[Federal Register Volume 87, Number 144 (Thursday, July 28, 2022)]
[Notices]
[Pages 45382-45387]
[FR Doc No: 2022-16149]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-95354; File No. SR-NYSE-2022-32]

Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing of Proposed Rule Change to Amend Rule 7.35B Relating
to the Closing Auction and Make Certain Conforming and Non-Substantive
Changes to Rule 7.31, Rule 7.35, Rule 7.35B and Rule 104

July 22, 2022.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that, on July 13, 2022, New York Stock Exchange LLC (``NYSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the self-regulatory
organization. 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to (1) amend Rule 7.35B (DMM-Facilitated
Closing Auctions) relating to the Closing Auction, and (2) make certain
conforming and non-substantive changes to Rule 7.31 (Orders and
Modifiers), Rule 7.35, Rule 7.35B and Rule 104 (Dealings and
Responsibilities of DMMs). The proposed rule change is available on the
Exchange's website at www.nyse.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

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

1. Purpose
    The Exchange proposes to (1) amend Rule 7.35B (DMM-Facilitated
Closing Auctions) relating to the Closing Auction,\4\ and (2) make
certain conforming and non-substantive changes to Rule 7.31 (Orders and
Modifiers), Rule 7.35, Rule 7.35B and Rule 104 (Dealings and
Responsibilities of DMMs).
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    \4\ Capitalized terms used in connection with Auctions on the
Exchange are defined in Rule 7.35(a).
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    Overview of Current Closing Auction Process
    The following current rules describe the Closing Auction process on
the Exchange:
     Rule 7.31 (identifying the order types eligible to
participate in an Auction);
     Rule 7.35 (general rules and definitions applicable to
Auctions);
     Rule 7.35B (describing the process for DMM-facilitated
Closing Auctions);
     Rule 7.35C (describing the process for Exchange-
facilitated Auctions); and
     Rule 104 (establishing DMM obligations with respect to
Closing Auctions and trading leading into the Closing Auction).
    The following interest is eligible to participate in a Closing
Auction:
     unexecuted buy and sell orders resting on the Exchange
Book at the end of Core Trading Hours (including DMM Orders); \5\
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    \5\ Rule 7.35(a)(9) defines ``DMM Interest'' for purposes of
Auctions to mean all buy and sell interest entered by a DMM unit in
its assigned securities and includes the following: (i) ``DMM
Auction Liquidity,'' which is non-displayed buy and sell interest
that is designated for an Auction only (see Rule 7.35(a)(9)(A));
(ii) ``DMM Orders,'' which are orders, as defined under Rule 7.31,
entered by a DMM unit (see Rule 7.35(a)(9)(B)); and (iii) ``DMM
After-Auction Orders,'' which are orders entered by a DMM unit
before either the Core Open Auction or Trading Halt Auction that do
not participate in an Auction and are intended instead to maintain
price continuity with reasonable depth following an Auction (see
Rule 7.35(a)(9)(C)).
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     Auction-Only Orders; \6\ and
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    \6\ Auction-Only Orders available for the Closing Auction are
defined in Rule 7.31(c)(2)(A)-(D) as the Limit-on-Close Order (``LOC
Order''), Market-on-Close Order (``MOC Order''), Closing D Order,
and Closing Imbalance Offset Order (``Closing IO Order'').

