[Federal Register: March 8, 2006 (Volume 71, Number 45)]
[Notices]
[Page 11694-11696]
[DOCID:fr08mr06-132]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-53396; File No. SR-FICC-2005-17]

Self-Regulatory Organizations; Fixed Income Clearing Corporation;
Notice of Filing of Proposed Rule Change Relating to Assumption of
Blind Brokered Fails by Its Government Securities Division

March 2, 2006.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on September 30, 2005, the
Fixed Income Clearing Corporation (``FICC'') filed with the Securities
and Exchange Commission (``Commission'') a proposed rule change and on
November 28, 2005 amended the proposed rule change that is described in
Items I, II, and III below, which items have been prepared primarily by
FICC. The Commission is publishing this notice to solicit comments on
the proposed rule change from interested parties.
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    \1\ 15 U.S.C. 78s(b)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The proposed rule change would clarify the practice of the
Government Securities Division (``GSD'') of FICC of assuming certain
blind brokered repurchase transaction (``repo'') fails and of obtaining
financing in connection with such assumption.

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

    In its filing with the Commission, FICC 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. FICC has prepared summaries, set forth in sections (A),
(B),

and (C) below, of the most significant aspects of these statements.\2\
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    \2\ The Commission has modified the text of the summaries
prepared by FICC.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    The purpose of the proposed rule change is to clarify the practice
of the GSD of FICC of assuming certain blind brokered repo fails and of
obtaining financing as necessary in connection with such assumption.
The settlement of the start leg of a same-day starting repo has always
been and continues to be processed outside of the GSD. In the evening
of the day of a same-day starting brokered repo, FICC will assume
responsibility from the broker for settlement of such start leg if the
repo dealer has not delivered securities to the broker to start the
repo (i.e., the start leg has failed). This may involve the receipt of
securities from the repo dealer for redelivery to the reverse repo
dealer or the settlement of the start leg may be effected by netting or
pairoff of the settlement obligations arising from the start leg
against the settlement obligations arising from the close leg of the
same or another repo.
    FICC will also assume a blind brokered repo fail that arises in the
close leg of a blind brokered repo transaction. For example, if the
start leg of the transaction settles outside of FICC in the normal
course but one side of the close leg does not compare (for any reason
that would cause a trade to not compare such as erroneous trade data
submitted by one or both of the parties), the broker will wind up with
a net settlement position rather than netting flat. If that transaction
fails to settle, FICC will assume the broker's fail.
    FICC assumes the fails in these instances in order to decrease
risk.\3\ By assuming the fail, FICC removes the broker, which acts as
an intermediary and which expects to net out of every transaction and
not have a settlement position, from the settlement process. FICC is
proposing to add a provision to its rules to expressly provide for this
practice and therefore to make its rules consistent with its current
and longstanding practice.\4\
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    \3\ FICC has engaged in the practice of assuming broker fails
since the inception of its blind brokered repo service.
    \4\ The specific rule being added is Rule 19, Section 5,
``Assumption of Blind Brokered Fails.''
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    In the assumption of such broker fails, the need for financing
might arise. For example, such as if the repo dealer delivered
securities at the close of the securities Fedwire and if the broker was
unable to deliver them to the reverse repo dealer. The GSD's rules
already contain a provision, Section 8 of Rule 12, that addresses the
GSD's need to obtain financing in general. This provision contemplates
the need for financing in order to allow the GSD to facilitate
securities settlement generally. It is important to note that such
financing is part of the GSD's normal course of business, and the GSD's
ability to obtain such financing is necessary for it to be able to
complete securities settlement. Section 8 of Rule 12 provides that if
FICC deems it appropriate to obtain financing to provide its securities
settlement services, FICC may create security interests in eligible
netting securities delivered by a netting member in order to obtain
such financing. The provision requires that members not take any action
to adversely affect this process. The provision also states that such
security interests may be created to obtain financing in an amount
greater than the obligation of a member to FICC relating to such
eligible netting securities. Thus, clearing fund securities may be used
to collateralize such financing. Also, Section III.C of the GSD's fee
structure provides the formula that the GSD will use to charge members
for the cost of any financing obtained by the GSD.
    FICC wishes to interpret Section 8 of Rule 12 and Section III.C. to
apply to financing that might arise because of FICC's assumption of
blind brokered fails. FICC does not believe that actual changes to the
rules are necessary for this clarification.
    FICC believes that the proposed change is consistent with Section
17A of the Act \5\ and the rules and regulations thereunder applicable
to FICC because it clarifies FICC's rules for consistency with current
practice and provides an interpretation of an existing rule.
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    \5\ 15 U.S.C. 78q-1.
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    FICC does not believe that the proposed rule change will have any
impact or impose any burden on competition.

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

    Written comments relating to the proposed rule change have not yet
been solicited or received. FICC will notify the Commission of any
written comments received by FICC.

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

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

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
) or     Send an e-mail to<EMAIL_ADDRESS>Please include

File Number SR-FICC-2005-17 in the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
    All submissions should refer to File Number SR-FICC-2005-17. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments,

all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for inspection
and copying in the Commission's Public Reference Section, 100 F Street,
NE., Washington, DC 20549. Copies of such filings also will be
available for inspection and

copying at the principal office of FICC and on FICC's Web site, http://www.ficc.com.
 All comments received will be posted without change; the

Commission does not edit personal identifying information from
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-
FICC-2005-17 and should be submitted on or before March 29, 2006.

