accordingly, the Exchange believes that the proposed changes will
promote consistency across the rulebooks of exchanges offering
identical functionality and within its own Rulebook as well.
---------------------------------------------------------------------------

    \50\ See supra notes 24 and 35.
---------------------------------------------------------------------------

    With respect to the proposed changes to the Facilitation and PIM
auto-match feature, the Exchange is amending the current rule text so
that it more accurately explains how the Exchange will allocate an
order designated for auto-match today. As discussed above, the Exchange
is not making any substantive changes to the allocation procedure
itself; rather the proposed changes are intended to better align how
this feature is described in the Auto-Match Filing.\51\ Similarly, the
Exchange believes that the proposed change in Supplementary Material
.01 to Options 3, Section 11 to add the provision that any solicited
contra orders entered by Members into the Facilitation Mechanism to
trade against Agency Orders may not be for the account of a Nasdaq ISE
Market Maker that is assigned to the options class will better align
the rule text with related filing. As discussed above, this restriction
was included in the approval order to the rule filing that allowed
solicited transactions in the Facilitation Mechanism, so the Exchange
will import that language into the rule text for greater
transparency.\52\
---------------------------------------------------------------------------

    \51\ See supra note 28.
    \52\ See supra note 29.
---------------------------------------------------------------------------

    The proposed change in Supplementary Material .04 to Options 3,
Section 13 to provide that PIMs will not queue or overlap in any
manner, except as described in Options 3, Section 11(f) and (g) will
make clear that two simple or complex PIM auctions are not permitted to
run concurrently, but that a simple PIM auction may run concurrently
with a complex PIM auction. The Exchange believes that this change will
reduce any potential confusion around how simultaneous PIM auctions are
processed by the System.
    The Exchange believes that the proposed change to the TVA rule is a
non-substantive change to say that any amount of TVA is permitted in
complex PIM (in addition to all of the other complex auction mechanisms
in Options 3, Section 11). This is a corrective change as the cross-
cite to complex PIM within the TVA rule was inadvertently dropped in a
prior filing that relocated the complex auction rules.\53\ As noted
above, the Exchange's complex auction mechanisms provide an opportunity
for market participants to respond with better-priced interest that
could execute against an Agency Order. Accordingly, the Exchange
believes that it is appropriate to ensure that paired orders entered
into complex Facilitation, Solicitation and PIM that are broken up due
to better-priced interest are actually executed against such better-
priced interest, and are not restricted from trading due to TVA
settings of one or more Members.
---------------------------------------------------------------------------

    \53\ See supra note 36.
---------------------------------------------------------------------------

    The Exchange believes its proposal to provide that AIQ will not
apply during an Opening Process (i.e., the opening process or halt
reopening process) will more accurately state how this functionality
currently operates. AIQ prevents Market Makers from trading against
their own quotes and orders. While the Exchange believes that this
protection is useful for Market Makers to manage their trading during
regular market hours, applying AIQ is unnecessary during an Opening
Process due to the high level of control that Market Makers already
exercise over their quotes during this process. Furthermore, the
proposed AIQ changes will promote consistency with the rulebook of its
affiliated exchange BX, which offers identical functionality.\54\
---------------------------------------------------------------------------

    \54\ See supra note 38.
---------------------------------------------------------------------------

    The Exchange believes that its proposal to provide that Exposure
will initiate when an incoming order is priced at or through the ABBO,
when the ABBO is better than the Exchange BBO, is consistent with the
Act. As discussed above, the current language in Supplementary Material
.02 only specifies that Exposure is initiated when the price of the
incoming order is crossed with the ABBO (i.e., would result in an
impermissible Trade-Through), but does not specify the scenario in
Supplementary Material .01 to Options 5, Section 3 when the price is
locked. Supplementary Material .01 to Options 5, Section 3, however,
also currently provides that when the price of an incoming limit order
that is not executable upon entry would lock or cross a Protected
Quotation, such order would be handled in accordance with the Exposure
process in Supplementary Material .02 to Options 5, Section 2. As such,
the proposed changes will enhance the accuracy of the rules by
codifying both scenarios within the Exposure rule in Supplementary
Material .02, and will continue to ensure that such order complies with
the general prohibition on trade-throughs in Options 5, Section 2(a).
    The Exchange further believes that the technical changes it is
proposing throughout Options 3 are non-substantive changes intended to
enhance the accuracy of the Exchange's Rulebook, which will alleviate
potential confusion as to the applicability of its rules. As discussed
above, these changes consist of updating internal rule lettering and
cross-cites, and using correct terminology. Lastly, the Exchange
believes that the harmonizing changes to add a new Options 4B in its
Rulebook and to retitle General 4, each as discussed above, will serve
to further harmonize its Rule numbering and titling with that of its
affiliates, thereby promoting efficiency and conformity of its
processes with those of its affiliated exchanges.

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 not necessary or appropriate in
furtherance of the purposes of the Act. As indicated above, no System
changes to existing functionality are being made pursuant to this
proposal; rather, this proposal is designed to reduce any potential
investor confusion as to the features and applicability of certain
functionality presently available on the Exchange. Therefore, the
proposed changes are designed to enhance clarity and consistency in the
Exchange's Rulebook.
    Furthermore, many of the proposed changes seek to provide greater
harmonization between the rules of the Exchange and its affiliates, and
therefore promotes fair competition among the options exchanges. In
particular, the proposed changes discussed above for Block and AIQ are
based on BX rules governing identical functionality,\55\ and the
Facilitation and Solicitation changes around broadcast message content
and trade-through prohibition compliance (Facilitation only) are based
on GEMX and MRX rules governing identical functionality.\56\ The
Exchange notes that it operates in a highly competitive market in which
market participants can readily direct order flow to competing venues
who offer similar functionality. The Exchange believes that the

proposed rule change will enhance competition among the various markets
for auction execution, potentially resulting in more active trading in
auction mechanisms across all options exchanges.
---------------------------------------------------------------------------

    \55\ See BX Options 3, Section 11(a) (Block) and Section
15(c)(1) (AIQ).
    \56\ See GEMX and MRX Options 3, Section 11(b)(1) (Facilitation
broadcast message), Options 3, Section 11(d)(1) (Solicitation
broadcast message), and Options 3, Section 11(b)(3) (Facilitation
executions trade-through compliance).
---------------------------------------------------------------------------

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

    No written comments were either solicited or received.

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; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \57\ and
paragraph (f)(6) of Rule 19b-4 thereunder.\58\
---------------------------------------------------------------------------

    \57\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \58\ 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.
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend 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. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or 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-ISE-2021-01 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-ISE-2021-01. 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 website (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 website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549-1090 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. Persons submitting
comments are cautioned that we do not redact or edit personal
identifying information from comment submissions. You should submit
only information that you wish to make available publicly. All
submissions should refer to File Number SR-ISE-2021-01, and should be
submitted on or before March 25, 2021.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\59\
---------------------------------------------------------------------------

    \59\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-04428 Filed 3-3-21; 8:45 am]
BILLING CODE 8011-01-P