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     DMM Auction Liquidity entered by the DMM in connection
with facilitating the Closing Auction.\7\
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    \7\ In 2021, the Commission approved changes to Rule 7.35B
providing that Floor Broker Interest is no longer eligible to
participate in the Closing Auction. See Securities Exchange Act
Release No. 92480 (July 23, 2021), 86 FR 40886 (July 29, 2021) (SR-
NYSE-2020-95) (``Floor Broker Interest Approval Order''). The term
``Floor Broker Interest'' is defined in Rule 7.35(a)(10) to mean
orders represented orally by a Floor broker at the point of sale. In
light of the Floor Broker Interest Approval Order, the Exchange
proposes conforming changes to Rules 7.35B(c)(1)(B), Rule
7.35B(j)(2) and Rule 7.35B(j)(2)(A)(iii). Specifically, Rule
7.35B(c)(1)(B) provides that a DMM may not effect a Closing Auction
electronically if, among other things, Floor Broker Interest for the
Closing Auction that has been electronically entered or requested to
be cancelled has not yet been accepted by the DMM. Rule 7.35B(j)(2)
provides that, to avoid closing price dislocation that may result
from an order entered into Exchange systems or represented to a DMM
orally at or near the end of Core Trading Hours, the Exchange may
temporarily suspend the requirement to enter all order instructions
by the end of Core Trading Hours. Because the Exchange has
eliminated Floor Broker Interest at the close, the Exchange proposes
to delete Rule 7.35B(c)(1)(B) in its entirety. The remaining
subsections of Rule 7.35B(c)(1) would be renumbered accordingly and
the Exchange proposes conforming changes to Rule 7.35B(j)(1)(A) and
(B) to update the cross references from Rule 7.35B(c)(1)(G) to Rule
7.35B(c)(1)(F). For the same reasons, the Exchange proposes to
delete the phrase ``or represented to a DMM orally'' in Rule
7.35B(j)(2) and the phrase ``and Floor Broker Interest'' in Rule
7.35B(j)(2)(A)(iii).
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    Beginning 10 minutes before the scheduled end of Core Trading
Hours, the Exchange begins disseminating through its proprietary data
feed Closing Auction Imbalance Information that is calculated based on
the interest eligible to participate in the Closing Auction.\8\ The
Closing Auction Imbalance Information includes the Continuous Book
Clearing Price, which is the price at which all better-priced orders
eligible to trade in the Closing Auction on the Side of the Imbalance
can be traded.\9\ The Closing Auction Imbalance Information also
includes an Imbalance Reference Price, which is the Exchange Last Sale
Price bound by the Exchange BBO.\10\ Beginning five minutes before the
end of Core Trading Hours, Closing D Orders are included in the Closing
Auction Imbalance Information at their undisplayed discretionary
price.\11\ The Closing Auction Imbalance Information is updated at
least every second, unless there is no change to the information, and
is disseminated until the Closing Auction begins.\12\ In addition, if
at the Closing Auction Imbalance Freeze Time \13\ the Closing Imbalance
\14\ is 500 round lots or more, the Exchange will disseminate a
Regulatory Closing Imbalance to both the securities information
processor and proprietary data feeds.\15\
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    \8\ See Rule 7.35B(e)(1)(A). DMM Orders, as defined in Rule
7.35(d)(9)(B), that have been entered by the DMM in advance of a
Closing Auction are currently included in the Closing Auction
Imbalance Information.
    \9\ See Rule 7.35(a)(4)(C). In the case of a buy Imbalance, the
Continuous Book Clearing Price would be the highest potential
Closing Auction Price and in the case of a sell Imbalance, the
Continuous Book Clearing Price would be the lowest potential Closing
Auction Price.
    \10\ See Rule 7.35B(e)(3).
    \11\ See Rule 7.35(b)(1)(C)(ii).
    \12\ See Rule 7.35(c)(1) and (2).
    \13\ See Rule 7.35(a)(8) (defining the ``Closing Auction
Imbalance Freeze Time'' to be 10 minutes before the scheduled end of
Core Trading Hours).
    \14\ As defined in Rule 7.35(a)(4)(A)(ii), a ``Closing
Imbalance'' means the Imbalance of MOC and LOC Orders to buy and MOC
and LOC Orders to sell. That Rule further defines a ``Regulatory
Closing Imbalance'' as a Closing Imbalance disseminated at or after
the Closing Auction Imbalance Freeze Time.
    \15\ See Rule 7.35B(d)(1).
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    Pursuant to Rule 104(a)(3), Designated Market Makers (``DMM'') have
the responsibility to facilitate the close of trading for each of the
securities in which the DMM is registered as required by Exchange
rules, which may include supplying liquidity as needed. Rule 104(a)(3)
further provides that DMMs and DMM unit algorithms have access to
aggregate order information in order to comply with their requirement
to facilitate the close of trading for each of the securities in which
the DMM is registered. Accordingly, aggregate order information about
all orders eligible to participate in the Closing Auction, including
the full quantity of Reserve Orders \16\ and MOC and LOC Order
quantities, are available to DMMs at each price point. This information
is available at the point of sale to DMMs. In addition, it is made
available to DMM unit algorithms in connection with the electronic
message sent to a DMM unit algorithm to close an assigned security
electronically, which is sent shortly after the end of Core Trading
Hours.
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    \16\ Reserve Orders, including the non-displayed reserve
interest of such orders, are eligible to participate in the Closing
Auction. See, e.g., Rule 7.35B(h)(2)(B) (describing the allocation
ranking of at-priced orders ranked Priority 3--Non-Displayed Orders,
which refers to the reserve interest of Reserve Orders).
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    Rule 7.35B specifies the process for DMM-facilitated Closing
Auctions. Pursuant to Rule 7.35B(a), it is the responsibility of each
DMM to ensure that registered securities close as soon after the end of
Core Trading Hours as possible, while at the same time not unduly
hasty, particularly when at a price disparity from the Exchange Last
Sale Price.\17\ As provided for in Rule 7.35B(a)(2), a DMM may enter or
cancel DMM Interest after the end of Core Trading Hours in order to
supply liquidity as needed to meet the DMM's obligation to facilitate
the Closing Auction in a fair and orderly manner, and entry of DMM
Interest after the end of Core Trading Hours is not subject to Limit
Order Price Protection. Pursuant to Rule 7.35B(c), the DMM may
effectuate a Closing Auction manually or electronically. Rule 7.35B(g)
provides that the DMM is responsible for determining the Auction Price
for a Closing Auction and that if there is an Imbalance of any size,
the DMM must select an Auction Price at which all better-priced orders
on the Side of the Imbalance can be satisfied.
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    \17\ The term ``Exchange Last Sale Price'' is defined in Rule
7.35(a)(12)(B) to mean the most recent trade on the Exchange of a
round lot or more in a security during Core Trading Hours on that
trading day, and if none, the Official Closing Price from the prior
trading day for that security.
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    Rule 7.35C specifies the process for Exchange-facilitated Auctions
if a DMM cannot facilitate an Auction in one or more securities in
which the DMM is registered. DMM Interest does not participate in an
Exchange-facilitated Closing Auction trade.\18\
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    \18\ See Rule 7.35C(a)(1) (``If the Exchange facilitates an
Auction, DMM Interest will not be eligible to participate if such
Auction results in a trade, and will be eligible to participate if
such Auction results in a quote.'').
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Proposed Amendments to Rule 7.35B
    The Exchange proposes to amend Rule 7.35B to modify how the Closing
Auction Price would be determined by adding price parameters within
which the DMM must select a Closing Auction Price. As described in more
detail below, the proposed pricing parameters would be based on non-DMM
interest eligible to participate in the Closing Auction that was
included in the last-published Auction Imbalance Information. The
Exchange also proposes to modify how the DMM would participate in the
Closing Auction by cancelling any resting DMM Orders at the end of Core
Trading Hours. The Exchange does not propose to change the DMMs' Rule
104 obligation to facilitate the Closing Auction, including the
obligation to supply liquidity as needed. The Exchange believes that
the proposed changes would make the Closing Auction more transparent
and deterministic while retaining the DMMs' unique obligation to
facilitate the Closing Auction.
Proposed Changes to Closing Auction Price
    The Exchange proposes to amend Rule 7.35B(g) to add explicit price
parameters to the Closing Auction Price. As noted above, the DMM is
responsible for determining a Closing Auction Price that is able to
satisfy all better-priced orders on the Side of the Imbalance. This
requirement would not change.