    For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\6\
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    \6\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E6-3272 Filed 3-7-06; 8:45 am]

BILLING CODE 8010-01-P


WELL_ID   DATE         ACETOCHLOR (ppb)

IA-07/1   6/1/1995     0.78
IA-07/1   7/16/1995    0.39
IA-07/1   8/24/1995    0.13
IA-07/1   5/21/1997    4.35
IA-07/1   6/22/1997    1.27
IA-07/1   7/13/1997    0.28
IA-07/1   8/20/1997    0.14
IA-07/1   9/17/1997    0.11
IA-09     5/21/1997    0.14
IA-19     8/1/1998     0.06
IL-08     5/23/1995    0.27
IL-08     6/1/1995     0.11
IL-15     7/1/1995     0.06
IL-24/1   5/27/1995    2.11
IL-24/1   6/1/1995     1.02
IL-24/1   7/27/1995    0.38
IL-24/1   8/30/1995    0.25
IL-24/1   9/27/1995    0.31
IL-24/1   10/30/1995   0.31
IL-24/1   11/30/1995   0.25
IL-24/1   12/28/1995   0.14
KS-06     8/1/1998     0.11
KS-06     10/1/1998    0.14
KS-06     11/1/1998    0.11
KS-06     12/1/1998    0.24
KS-13     12/15/1996   0.04
KS-14     3/11/1996    0.08
KS-14     4/9/1996     0.12
KS-14     5/9/1996     0.14
KS-14     6/4/1996     0.12
KS-14     7/6/1996     0.14
KS-14     8/13/1996    0.29
KS-14     9/19/1996    0.17
KS-14     10/19/1996   0.26
KS-14     11/1/1996    0.18
KS-14     12/15/1996   0.16
KS-14     1/21/1997    0.32
KS-14     2/17/1997    0.21
KS-14     3/18/1997    0.15
KS-14     4/17/1997    0.13
KS-14     5/20/1997    0.13
KS-14     6/19/1997    0.14
KS-14     7/26/1997    0.15
KS-14     8/22/1997    0.22
KS-14     9/1/1997     0.22
KS-14     10/1/1997    0.21
KS-14     11/1/1997    0.17
KS-14     12/1/1997    0.09
KS-14     1/1/1998     0.06
KS-14     1/1/1998     0.06
KS-17     4/14/1998    0.14
KS-17     2/1/1998     0.07
KS-17     3/1/1998     0.16
KS-17     5/20/1998    0
KS-17     6/29/1998    0.06
KS-17     2/1/1998     0.07
KS-17     3/1/1998     0.16
KS-17     4/1/1998     0.14
KS-17     6/1/1998     0.06
KS-17     7/1/1998     0.11
KS-17     8/1/1998     0.13
KS-17     9/1/1998     0.16
KS-17     10/1/1998    0.19
KS-17     11/1/1998    0.11
KS-17     12/1/1998    0.16
KS-19     9/1/1998     0.07
KS-19     10/1/1998    0.11
KS-19     11/1/1998    0.11
KS-19     12/1/1998    0.13
KS-25     7/1/1998     0.12
MN-13     9/19/1995    0.1
MN-13     10/17/1995   0.09
MN-13     11/16/1995   0.09
MN-13     3/20/1996    0.056
MN-13     4/17/1996    0.051
MN-24     5/1/1995     0.11
NE-15     7/9/1996     0.07


[Federal Register Volume 80, Number 65 (Monday, April 6, 2015)]
[Notices]
[Pages 18391-18392]
[FR Doc No: 2015-07760]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. CP15-116-000]

Southwest Gas Storage Company; Notice of Request Under Blanket
Authorization

    Take notice that on March 18, 2015, Southwest Gas Storage Company
(Southwest), 1300 Main Street, Houston, Texas 77002, filed in Docket
No. CP15-116-000 a prior notice request pursuant to sections 157.205
and 157.216(b) of the Commission's regulations under the Natural Gas
Act (NGA), as amended, requesting authorization to plug and abandon 11
wells, associated lateral pipelines, and appurtenances at its Waverly
Storage Field in Morgan County, Illinois, all as more fully set forth
in the application which is on file with the Commission and open to
public inspection. The filing may also be viewed on the web at 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. For assistance, please contact FERC Online Support at
<EMAIL_ADDRESS>or toll free at<PHONE_NUMBER>, or TTY,
contact<PHONE_NUMBER>.
    Specifically, Southwest proposes to plug and abandon seven inactive
injection/withdrawal wells (Carr 2-9, Staton 2-15, Mosley 2-16, Rogers
1-16, Stenemeyer 2-15, Edwards 1-16, and Wheeler 2-15). Southwest
further proposes to abandon the related laterals, totaling 5,362 feet
of 4-, 6-, and 8-inch diameter pipeline, with appurtenances.
Additionally, Southwest proposes to plug and abandon four observation
wells (Dora Hubbs 1-33, Burnett 1-4, B.J. Stenemeyer 1-22, and Wheeler
1-22). Southwest states that the working gas at the Waverly Storage
Field has been reduced, leaving a number of wells too far from the gas
bubble to provide useful service. Also, Southwest asserts that there
have been integrity problems in the lateral pipelines, well site
facilities, and wellheads due to corrosion. Southwest states that it
does not anticipate storage field operation to change to where the
subject wells would be needed for injection/withdrawal service.
Southwest avers that the proposed abandonment project will have no
effect on the certificated physical parameters of the Waverly Storage
Field, including total inventory, reservoir pressure, reservoir and
buffer boundaries, and certificated capacity. Southwest estimates the
cost of the proposed abandonment to be approximately $853,000.
    Any questions concerning this application may be directed to
Stephen Veatch, Sr. Director of Certificates, Southwest Gas Storage
Company, 1300 Main Street, Houston, Texas 77002, by telephone at (713)
989-2024, by facsimile at<PHONE_NUMBER>, or by email at
<EMAIL_ADDRESS>    Any person or the Commission's staff may, within 60 days after
issuance of the instant notice by the Commission, file pursuant to Rule
214 of the Commission's Procedural Rules (18 CFR 385.214) a motion to
intervene or notice of intervention and pursuant to section 157.205 of
the regulations under the NGA (18 CFR 157.205), a protest to the
request. If no protest is filed within the time allowed therefore, the
proposed activity shall be deemed to be authorized effective the day
after the time allowed for filing a protest. If a protest is filed and
not withdrawn within 30 days after the allowed time for filing a
protest, the instant request shall be treated as an application for
authorization pursuant to section 7 of the NGA.
    Pursuant to section 157.9 of the Commission's rules, 18 CFR 157.9,
within 90 days of this Notice the Commission staff will either:
Complete its environmental assessment (EA) and place it into the
Commission's public record (eLibrary) for this proceeding, or issue a
Notice of Schedule for Environmental Review. If a Notice of Schedule
for Environmental Review is issued, it will indicate, among other
milestones, the anticipated date for the Commission staff's issuance of
the EA for this proposal. The filing of the EA in the Commission's
public record for this proceeding or the issuance of a Notice of
Schedule for Environmental