The Exchange proposes to add that the Closing Auction Price determined
by the DMM must also be at a price that is at or between the last-
published Imbalance Reference Price and the last-published Continuous
Book Clearing Price. Specifically, the Exchange proposes to amend Rule
7.35B(g) as follows (proposed changes italicized):
    (g) Determining an Auction Price. The DMM is responsible for
determining the Auction Price for a Closing Auction under this Rule.
    (1) If there is an Imbalance of any size, the DMM must select an
Auction Price at which all better-priced orders on the Side of the
Imbalance can be satisfied.
    (2) The Auction Price must be at or between the last-published
Imbalance Reference Price and the last-published non-zero Continuous
Book Clearing Price.\19\
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    \19\ Rule 7.35(a)(4)(C) provides that if there is no Imbalance
of all orders eligible to trade in the Auction, the Continuous Book
Clearing Price will be the Imbalance Reference Price. The Exchange
proposes to amend this provision to clarify that if the Imbalance
Reference Price is in an increment smaller than the minimum price
variation (``MPV'') for the security (e.g., Exchange Last Sale Price
was a midpoint execution in a penny-spread security), it will be
rounded to the MPV for the specific security. The Exchange would
also make a conforming change to Rule 7.35B(c)(1)(G) (to be
renumbered F, see note 6, supra), which provides that a DMM may not
effect a Closing Auction electronically if the Closing Auction Price
will be more than 10% away from Exchange Last Sale Price. The
Exchange would replace Exchange Last Sale Price with last-published
Imbalance Reference Price.
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    The Exchange believes that adding this proposed Closing Auction
Price parameter is consistent with how the Closing Auction Price has
been determined for the vast majority of Closing Auctions. For example,
in the period January 1, 2021 to June 17, 2022, 95.6% of all Closing
Auctions were priced at or between the last-published Imbalance
Reference Price and Continuous Book Clearing Price. Similarly, during
this same period, 94.6% of closing auction volume priced within these
parameters. Moreover, 73.6% of the 4.4% of Closing Auctions that did
not price within those parameters closed at prices only one or two
cents away from those boundaries.\20\ More recent Closing Auction data
also shows that auctions executing within the proposed range resulted
in more representative prices for market participants.\21\ The Exchange
further believes that this proposed change would eliminate any
potential for a Closing Auction Price to be lower (higher) than the
last-published Imbalance Reference Price in the case of a Buy (Sell)
Imbalance. This proposed change would also promote transparency and
determinism with respect to the Closing Auction because the Closing
Auction Price would be required to be within a pre-determined range of
prices that have been disseminated via the Closing Auction Imbalance
Information and that cannot be changed after the end of Core Trading
Hours.\22\
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    \20\ More specifically, 59.6% were one cent away and 14.0% were
two cents away.
    \21\ During the last quarter of 2021 and year to date, 95.0% of
Closing Auctions occurred within the proposed pricing parameters.
These numbers did not materially change for volatile trading days.
For example, in the December 2021 quarterly rebalance, 96.5% of
Closing Auctions occurred within this range; in the March 2022
quarterly rebalance, 95.6% of Closing Auctions occurred within the
range. Closing Auctions pricing outside the range were mostly within
2 cents of the range; only 1% of all auctions occurred more than 2
cents outside the range. For instance, in the December 2021
quarterly rebalance, just 0.6% of all Closing Auctions occurred more
than 2 cents outside the range; in the more volatile March 2022
rebalance, just 1.2% of Closing Auctions occurred more than 2 cents
outside the range. More significantly, Closing Auctions executing
within the proposed range during the same period (excluding
rebalance days) were 11.3% closer to the consolidated two-minute
VWAP price benchmark than Closing Auctions that priced outside of
the proposed range, i.e., Closing Auctions executing within the
proposed range were more in-line with the range of continuous
trading leading into the close. And this was true for rebalance days
as well: during the December 2021 rebalance, Closing Auctions
executing within the proposed range were 14% closer to the VWAP
benchmark; during the March 2022 rebalance, Closing Auctions
executing within the proposed range were 40% closer to the VWAP
benchmark.
    \22\ The only circumstance when the Continuous Book Clearing
Price could change after the end of Core Trading Hours would be if
Rule 7.35B(j)(2)(A), described below, were invoked and the
requirement to enter all order instructions by the end of Core
Trading Hours were temporarily suspended for a security.
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Proposed Changes to How DMMs Would Participate in the Closing Auction
    The Exchange proposes to change how DMMs would be able to enter buy
and sell interest to participate in the Closing Auction by modifying
how a DMM could enter or cancel interest after the end of Core Trading
Hours.
    Currently, Rule 7.35B(a)(2) provides that a DMM may enter or cancel
DMM Interest after the end of Core Trading Hours in order to supply
liquidity as needed to meet the DMM's obligation to facilitate the
Closing Auction in a fair and orderly manner. Consistent with this
current Rule, the Exchange does not systematically block a DMM from
entering or cancelling DMM Interest after the end of Core Trading
Hours. Instead, the DMM's determination of whether to enter or cancel
DMM Interest after the end of Core Trading Hours is subject to the
DMM's obligation to maintain a fair and orderly market, as specified in
Rule 104.
    The Exchange proposes to amend Rule 7.35B(a)(2) to provide that
after the end of Core Trading Hours, a DMM may enter only DMM Auction
Liquidity in order to supply liquidity as needed to meet the DMM's
obligation to facilitate the Closing Auction in a fair and orderly
manner. With this proposed change, a DMM could enter DMM Auction
Liquidity after the end of Core Trading Hours only to close a security
within the proposed new price parameters, described above.\23\ Because
only DMM Auction Liquidity could be entered after the end of Core
Trading Hours, such interest could be entered either electronically in
response to the electronic message sent to a DMM unit algorithm to
close an assigned security or manually.
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    \23\ For example, if there is an Imbalance to buy, the Imbalance
Reference Price is $10.00, and the Continuous Book Clearing Price is
$10.10, the DMM could enter DMM Auction Liquidity to sell only at
prices ranging from $10.00 to $10.10. The Exchange does not propose
to systematically prescribe whether such interest must be offsetting
to the last-published Imbalance because DMM same-side interest could
result in more orders participating in the Closing Auction. For
example, DMM Auction Liquidity entered on the same side of the
Imbalance could result in greater liquidity being supplied by the
DMM to trade with at-priced orders, which are not included in the
calculation of the Imbalance. In such a scenario, even though the
DMM may be participating on the same-side of the imbalance, such
interest would not move the Closing Price outside the Continuous
Book Clearing Price.
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    The Exchange proposes that DMM Orders (i.e., DMM buy and sell
orders resting on the Exchange Book) would not be eligible to
participate in the Closing Auction.\24\ Because DMM Orders would not
participate in the Closing Auction, the Exchange further proposes that
such interest would not be included in the calculation of the
Continuous Book Clearing Price. With this change, the Continuous Book
Clearing Price would be based on non-DMM interest eligible to
participate in the Closing Auction. Finally, because resting DMM Orders
would not participate in the Closing Auction, the Exchange also
proposes to cancel DMM Orders at the end of Core Trading Hours.\25\ The
Exchange proposes a related amendment to delete the phrase ``or
cancel'' in the first sentence of Rule 7.35B(a)(2) as moot.
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    \24\ The Exchange also proposes to amend Rule
7.35B(j)(2)(A)(iii) to provide that DMM Orders would be rejected if
entered after the end of Core Trading Hours (i.e., during the
``Solicitation Period'') to offset an extreme order imbalance at or
near the close.
    \25\ The Exchange understands that it is current practice for
DMMs to cancel their DMM Orders at the end of Core Trading Hours.
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    To effect these changes, the Exchange proposes to amend Rule
7.35B(a)(2) as