Review will serve to notify federal and state agencies of the timing
for the completion of all necessary reviews, and the subsequent need to
complete all federal authorizations within 90 days of the date of
issuance of the Commission staff's EA.
    Persons who wish to comment only on the environmental review of
this project should submit an original and two copies of their comments
to the Secretary of the Commission. Environmental commenter's will be
placed on the Commission's environmental mailing list, will receive
copies of the environmental documents, and will be notified of meetings
associated with the Commission's environmental review process.
Environmental commenter's will not be required to serve copies of filed
documents on all other parties. However, the non-party commentary, will
not receive copies of all documents filed by other parties or issued by
the Commission (except for the mailing of environmental documents
issued by the Commission) and will not have the right to seek court
review of the Commission's final order.
    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 should
submit an original and 7 copies of the protest or intervention to the
Federal Energy Regulatory Commission, 888 First Street NE., Washington,
DC 20426.

    Dated: March 30, 2015.
Kimberly D. Bose,
Secretary.
[FR Doc. 2015-07760 Filed 4-3-15; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register: May 22, 2006 (Volume 71, Number 98)]
[Notices]
[Page 29329]
[DOCID:fr22my06-45]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 2192-022--WI]

Consolidated Water Power Company; Notice of Availability of Draft
Environmental Assessment

May 12, 2006.
    In accordance with the National Environmental Policy Act of 1969
and the Federal Energy Regulatory Commission's (Commission)
regulations, 18 CFR part 380 (Order No. 486, 52 FR 47897), the Office
of Energy Projects has reviewed an application for the conveyance and
acquisition of project lands at the Biron Project (FERC No. 2192), and
has prepared a draft environmental assessment (DEA) for the proposal.
The proposed project land exchange would occur on the Biron reservoir
in Wood County, Wisconsin.
    In the application, Consolidated Water Power (licensee) requests
Commission authorization to exchange approximately 3.14 acres of
licensee-owned lands with 3,000 linear feet of shoreline along the
Biron flowage, for three different parcels of land totaling
approximately 205.213 total acres. The first parcel has 830 linear feet
of river shoreline and consists of 47.546 acres. The second parcel has
126 linear feet of river shoreline and consists of 2.960 acres,
abutting an existing licensee-owned boat launch. The third parcel
consists of islands in the river, peninsulas, and a roadside access
totaling 154.84 acres (48.82 acres above water). These island
perimeters, peninsulas, and the roadside access total 33,749 linear
feet of waterfront. All lands are currently within the project
boundary, and the licensee intends to retain flowage rights over any
conveyed lands, and to retain all lands within the project boundary.
The DEA contains the Commission staff's analysis of the probable
environmental impacts of the licensee's land-exchange proposal.
    The DEA is available for review and reproduction at the
Commission's Public Reference Room, located at 888 First Street, NE.,
Room 2A, Washington, DC 20426. The DEA may also be viewed on the
Commission's Web site at http://www.ferc.gov using the ``elibrary''

link. Enter the docket number (P-2192-022) excluding the last three
digits, in the docket number field to access the document. For
assistance, contact FERC Online Support at<EMAIL_ADDRESS>or toll-free at<PHONE_NUMBER>, or for TTY, contact<PHONE_NUMBER>.
    Comments on the DEA should be filed within 30 days of the date of
this notice and should be addressed to Magalie R. Salas, Secretary,
Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426. Please reference ``Biron Project, FERC Project
No. 2192-022'' on all comments. Comments may be filed electronically
via the Internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and
the instructions on the Commission's Web site under the ``e-Filing''
link.

Magalie R. Salas,
Secretary.
 [FR Doc. E6-7695 Filed 5-19-06; 8:45 am]

BILLING CODE 6717-01-P


[Federal Register Volume 86, Number 25 (Tuesday, February 9, 2021)]
[Notices]
[Pages 8819-8824]
[FR Doc No: 2021-02588]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-91047; File No. SR-FINRA-2021-002]

Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change Relating to the Private Placement Filer Form Under
FINRA Rules 5122 and 5123

February 3, 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 January 27, 2021, the Financial Industry Regulatory Authority, Inc.
(``FINRA) 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 FINRA. FINRA has
designated the proposed rule change as constituting a ``non-
controversial'' rule change under paragraph (f)(6) of Rule 19b-4 under
the Act,\3\ which renders the proposal effective upon receipt of this
filing by the Commission. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 17 CFR 240.19b-4(f)(6). Rule 19b-4(f)(6)(iii) requires a
self-regulatory organization to give the Commission written notice
of its intent to file the proposed rule change, along with a brief
description and text of 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. FINRA
has satisfied this requirement.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    FINRA is proposing changes to the Private Placement Filer Form
(``Filer Form'') that members complete when submitting private
placement filings under FINRA Rules 5122 (Private Placements of
Securities Issued by Members) or 5123 (Private Placements of
Securities). The proposal does not make any changes to the text of
FINRA rules.