follows (proposed additions italicized, proposed deletions bracketed):
    (2) DMM Interest: A DMM may enter [or cancel] DMM Auction
Liquidity[Interest] after the end of Core Trading Hours in order to
supply liquidity as needed to meet the DMM's obligation to facilitate
the Closing Auction in a fair and orderly manner. The entry of DMM
Auction Liquidity[Interest] after the end of Core Trading Hours will
not be subject to Limit Order Price Protection. DMM Orders will not be
eligible to participate in the Closing Auction, will not be included in
the calculation of the Continuous Book Clearing Price for the Closing
Auction, and will be cancelled at the end of Core Trading Hours.
    With this proposed change to Rule 7.35B(a)(2), in connection with
the Closing Auction, DMMs would still be required consistent with their
obligations under Rule 104 to contribute their own capital to supply
liquidity as needed to assist in the maintenance of a fair and orderly
market. In addition, DMMs would continue to have an obligation with
respect to determining a Closing Auction Price that satisfies all
better-priced orders on the Side of the Imbalance.
Proposed Conforming and Non-Substantive Amendments
    The Exchange proposes to amend Rule 104 to eliminate obsolete rule
text and update rule references, and make other conforming changes to
Rule 7.31 and Rule 104. The following proposed changes would not result
in any substantive changes to DMM obligations:
     The Exchange proposes to amend Rule 104(a)(2) to update
the cross reference from Rule 123D to Rule 7.35A and to use the Pillar
terms of ``Core Open Auctions and Trading Halt Auctions'' instead of
referring to ``openings.'' The Exchange also proposes to delete the
reference to Rule 13 and Reserve Order interest procedures at the
opening as obsolete. Finally, the Exchange proposes to delete the
reference to Supplementary Material .05 to Rule 104 with respect to
odd-lot order information to the DMM unit algorithm, as this is also
obsolete now that the Exchange trades on Pillar.
     The Exchange proposes to amend Rule 104(a)(3) to update
the cross reference from Rule 123C to Rule 7.35B and to use the Pillar
term of ``Closing Auctions'' instead of ``closes.'' The Exchange also
proposes to delete the reference to Rule 13 and Reserve Order interest
procedures at the close as obsolete.
     The Exchange proposes to amend Rule 104(b) by deleting
subparagraphs (2) and (6) and replacing the text for Rule 104(b)(2)
with the following: ``Unless otherwise specified in Rule 7.31, DMM unit
algorithms may use the orders and modifiers set forth in Rule 7.31.''
    Rule 104(b)(2) currently provides that ``Exchange systems shall
enforce the proper sequencing of incoming orders and algorithmically-
generated messages and will prevent incoming DMM interest from trading
with resting DMM interest. If the incoming DMM interest would trade
with resting DMM interest only, the incoming DMM interest will be
cancelled. If the incoming DMM interest would trade with interest other
than DMM interest, the resting DMM interest will be cancelled.'' Since
the Exchange transitioned to Pillar, the Exchange no longer enforces
self-trade prevention on behalf of DMMs. Instead, DMMs may use one of
the Self-Trade Prevention Modifiers (``STP'') described in Rule
7.31(i)(2).
    Rule 104(b)(6) currently provides that ``DMM Units may not enter
the following orders and modifiers: Market Orders, Inside Limit Orders,
MOO Orders, CO Orders, MOC Orders, LOC Orders, or Last Sale Peg
Orders.'' In the Pillar rules, Rule 7.31 sets forth which orders and
modifiers are not available to DMMs, and therefore Rule 104(b)(6) is
obsolete. All of the orders and modifiers set forth in Rule 104(b)(6)
that are unavailable to DMMs are reflected in Rule 7.31 except for
Inside Limit Orders, which limitation was only added to Rule
104(b)(6).\26\ The Exchange accordingly proposes to amend Rule
7.31(a)(3) to reflect that Inside Limit Orders are not available to
DMMs. The Exchange believes that the proposed new text for Rule
104(b)(2) would provide transparency that Rule 7.31 would describe
which orders and modifiers would be available to DMMs, including STP
modifiers.
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    \26\ See Securities Exchange Act Release No. 94030 (January 24,
2022), 87 FR 4695, 4696 (January 28, 2022) (SR-NYSE-2022-05) (Notice
of Filing and Immediate Effectiveness of Proposed Rule Change To
Modify Rule 7.31 To Provide for Inside Limit Orders and Make Other
Conforming Changes).
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     The Exchange proposes to amend Rule 104(b)(3) to delete
references to ``Floor broker agency interest files or reserve
interest'' as such references are now obsolete. The Exchange no longer
uses ``Floor broker agency interest files'' and no longer provides
Floor brokers with reserve interest functionality that differs from the
Reserve Orders available to all member organizations, as described in
Rule 7.31.
     The Exchange proposes to amend Rule 104(b) by deleting
subparagraph (4), which provides that ``[t]he DMM unit's algorithm may
place within Exchange systems trading interest to be known as a
``Capital Commitment Schedule''. (See Rule 1000 concerning the
operation of the Capital Commitment Schedule).'' With the transition to
Pillar, the Exchange has replaced the ``Capital Commitment Schedule''
with Capital Commitment Orders, as described in Rule 7.31(d)(5), and
has deleted Rule 1000. Accordingly, this current rule is obsolete. The
Exchange proposes a non-substantive amendment to renumber Rule
104(b)(5) as Rule 104(b)(4).
     The Exchange proposes to delete the text accompanying
current Rules 104(c), (d), and (e) as obsolete now that the Exchange
trades on Pillar. Rule 104(c) currently provides: ``A DMM unit may
maintain reserve interest consistent with Exchange rules governing
Reserve Orders. Such reserve interest is eligible for execution in
manual transactions.'' Rule 7.31 now describes how Reserve Orders
function.
    Rule 104(d) currently provides: ``A DMM unit may provide
algorithmically-generated price improvement to all or part of an
incoming order that can be executed at or within the Exchange BBO
through the use of Capital Commitment Schedule interest (see Rule
1000). Any orders eligible for execution in Exchange systems at the
price of the DMM unit's interest will trade on parity with such
interest, as will any displayed interest representing a d-Quote
enabling such interest to trade at the same price as the DMM unit's
interest.'' As noted above, with Pillar, the Exchange has deleted Rule
1000 and no longer offers the Capital Commitment Schedule to DMMs.
    Rule 104(e) currently provides: ``DMM units shall provide contra
side liquidity as needed for the execution of odd-lot quantities that
are eligible to be executed as part of the opening, re-opening and
closing transactions but remain unpaired after the DMM has paired all
other eligible round lot sized interest.'' This requirement is
obsolete.
    With these proposed deletions, the Exchange proposes non-
substantive amendments to renumber Rules 104(f), (g), (h), (i), and (j)
as Rules 104(c), (d), (e), (f), and (g) and update cross-references in
proposed Rule 104(e)(iii) from subparagraph (h)(ii) and (iii) to
(e)(ii) and (iii).
     The Exchange proposes to amend current Rule 104(h)(ii)
(proposed Rule 104(e)(ii)) to delete reference to information that is
no longer available to a DMM at the post. Specifically, the

Exchange no longer provides DMMs at the post with the following
information: ``the price and size of any individual order or Floor
broker agency interest file and the entering and clearing firm
information for such order, except that the display shall exclude any
order or portion thereof that a market participant has elected not to
display to a DMM.'' Accordingly, the Exchange proposes to amend Rule
104(e)(ii) to delete that rule text.
* * * * *
    The Exchange proposes that the non-substantive amendments to Rule
104 would be operative immediately upon approval of this proposed rule
change. Because of the technology changes associated with the proposed
changes to Rule 7.35B, the Exchange proposes that, subject to approval
of the proposed rule change, the Exchange will announce the
implementation date of the remaining proposed rule changes by Trader
Update. Subject to approval of this proposed rule change, the Exchange
anticipates that such changes will be implemented in the fourth quarter
of 2022.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with Section
6(b) of the Act,\27\ in general, and furthers the objectives of
Sections 6(b)(5) of the Act,\28\ in particular, because it is designed
to prevent fraudulent and manipulative acts and practices, to promote
just and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to, and perfect the mechanisms of,
a free and open market and a national market system and, in general, to
protect investors and the public interest and because it is not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
---------------------------------------------------------------------------

    \27\ 15 U.S.C. 78f(b).
    \28\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    Proposed Changes to Closing Auction Price. The Exchange believes
that the proposed amendment to Rule 7.35B(g) regarding how the Closing
Auction Price would be determined would remove impediments to and
perfect the mechanism of a free and open market and a national market
system because it would promote a more transparent and deterministic
Closing Auction process and support the maintenance of a fair and
orderly market. Specifically, the proposed change would require that
the DMM determine a Closing Auction Price that is at or between the
last-published Imbalance Reference Price and Continuous Book Clearing
Price.\29\ Accordingly, the Closing Auction Price must be within a pre-
determined range of prices that would have been disseminated via the
Closing Auction Imbalance Information and that cannot be changed by the
DMM after the end of Core Trading Hours. The Exchange further believes
that this proposed parameter is consistent with how Closing Auction
Prices have been determined for the vast majority of Closing Auctions.
For example, as noted above, in the period January 1, 2021 to December
31, 2021, 95.8% of all Closing Auctions were priced at or between the
last-published Imbalance Reference Price and Continuous Book Clearing
Price. Similarly, during this same period, 94.6% of closing auction
volume priced within these parameters. Moreover, 74% of the 4.2% of
Closing Auctions that did not price within those parameters closed at
prices only one or two cents away from those boundaries.\30\ More
recent Closing Auction data also shows that Closing Auctions executing
within the proposed range resulted in more representative prices for
market participants.\31\
---------------------------------------------------------------------------