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

    In its filing with the Commission, FINRA 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. FINRA 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
    Rules 5122 and 5123 require a FINRA member to file information
regarding private placements in which the member participates.\4\ When
Rule 5123

became effective on December 3, 2012,\5\ FINRA required members to use
the Filer Form for filings under both rules.\6\ Members submit the
Filer Form and relevant offering documents to FINRA through the FINRA
Gateway.\7\ On July 1, 2013, FINRA amended Rule 5123 to require members
to file the requisite information ``in a manner prescribed by FINRA''
and also began using an updated version of the Filer Form.\8\ On May
22, 2017, FINRA began using a further updated Filer Form.\9\ The
changes proposed herein would update the version of the Filer Form that
has been in use since May 2017 for filings made pursuant to Rule 5122
and Rule 5123.
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    \4\ Both Rules 5122 and 5123 provide exemptions from the filing
requirement when certain types of securities are sold or securities
are sold to certain types of investors. See Rules 5122(c) and
5123(b).
    \5\ See Securities Exchange Act Release No. 67157 (June 7,
2012), 77 FR 35457 (June 13, 2012) (Notice of Filing of Amendments
No. 2 and No. 3 and Order Granting Accelerated Approval of File No.
SR-FINRA-2011-057); Regulatory Notice 12-40 (September 2012).
    \6\ See Regulatory Notice 12-40 (September 2012). See also
Regulatory Notice 13-26 (August 2013); Securities Exchange Act
Release No. 69843 (June 25, 2013), 78 FR 39367 (July 1, 2013)
(Notice of Filing and Immediate Effectiveness of a Proposed Rule
Change Relating to Members' Filing Obligations Under FINRA Rule 5123
(Private Placements of Securities) File No. SR-FINRA-2013-026).
    \7\ FINRA Gateway is an online compliance tool that provides
consolidated access to FINRA applications and allows members to
submit required filings electronically to meet their compliance and
regulatory obligations.
    \8\ See Regulatory Notice 13-26 (August 2013) and Securities
Exchange Act Release No. 69843 (June 25, 2013), 78 FR 39367 (July 1,
2013) (Notice of Filing and Immediate Effectiveness of a Proposed
Rule Change Relating to Members' Filing Obligations Under FINRA Rule
5123 (Private Placements of Securities) File No. SR-FINRA-2013-026).
    \9\ See Regulatory Notice 17-17 (April 2017) and Securities
Exchange Act Release No. 80321 (March 28, 2017), 82 FR 16245 (April
3, 2017) (Notice of Filing and Immediate Effectiveness of a Proposed
Rule Change Relating to the Private Placement Filer Form Under FINRA
Rules 5122 and 5123 File No. SR-FINRA-2017-008).
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    The proposed changes would represent the fourth version of the
Filer Form since Rule 5123 became effective in 2012. Updates to the
Filer Form would assist FINRA in fulfilling its regulatory
responsibilities by improving the quality of information that is filed
with it about the private placement and the member's role in offering
the securities. Specifically, FINRA proposes to clarify questions that
may have been unclear to members, and add other questions that, with
the benefit of experience, FINRA believes would help it better
understand the issues and potential risks associated with a private
placement.
    The Filer Form has three main components: (1) The ``Participating
Member Information'' section, which seeks information about the members
that are selling the private placement; (2) the ``Issuer Information''
section, which captures basic information about the issuer; and (3) the
``Offering Information'' section, which seeks information about the
offering.\10\
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    \10\ FINRA staff also monitor SEC and FINRA disciplinary actions
involving private placements. This monitoring enables FINRA to
identify issues that frequently occur in private placements.
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    FINRA proposes changes to the Filer Form that would add or clarify
questions or other information requested in the Offering Information
section. The benefit to members and FINRA would be twofold. When a
FINRA review of the submitted Filer Form identifies a potential concern
or a need for additional information, it typically leads to follow-up
questions by FINRA staff. These inquiries absorb members' and FINRA's
resources. The proposed changes to the Filer Form would provide more
focused and complete information that, in many cases, would obviate the
need for these follow-up inquiries. In addition, the proposed changes
would enable FINRA to get better information about those issues in
private placement transactions that have presented the most risk in
disciplinary cases.
    The proposed changes address three key categories of offering
information that can benefit from more focused or complete information
in the Offering Information section of the Filer Form: (i) Contingency
offerings; (ii) the disciplinary history of the issuer, its principals
and related parties; and (iii) the use of proceeds.
    FINRA also proposes to add a new question regarding FINRA Rule 3280
(Private Securities Transactions of an Associated Person). In addition,
FINRA proposes updates to existing questions regarding the member's
date of first sale or offer, the Securities Act registration exemptions
that apply and what type of documents are being filed with FINRA.
    The Filer Form does not set standards of disclosure or information
gathering requirements for members that participate in private
placements.\11\ Rather, the information provided by members on the
Filer Form assists FINRA in focusing its review on the areas of
heightened concern in the private placement market. Based on a review
of private placement enforcement actions from 2016 to 2018, FINRA found
frequent violations resulting from improper contingency
arrangements,\12\ inadequate investigations concerning disciplinary
history \13\ and the issuer's intended use of proceeds,\14\ and private
offerings sold by associated persons away from their firm without
proper authorization and oversight.\15\
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    \11\ The scope of a member's obligations to conduct a reasonable
investigation of a private placement is addressed in Regulatory
Notice 10-22 (April 2010). FINRA Rules 5122 and 5123 and the Filer
Form do not impose any additional requirement of reasonable
investigation beyond what is discussed in that Notice.
    \12\ FINRA has found that members failed to safeguard investor
funds in offerings that were subject to certain conditions to close
or failed to return funds to investors as required when the issuer
made material changes to the terms of the contingency or offering.
See, e.g., McDonald Partners LLC, FINRA AWC No.<PHONE_NUMBER>601
(February 21, 2018); Financial America Securities, Inc., FINRA AWC
No.<PHONE_NUMBER>601 (May 26, 2016); Dawson James Securities, Inc.,
FINRA AWC No.<PHONE_NUMBER>901 (February 07, 2017); TerraNova Capital
Equities, Inc., FINRA AWC No.<PHONE_NUMBER>301 (December 21, 2017).
    \13\ In recent cases, including those involving fraud, FINRA has
found that members did not meet their obligation to conduct a
reasonable investigation of the offering when they failed to
identify or follow up on areas of heightened concern regarding the
background of the issuer, its principals, or related parties. See,
e.g., First American Securities, Inc., FINRA AWC No.<PHONE_NUMBER>405
(November 7, 2016); Richard Gomez, FINRA NAC Decision No.
2011030293503 (March 28, 2018); Carolina Financial Securities, LLC
and Bruce V. Roberts, FINRA OHO Decision No.<PHONE_NUMBER>201 (May 26,
2017).
    \14\ In recent cases, including those involving fraud, FINRA has
found that members did not meet their obligation to conduct a
reasonable investigation of the offering when they failed to review
or follow up on areas of heightened concern regarding related party
transactions or the issuer's intended use of proceeds. See, e.g.,
Harold Lee Connell, FINRA AWC No.<PHONE_NUMBER>702 (June 12, 2018);
Carolina Financial Securities, LLC and Bruce V. Roberts, FINRA OHO
Decision No.<PHONE_NUMBER>201 (May 26, 2017); Bridge Capital
Associates, Inc., FINRA AWC No.<PHONE_NUMBER>801 (December 12, 2016).
    \15\ See, e.g., First American Securities, Inc., FINRA AWC No.
2015046056405 (November 7, 2016); Richard Gomez, FINRA NAC Decision
No.<PHONE_NUMBER>503 (March 28, 2018); Ahmed Ghassan Gheith, FINRA AWC
No.<PHONE_NUMBER>603 (April 24, 2018); Brandon D. Gioffre, FINRA AWC
No.<PHONE_NUMBER>701 (June 23, 2016).
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    The proposed Filer Form changes would help address these concerns
and streamline the existing information collection procedure that FINRA
relies on to fulfill its regulatory responsibility related to private
placements.
    The questions in the Offering Information section of the Filer Form
can generally be answered either by: (i) Inputting requested
information or responding ``unknown''; or (ii) checking one of three
``radio buttons'' for ``yes,'' ``no,'' or ``unknown.'' The proposed
changes to the Filer Form would not alter this general approach.
Members would continue to have the option to respond ``unknown'' to
each proposed new or revised question or request for information.
Therefore, the Filer Form, as proposed to be modified, would not impose
any new obligation on members to seek out information that they do not