    \29\ The DMM's determination of the precise Closing Auction
Price within the proposed range would remain subject to the DMM's
obligation to maintain a fair and orderly market as specified in
Rule 104.
    \30\ More specifically, as noted, 55.9% were one cent away and
14.2% were two cents away.
    \31\ See note 21, supra.
---------------------------------------------------------------------------

    Proposed Changes to How DMMs Would Participate in the Closing
Auction. The Exchange believes that the proposed amendments to Rule
7.35B(a)(2) relating to how DMMs would participate in the Closing
Auction would remove impediments to and perfect the mechanism of a free
and open market and a national market system because with these
changes, the price range at which a security could close would be based
on non-DMM interest eligible to participate in the Closing Auction. The
proposed change would continue to provide DMMs with tools to comply
with their Rule 104(a)(3) obligation to supply liquidity as needed to
facilitate a fair and orderly Closing Auction. Specifically, in order
to supply liquidity as needed to facilitate the Closing Auction, DMMs
could enter DMM Auction Liquidity after the end of Core Trading Hours
either in response to the electronic message sent by the Exchange to
close a security or manually. In addition, by cancelling resting DMM
Orders, only non-DMM interest eligible to participate in the Closing
Auction would be considered in the calculation of the Continuous Book
Clearing Price. The Exchange believes that these changes, together with
the proposed pricing parameters for determining the Closing Auction
Price, would eliminate the potential for a Closing Auction to be priced
outside of the last-published imbalance information, and therefore
promote transparency and determinism in the Closing Auction process and
support the maintenance of a fair and orderly market.
    Proposed Non-Substantive Amendments. The Exchange believes that the
proposed non-substantive amendments to Rules 7.31, 7.35, 7.35B and 104
would remove impediments to and perfect the mechanism of a free and
open market and a national market system because the proposed changes
are designed to eliminate obsolete rule text, update rule references to
reflect Pillar functionality, and make other conforming changes.
Specifically, the Exchange proposes to eliminate references to pre-
Pillar Rules and trading functionality, including references to Rules
123D, 123C, Rule 1000, the Capital Commitment Schedule, Floor broker
agency interest files, odd-lot orders in the close, and self-trade
prevention. The Exchange also proposes to update Rule 104(b) to cross
reference Rule 7.31 to determine which orders and modifiers are
available to DMMs, rather than separately (and duplicatively) including
this description in Rule 104. The Exchange also proposes to update
current Rule 104(h)(ii) (proposed Rule 104(e)(ii)) to delete reference
to information that is no longer available to DMMs at the post. The
Exchange believes that these proposed amendments will promote
transparency and clarity in Exchange rules regarding how DMMs function
on the Exchange, including what information is available to them at the
post. The Exchange also proposes to modify Rule 7.35(a)(4)(C), which
provides that the Continuous Book Clearing Price will be the Imbalance
Reference Price if there is no Imbalance of all orders eligible to
trade in the Auction, to clarify that the Imbalance Reference Price
would be rounded to the MPV for the specific security if it is in an
increment smaller than the MPV for such security. The Exchange believes
this proposed change would add clarity to Exchange rules regarding the
determination of the Continuous Book Clearing Price, in connection with
the proposed changes to Rule 7.35B(g) regarding how the Closing Auction
Price would be determined.
    Finally, the Exchange believes that the proposed non-substantive

amendments to Rules 7.35B(c)(1)(D), 7.35B(j)(2) and 7.35B(j)(2)(A)(iii)
to eliminate references to Floor broker interest and oral interest
entered by Floor brokers at the close would remove impediments to and
perfect the mechanism of a free and open market and a national market
system because these proposed changes are designed to conform Exchange
rules to the changes described in the Floor Broker Interest Approval
Order.

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

    In accordance with Section 6(b)(8) of the Act,\32\ the Exchange
believes that the proposed rule change would not impose any burden on
competition that is not necessary or appropriate in furtherance of the
purposes of the Act. The proposed change is designed to revise the
Closing Auction process on the Exchange to make it more transparent and
deterministic, while still retaining the DMM market model. The Exchange
believes that the proposed rule change would promote intermarket
competition, particularly for issuers in connection with their
determination of which exchange to select as a primary listing
exchange. The Exchange does not believe that the proposed rule change
would impose any burden on intra-market competition that is not
necessary or appropriate in furtherance of the purposes of the Act
because they are designed to address the DMM's unique role at the
Exchange, including the DMM's Rule 104(a)(3) obligation to facilitate
the Closing Auction by supplying liquidity as needed for a fair and
orderly Closing Auction. The proposed changes are designed to make the
process more transparent and deterministic.
---------------------------------------------------------------------------

    \32\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

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

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

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

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

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-NYSE-2022-32 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-NYSE-2022-32. 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 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-NYSE-2022-32 and should
be submitted on or before August 18, 2022.
---------------------------------------------------------------------------

    \33\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\33\
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022-16149 Filed 7-27-22; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: October 29, 2008 (Volume 73, Number 210)]
[Notices]
[Page 64318]
[DOCID:fr29oc08-54]

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ENVIRONMENTAL PROTECTION AGENCY

[FRL-8736-3; Docket ID No. EPA-HQ-ORD-2008-00461]

Draft Toxicological Review of Tetrachloroethylene
(Perchloroethylene): In Support of the Summary Information in the
Integrated Risk Information System (IRIS); Correction

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of Peer-Review Meeting; correction.

-----------------------------------------------------------------------

SUMMARY: EPA announced on October 16, 2008 (73 FR 61416), that the
National Academy of Sciences (NAS) will convene an independent panel of
experts and organize and conduct a review of the draft document titled,
``Toxicological Review of Tetrachloroethylene (Perchloroethylene): In
Support of Summary Information on the Integrated Risk Information
System (IRIS)'' (EPA/635/R-08/011A). The document contained an
incorrect meeting location.

Correction

    In the Federal Register of October 16, 2008, in FR Doc. E8-24595,
on page 61417, in the first column, correct the ADDRESSES section to
read:
    The peer-review panel meeting will be held at The National Academy
of Sciences, 2100 C Street, NW., Room 150, Washington, DC 20418. For
details about registering for and attending the meeting, please see the
NAS's Web site at http://www8.nationalacademies.org/cp/
projectview.aspx?key=48697.

FOR FURTHER INFORMATION CONTACT: Questions regarding information,
registration, access or services for individuals with disabilities, or
logistics for the external peer-review panel meeting should be directed
to NAS. For further information, please see the NAS's Web site http://
www8.nationalacademies.org/cp/projectview.aspx?key=48697. For technical
information about the document, please contact the Information
Management Team, National Center for Environmental Assessment, U.S.
EPA; telephone:<PHONE_NUMBER>; facsimile:<PHONE_NUMBER>; e-mail
<EMAIL_ADDRESS>
    Dated: October 23, 2008.
Rebecca Clark,
Acting Director, National Center for Environmental Assessment.
[FR Doc. E8-25805 Filed 10-28-08; 8:45 am]

BILLING CODE 6560-50-P


[Federal Register Volume 86, Number 183 (Friday, September 24, 2021)]
[Notices]
[Page 53100]
[FR Doc No: 2021-20671]

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Internal Agency Docket No. FEMA-4489-DR; Docket ID FEMA-2021-0001]

Illinois; Amendment No. 5 to Notice of a Major Disaster
Declaration

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: This notice amends the notice of a major disaster declaration
for the State of Illinois (FEMA-4489-DR), dated March 26, 2020, and
related determinations.

DATES: This amendment was issued August 5, 2021.

FOR FURTHER INFORMATION CONTACT: Dean Webster, Office of Response and
Recovery, Federal Emergency Management Agency, 500 C Street SW,
Washington, DC 20472,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: The notice of a major disaster declaration
dated March 26, 2020 for the State of Illinois is hereby amended to
include the Hazard Mitigation Grant Program.

    All areas within the State of Illinois are eligible for
assistance under the Hazard Mitigation Grant Program.

    The following Catalog of Federal Domestic Assistance Numbers
(CFDA) are to be used for reporting and drawing funds: 97.030,
Community Disaster Loans; 97.031, Cora Brown Fund; 97.032, Crisis
Counseling; 97.033, Disaster Legal Services; 97.034, Disaster
Unemployment Assistance (DUA); 97.046, Fire Management Assistance
Grant; 97.048, Disaster Housing Assistance to Individuals and
Households In Presidentially Declared Disaster Areas; 97.049,
Presidentially Declared Disaster Assistance--Disaster Housing
Operations for Individuals and Households; 97.050, Presidentially
Declared Disaster Assistance to Individuals and Households--Other
Needs; 97.036, Disaster Grants--Public Assistance (Presidentially
Declared Disasters); 97.039, Hazard Mitigation Grant.

Deanne Criswell,
Administrator, Federal Emergency Management Agency.
[FR Doc. 2021-20671 Filed 9-23-21; 8:45 am]
BILLING CODE 9111-23-P


[Federal Register: July 18, 2007 (Volume 72, Number 137)]
[Notices]
[Page 39471-39472]
[DOCID:fr18jy07-120]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56056; File No. SR-BSE-2007-19]

Self-Regulatory Organizations; Boston Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
To Amend the Rules of the Boston Options Exchange Related to Obvious
Errors

July 12, 2007.
    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 June 28, 2007, the Boston Stock Exchange, Inc. (``BSE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been substantially prepared by the
Exchange. The Exchange filed the proposed rule change as a ``non-
controversial'' proposed rule change pursuant to section 19(b)(3)(A)
\3\ of the and Rule 19b-4(f)(6) thereunder,\4\ which renders the
proposal effective upon filing with the Commission. The Commission is
publishing this notice to solicit comments on the proposed rule change
from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

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

    The Exchange proposes amending the Boston Options Exchange
(``BOX'') Rules related to Obvious Errors to allow the parties to a
transaction to mutually agree to nullify or adjust a trade. Below is
the text of the proposed rule change. Proposed new language is in
italics.
* * * * *

Rules of the Boston Stock Exchange

Rules of the Boston Options Exchange Facility
Chapter V. Doing Business on BOX
Sec. 20 Obvious Errors
    (a) through (f). No change.
    (g) Mutual Agreement. The determination as to whether a trade was
executed in error may be made by mutual agreement of the affected
parties to a particular transaction. A trade may be nullified or
adjusted on the terms that all parties to a particular transaction
agree. In the absence of mutual agreement by the parties, a particular
trade may only be nullified or adjusted when the transaction results in
an Obvious Error as provided for in this Section.
    Supplementary Material: No change.
* * * * *

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. BSE 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 Exchange proposes to amend BOX's Rules to provide parties to a
particular transaction with the ability to nullify or adjust a trade if
such nullification or adjustment is agreed to by all parties to the
transaction at issue. In other words, the determination as to whether a
trade was executed at an erroneous price may be made by mutual
agreement of the affected parties to a particular transaction. A trade
may be nullified or adjusted on the terms that all parties to a
particular transaction agree. In the absence of mutual agreement by the
parties, a particular trade may only be nullified or adjusted when the
transaction results in an Obvious Error as provided for in Chapter V,
Section 20 of BOX's Rules.