already have.\16\ FINRA also notes that the Filer Form provides (and
would continue to provide) a free text box at the end of the form for
members that wish to clarify their answers or add other relevant
information with regard to particular questions or requests for
information.
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    \16\ The Filer Form provides that the member submitting the
filing must answer the questions ``[b]ased on the information
contained in the offering document (or if otherwise known by your
firm).''
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Contingency Offerings
    The proposed changes to the Offering Information section would add
and clarify several questions regarding contingency offerings; \17\
FINRA continues to observe numerous instances of non-compliance with
this type of offering.\18\ The Filer Form today asks if the contingency
has been met at the time of filing. The proposed changes to the Filer
Form would add three additional questions/requests if the offering is a
contingency offering, each with the option to respond ``unknown'': (1)
A request for the member to provide the date by which the contingency
must be met; (2) a question asking if there have been any changes to
the original terms of the contingency during the course of the offering
(e.g., extension of the date by which the contingency must be met);
\19\ and (3) a question regarding whether ``the subscription process
involves your firm receiving or transmitting investor funds in the
offering''. This last question would provide FINRA with transparency
regarding whether the broker-dealer is subject to the requirements for
handling funds under SEA Rule 15c2-4.\20\ If the member responds
``yes'' to this last question, the Filer Form would ask if ``your firm
is acting as the agent or trustee for investor funds until the
contingency is met.'' The terms ``agent or trustee'' are used in SEA
Rule 15c2-4, which governs the manner in which a member must handle
investors' funds in a contingency offering. If the member responds
``yes'' or ``unknown'' there would be no more questions. If the member
responds ``no,'' the Filer Form would require the member to provide the
name of the escrow agent in a free text box or respond ``unknown.''
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    \17\ For purposes of the Filer Form, a contingency offering is a
private placement in which the closing or sale of securities in the
private placement is contingent on an event or condition, typically
the receipt of orders for a minimum aggregate dollar amount or
number of securities by an expiration date. Members participating in
contingency offerings must understand and comply with the
requirements of SEA Rules 10b-9 and 15c2-4. See Private Placement
FAQ #1 under the heading ``Filing Form'' available on the finra.org
website.
    \18\ See Regulatory Notice 16-08 (February 2016). FINRA's review
of securities offering documents has revealed instances in which
broker-dealers have not complied with the contingency offering
requirements of SEA Rules 10b-9 and 15c2-4. In the Notice, FINRA
provided guidance regarding the requirements of SEA Rules 10b-9 and
15c2-4 and reminded broker-dealers of their responsibility to have
procedures reasonably designed to achieve compliance with these
rules.
    \19\ As noted, the member submitting the Filer Form must answer
the questions ``[b]ased on the information contained in the offering
document (or if otherwise known by your firm).'' The member may
provide further information in the free text box at the end of the
Filer Form.
    \20\ Rule 15c2-4 requires that upon receiving money or other
consideration from an investor in a contingency offering, a broker-
dealer must promptly either (1) deposit those funds into ``a
separate bank account'' for which the broker-dealer is the account
holder and is designated as agent or trustee; or (2) transmit those
funds to a bank that has agreed in writing to act as the escrow
agent for the offering.
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Disciplinary History
    The Offering Information section also would be revised to add
questions regarding disciplinary history. Currently, the Filer Form
asks whether the issuer, any officer, director or executive management
of the issuer, sponsor, general partner, manager, advisor, or any of
the issuer's affiliates has been the subject of SEC, FINRA or state
disciplinary actions or proceedings or criminal complaints within the
last 10 years. The proposed revisions to the Filer Form would change
the current question to also inquire about ``other federal agency''
disciplinary actions (in addition to SEC, FINRA and state disciplinary
actions or proceedings or criminal complaints) within the last 10
years. If the member responds ``yes'' to the revised question, the
Filer Form would request the identification of the individual or entity
that was the subject of such action or allow the member to respond
``unknown.'' For each identified entry, the proposed revisions to the
Filer Form would first ask whether the individual or entity has
registration records in the Central Registration Depository
(``CRD[supreg]''). If the member responds ``yes'' to the CRD question,
then the member would enter the name of the individual or entity with
no more questions.\21\ If instead the member responds ``no'' or
``unknown'' to the CRD question, the Filer Form would request that the
member provide the name of the individual or entity with the
disciplinary history or respond ``unknown.'' If the member provides the
name of the entity or individual with the disciplinary history, the
Filer Form's next requests would be for three pieces of information,
each of which includes the option to select ``unknown'': (1) The type
of action or proceeding (that may be selected from a drop down box);
(2) the approximate year that the event was initiated; and (3) the
status of the event (that may be selected from a list of options
provided in a drop down box). While the information requested in these
three questions would assist FINRA's review of an area of concern,
FINRA recognizes that by providing the unknown option, it is possible
that some members may not possess definitive information needed to
answer the questions. If the member responds ``unknown'' when requested
to provide the name of the entity or individual with the disciplinary
history, there are no more questions.
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    \21\ Using the ``CRD lookup'' function, the member selects
whether the subject is an individual or entity, then enters either
the name or CRD number and selects the appropriate result to
generate the name and CRD number in the Filer Form.
---------------------------------------------------------------------------

Use of Proceeds
    The Offering Information section would be revised to include a
reformulation of the existing request for information regarding the use
of the offering proceeds. Currently, the Filer Form asks whether the
issuer is ``able to'' use offering proceeds to make or repay loans to,
or purchase assets from any officer, director or executive management
of the issuer, sponsor, general partner, manager, advisor or any of the
issuer's affiliates. The proposed changes to the Filer Form would re-
formulate the current question by asking whether the issuer ``intends
to'' use (rather than is ``able to'' use) \22\ offering proceeds to
make or repay loans to, or purchase assets from, the listed persons.
The proposed changes to the Filer Form also would expand the scope of
the current question by asking whether the issuer intends to
``otherwise direct investor proceeds'' to the listed persons. The
question would retain the option to respond ``unknown.'' If the member
responds ``yes'' to this question despite the option to respond
``unknown,'' the proposed changes to the Filer Form would add a request
for the member to identify the type(s) of payment(s) and the
approximate dollar amount, and would provide the option to respond
``unknown.''
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    \22\ The replacement of ``able to use'' with ``intends to use''
is meant to clarify the question, which seeks information about the
member's understanding of the issuer's intended use of proceeds. It
would not constitute a substantive change to the information
required by the Filer Form.
---------------------------------------------------------------------------

Private Securities Transactions
    The Offering Information section would be revised to add a question
regarding identification of private securities transactions. FINRA
seeks to have more information regarding how frequently private
offerings are sold by

associated persons away from their firm. The proposed changes to the
Filer Form would ask ``if your firm is filing an offering that your
associated person is selling in a private securities transaction
subject to FINRA Rule 3280''.\23\ The member may respond ``yes'',
``no'' or ``unknown.''
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    \23\ FINRA Rule 3280 (Private Securities Transactions of an
Associated Person) requires, prior to participating in any private
securities transaction, an associated person to provide written
notice to the member with which he is associated describing in
detail the proposed transaction and the person's proposed role
therein, including if compensation will be received. In the case of
a transaction in which the associated person may receive selling
compensation, that transaction must be approved in writing by the
member.
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Information Clarification and Accuracy Improvement
    Finally, FINRA proposes minor changes to three existing questions
in the Offering Information section of the Filer Form in order to
clarify the information requested and improve the accuracy of
responses. The first proposed change is to the current questions
concerning the member's date of first sale or offer, which FINRA relies
upon to assess the timeliness of the filings. For Rule 5123 filings,
the current Filer Form requests that the member provide the date of its
first sale in the offering (by way of a calendar box) or respond
``unknown,'' and separately instructs the member to check a box if
sales have yet to commence. These questions would be replaced with
``Has your firm commenced sales of the offering?'' The member may
respond ``yes,'' ``no,'' or ``unknown.'' If the member has answered
``yes'' that it commenced sales, the Filer Form would request that the
member enter the date of first sale or respond ``unknown.'' Likewise,
for Rule 5122 filings, the current Filer Form requests that the member
provide the date of first offer (by way of a calendar box) or respond
``unknown,'' and separately instructs the member to check a box if
sales have yet to commence. These questions would be replaced with
``Has your firm made any offers for the private placement or otherwise
provided the offering documents to any investor?'' As with the Rule
5123 filings, the member may respond ``yes,'' ``no,'' or ``unknown.''
If the member has answered ``yes,'' the Filer Form would request the
member enter the date of first offer or provision of offering documents
to any investor or respond ``unknown.''
    Second, the proposed changes to the Offering Information section
would update the options that a member may select when answering what
exemption from registration the issuer is relying upon. The current
question allows the member to select Rule 505. Rule 505 was repealed in
2016 and is no longer an available exemption; therefore, the Filer Form
would remove that option.\24\
---------------------------------------------------------------------------

    \24\ See Securities Act Release No. 10238 (October 26, 2016), 81
FR 83494 (November 21, 2016).
---------------------------------------------------------------------------

    Third, the proposed changes to the Filer Form would amend the
process by which the member uploads offering documents that it used in
connection with the sale of the offering. For each document the member
uploads, the Filer Form would request that the member identify the type
of document by selecting an option from a drop down box (e.g., private
placement memorandum or term sheet) with an option to identify the
document as ``other'' and the option to select multiple types of
documents (e.g., indicate that the document is a term sheet and a
private placement memorandum).
Conclusion
    As noted above, the proposed revisions to the Filer Form would
assist FINRA in fulfilling its regulatory responsibilities by improving
the quality of information that is filed with it about the private
placement and the member's role in offering the securities.
Specifically, FINRA proposes to clarify questions that may have been
unclear to members, and add other questions that, with the benefit of
experience, FINRA believes would help it better understand the issues
and potential risks associated with a private placement (e.g., an
offering with an unmet contingency, an issuer with disciplinary history
or associated persons' selling private offerings away from their
firms). In addition, the proposed new questions should in many cases
obviate the need for follow-up questions after filing and would
therefore streamline the existing information collection procedure that
FINRA relies on to fulfil its regulatory responsibilities related to
private placements.
    FINRA has filed the proposed changes for immediate effectiveness.
FINRA anticipates that the implementation date will be May 22, 2021.
2. Statutory Basis
    FINRA believes that the proposed changes to the Filer Form are
consistent with the provisions of Section 15A(b)(6) of the Act,\25\
which requires, among other things, that FINRA rules must be designed
to prevent fraudulent and manipulative acts and practices, to promote
just and equitable principles of trade, and, in general, to protect
investors and the public interest, in that it will assist in FINRA's
efforts to detect and prevent fraud in connection with specified
private placements. In addition, the proposed changes would assist
FINRA in evaluating the specified private placement activities of
members and assess whether members are conducting a reasonable
investigation and whether members are complying with private placement
obligations including regarding contingency offerings for private
placement offerings in which they participate.
---------------------------------------------------------------------------

    \25\ 15 U.S.C. 78o-3(b)(6).
---------------------------------------------------------------------------

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

    FINRA has undertaken an economic impact assessment, as set forth
below, to analyze the regulatory need for the proposed changes, their
potential economic impacts, including anticipated costs, benefits, and
competitive effects, relative to the current baseline, and the
alternatives FINRA considered in assessing how best to meet FINRA's
regulatory objectives.
Regulatory Need
    The proposed Filer Form changes are intended to streamline the
existing information collection procedure in fulfilling FINRA's
regulatory responsibility related to private placements. In particular,
in connection with its review of submitted Filer Forms, FINRA spends
significant time and resources in making follow-up inquiries to members
in areas of heightened concern, including terms of contingency
offerings, disciplinary history, and use of proceeds after members
submit the Filer Form. Constraints of regulatory resources in this
process may lead to unnecessary or prolonged reviews and
investigations, thereby imposing extra costs and regulatory uncertainty
for members.\26\ These constraints may even hinder FINRA's ability to
detect fraudulent acts and practices in an accurate and timely manner.
---------------------------------------------------------------------------

    \26\ The private placement filing requirement is a notice filing
only and members do not wait for approval from FINRA in connection
with a private placement. If FINRA asks questions of the member in
response to its filing, the member may become concerned that there
may be a potential compliance issue with the private placement.
---------------------------------------------------------------------------

Economic Baseline
    The economic baseline for the proposed changes is the current Filer
Form under FINRA Rules 5122 and 5123, and FINRA's existing private
placement regulatory procedure. FINRA has collected information
detailing

2,353 private placement filings submitted by 394 members with initial
filing dates between May 1, 2019 and May 1, 2020. The average (maximum)
number of filings per member is 6 (157) during the period.\27\ Of the
2,353 filings, 48% provided ``yes'' answers to at least one of the
three existing questions identifying whether the filing relates to a
contingency offering; whether the issuer, its principals or related
parties have disciplinary histories; and whether offering proceeds may
be used by the issuer or related parties for certain identified
purposes.\28\
---------------------------------------------------------------------------

    \27\ Among the filing members, 70% of them are frequent filers
who had also filed at least one private placement filing during the
period of May 1, 2018 and May 1, 2019.
    \28\ The rest of the filings provided either ``no'' or
``unknown'' answers to these questions.
---------------------------------------------------------------------------

    According to the current regulatory procedure, FINRA reviews the
information provided in the Filer Form along with other data to
determine the risk profile of a private placement through its triage
program. In the case in which an offering receives a high-risk
assessment, FINRA initiates a further review and gathers details about
the private placement. FINRA also frequently conducts informational
inquiries to members if a review raises further concern and leads to a
FINRA investigation. Because of the time and resources needed to
respond, these regulatory inquiries can be costly to members. These
inquiries also tend to require significant regulatory resources, cause
delays in FINRA reviews and investigations, and impose extra
communication costs and regulatory uncertainty on members after the
filing process.
Economic Impacts
    The proposal would add questions in the Filer Form with the option
to answer ``unknown'' pertaining to the issues of heightened concern
including contingency offerings, disciplinary history, use of proceeds,
and private offerings sold by associated persons away from their
firms.\29\ In cases where members choose to provide additional
information, the further questions or requests for information at the
outset would shift the responsibility of information collection on the
key issues from FINRA (after the filing) to these members (upon
filing). FINRA believes that these members already know the requested
information and accordingly would have no increases in relevant costs
of information collection or would face relatively low costs of
information collection if they do not already know the requested
information and perform additional investigation to determine it,
instead of answering ``unknown.'' Subsequent regulatory inquiries to
obtain such information based on the existing Filer Form, in
comparison, could require significant FINRA resources and impose higher
costs and regulatory uncertainty on these members. The proposal could
therefore reduce information collection costs as a whole for FINRA and
members by avoiding regulatory inquiries to obtain the information
requested in the new proposed questions, and thereby streamlining the
regulatory process.
---------------------------------------------------------------------------

    \29\ As mentioned earlier, the proposal would also make minor
changes to clarify existing questions and improve the accuracy of
responses in the Filer Form.
---------------------------------------------------------------------------

    The proposal would also help FINRA better understand the scope and
severity of existing high-risk matters in private placements. By
allowing access to additional information in areas of heightened
concern, the proposal would assist FINRA in refining its triage
program, thereby extending its ability to assess risk profiles and
detect fraudulent and manipulative acts and practices in these areas.
FINRA believes that members may likely benefit from fewer unnecessary
reviews and shortened review and investigation cycles due to a
streamlined regulatory process and enhanced regulatory insights. The
proposal's benefits, however, may vary depending on how frequently
additional information is provided rather than ``unknown'' responses to
the new questions in the Filer Form following the proposal.
    The proposed amendments could minimally increase the costs of
collecting and providing additional information for members who answer
``yes'' to one of the three existing questions regarding contingency
offerings, the disciplinary history of the issuer, its principals and
related parties, and the use of proceeds. FINRA believes that this cost
increase to members, however, is relatively low overall compared with
the benefit they would receive from reduced regulatory communication
costs and uncertainty. In addition, members that would choose to
provide ``unknown'' answers to each new question would not be subject
to such a cost increase. FINRA does not expect cost increases will
deter member entry to the industry or private placement offerings or
result in any significant burden on competition that is not necessary
or appropriate in furtherance of the purpose of the Act.
Alternatives Considered
    An alternative considered by FINRA was to prohibit ``unknown''
responses in the Filer Form. This alternative may lead to greater
benefit, for example, from efficiencies in regulatory procedure and
enhanced regulatory insights into high-risk matters. However, FINRA
believes that the alternative would pose higher information collection
costs on members. The proposal, therefore, permits ``unknown''
responses. Members may, however, choose to expend effort and incur
associated costs with collecting and reporting additional information.

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

    Written comments were neither solicited nor received.

III. 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) of the Act \30\ and Rule 19b-
4(f)(6) thereunder.\31\
---------------------------------------------------------------------------

    \30\ 15 U.S.C. 78s(b)(3)(A).
    \31\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    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-FINRA-2021-002 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-FINRA-2021-002. 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, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of such filing also will be available for inspection
and copying at the principal office of FINRA. 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-FINRA-2021-002 and should be submitted
on or before March 2, 2021.
---------------------------------------------------------------------------

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

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\32\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-02588 Filed 2-8-21; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 239 (Thursday, December 12, 2019)]
[Notices]
[Pages 68008-68009]
[FR Doc No: 2019-26744]

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DEPARTMENT OF TRANSPORTATION

Federal Railroad Administration

[Docket Number FRA-2012-0091]

Petition for Waiver of Compliance

    Under part 211 of title 49 Code of Federal Regulations (CFR), this
document provides the public notice that by a letter dated November 22,
2019, Montana Rail Link, Inc. (MRL) petitioned the Federal Railroad
Administration (FRA) to include MRL in a waiver of compliance from
certain provisions of the Federal railroad safety regulations contained
at 49 CFR part 232, Brake System Safety Standards for Freight and Other
Non-Passenger Trains and Equipment. FRA assigned the petition Docket
Number FRA-2012-0091.
    Specifically, MRL seeks relief with respect to the application of
49 CFR 232.205(c)(1), Class I brake test-initial terminal inspection,
and Sec.  232.207(b)(1), Class IA brake tests--1,000-mile inspection,
for trains operating in distributive power mode. MRL requests to extend
the maximum allowable brake pipe air flow from the present regulatory
limit of 60 cubic feet per minute (CFM) to 90 CFM for distributed
power-equipped trains under specified operating conditions.
    On March 26, 2013, FRA granted a pilot test waiver to the BNSF
Railway Company for these same provisions. Canadian National Railway
and Canadian Pacific Railway were added as parties to the test waiver
on November 21, 2014, and Union Pacific Railroad was added as a party
on March 4, 2015. On May 3, 2017, FRA granted a change in status from a
test waiver to a waiver of compliance, and on February 8, 2019, CSX
Transportation, Inc. was added to the waiver. MRL requests to be a
party to the same waiver. If granted, MRL would be subject to the same
conditions as set forth in FRA's May 3, 2017 letter.
    A copy of the petition, as well as any written communications
concerning the petition, is available for review online at
www.regulations.gov and in person at the U.S. Department of
Transportation's (DOT) Docket Operations Facility, 1200 New Jersey Ave.
SE, W12-140, Washington, DC 20590. The Docket Operations Facility is
open from 9 a.m. to 5 p.m., Monday through Friday, except Federal
Holidays.
    Interested parties are invited to participate in these proceedings
by submitting written views, data, or comments. FRA does not anticipate
scheduling a public hearing in connection with these proceedings since
the facts do not appear to warrant a hearing. If any interested parties
desire an opportunity for oral comment and a public hearing, they
should notify FRA, in writing, before the end of the comment period and
specify the basis for their request.
    All communications concerning these proceedings should identify the
appropriate docket number and may be submitted by any of the following
methods:
     Website: http://www.regulations.gov. Follow the online
instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: Docket Operations Facility, U.S. Department of
Transportation, 1200 New Jersey Ave. SE, W12-140, Washington, DC 20590.
     Hand Delivery: 1200 New Jersey Ave. SE, Room W12-140,
Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday,
except Federal Holidays.
    Communications received by January 27, 2020 will be considered by
FRA before final action is taken. Comments received after that date
will be considered if practicable.
    Anyone can search the electronic form of any written communications
and comments received into any of our

dockets by the name of the individual submitting the comment (or
signing the document, if submitted on behalf of an association,
business, labor union, etc.). Under 5 U.S.C. 553(c), DOT solicits
comments from the public to better inform its processes. DOT posts
these comments, without edit, including any personal information the
commenter provides, to www.regulations.gov, as described in the system
of records notice (DOT/ALL-14 FDMS), which can be reviewed at https://www.transportation.gov/privacy. See also https://www.regulations.gov/privacyNotice for the privacy notice of regulations.gov.

    Issued in Washington, DC.
John Karl Alexy,
Associate Administrator for Railroad Safety, Chief Safety Officer.
[FR Doc. 2019-26744 Filed 12-11-19; 8:45 am]
BILLING CODE 4910-06-P