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with section 6(b) of the Act,\5\ in general, and furthers the
objectives of section 6(b)(5) of the Act,\6\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, and to protect
investors and the public interest in that it is designed to foster
cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, to remove impediments to and
perfect the mechanism for a free and open market and a national market
system, and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

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

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

    The Exchange has neither solicited nor received written comments on
the proposed rule change.

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

    Because the 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 after the date of filing (or such shorter time as the Commission
may designate if consistent with the protection of investors and the
public interest), the proposed rule change has become effective
pursuant to section 19(b)(3)(A) of the Act \7\ and Rule 19b-4(f)(6)
thereunder.\8\ As required under Rule 19b-4(f)(6)(iii),\9\ the Exchange
provided the Commission with 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
the filing of the proposed rule change.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6).
    \9\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in the furtherance of the purposes of the Act.

IV. Solicitation of Comments

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

Electronic Comments

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

File Number SR-BSE-2007-19 on 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-BSE-2007-19. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments, all

written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for inspection and
copying in the Commission's Public Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-BSE-2007-19 and should be
submitted on or before August 8, 2007.

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\10\
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Nancy M. Morris,
Secretary.
[FR Doc. E7-13881 Filed 7-17-07; 8:45 am]

BILLING CODE 8010-01-P


[Federal Register Volume 77, Number 85 (Wednesday, May 2, 2012)]
[Notices]
[Pages 26018-26019]
[FR Doc No: 2012-10517]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2011-E-0114]

Determination of Regulatory Review Period for Purposes of Patent
Extension; Victoza

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Food and Drug Administration (FDA) has determined the
regulatory review period for Victoza and is publishing this notice of
that determination as required by law. FDA has made the determination
because of the submission of an application to the Director of Patents
and Trademarks, Department of Commerce, for the extension of a patent
which claims that human drug product.

ADDRESSES: Submit electronic comments to http://www.regulations.gov.
Submit written petitions along with three copies and written comments
to the Division of Dockets Management (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Beverly Friedman, Office of Regulatory
Policy, Food and Drug Administration, 10903 New Hampshire Ave., Bldg.
51, rm. 6284, Silver Spring, MD 20993-0002,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: The Drug Price Competition and Patent Term
Restoration Act of 1984 (Pub. L. 98-417) and the Generic Animal Drug
and Patent Term Restoration Act (Pub. L. 100-670) generally provide
that a patent may be extended for a period of up to 5 years so long as
the patented item (human drug product, animal drug product, medical
device, food additive, or color additive) was subject to regulatory
review by FDA before the item was marketed. Under these acts, a
product's regulatory review period forms the basis for determining the
amount of extension an applicant may receive.
    A regulatory review period consists of two periods of time: A
testing phase and an approval phase. For human drug products, the
testing phase begins when the exemption to permit the clinical
investigations of the drug becomes effective and runs until the
approval phase begins. The approval phase starts with the initial
submission of an application to market the human drug product and
continues until FDA grants permission to market the drug product.
Although only a portion of a regulatory review period may count toward
the actual amount of extension that the Director of Patents and
Trademarks may award (for example, half the testing phase must be
subtracted as well as any time that may have occurred before the patent
was issued), FDA's determination of the length of a regulatory review
period for a human drug product will include all of the testing phase
and approval phase as specified in 35 U.S.C. 156(g)(1)(B).
    FDA recently approved for marketing the human drug product VICTOZA
(liraglutide (rDNA origin)). VICTOZA is indicated as an adjunct to diet
and exercise to improve glycemic control in adults with type 2 diabetes
mellitus. Subsequent to this approval, the Patent and Trademark Office
received a patent term restoration application for Victoza (U.S. Patent
No. 6,268,343) from Novo Nordisk A/S, and the Patent and Trademark
Office requested FDA's assistance in determining this patent's
eligibility for patent term restoration. In a letter dated April 25,
2011, FDA advised the Patent and Trademark Office that this human drug
product had undergone a regulatory review period and that the approval
of Victoza represented the first permitted commercial marketing or use
of the product. Thereafter, the Patent and Trademark Office requested
that FDA determine the product's regulatory review period.
    FDA has determined that the applicable regulatory review period for
Victoza is 3,370 days. Of this time, 2,757 days occurred during the
testing phase of the regulatory review period,

while 613 days occurred during the approval phase. These periods of
time were derived from the following dates:
    1. The date an exemption under section 505(i) of the Federal Food,
Drug, and Cosmetic Act (the FD&C Act) (21 U.S.C. 355(i)) became
effective: November 5, 2000. The applicant claims October 5, 2000, as
the date the investigational new drug application (IND) became
effective. However, FDA records indicate that the IND effective date
was November 5, 2000, which was 30 days after FDA receipt of the IND.
    2. The date the application was initially submitted with respect to
the human drug product under section 505(b) of the FD&C Act: May 23,
2008. FDA has verified the applicant's claim that the new drug
application (NDA) for Victoza (NDA 22-341) was initially submitted on
May 23, 2008.
    3. The date the application was approved: January 25, 2010. FDA has
verified the applicant's claim that NDA 22-341 was approved on January
25, 2010.
    This determination of the regulatory review period establishes the
maximum potential length of a patent extension. However, the U.S.
Patent and Trademark Office applies several statutory limitations in
its calculations of the actual period for patent extension. In its
application for patent extension, this applicant seeks 1,826 days of
patent term extension.
    Anyone with knowledge that any of the dates as published are
incorrect may submit to the Division of Dockets Management (see
ADDRESSES) either electronic or written comments and ask for a
redetermination by July 2, 2012. Furthermore, any interested person may
petition FDA for a determination regarding whether the applicant for
extension acted with due diligence during the regulatory review period
by October 24, 2012. To meet its burden, the petition must contain
sufficient facts to merit an FDA investigation. (See H. Rept. 857, part
1, 98th Cong., 2d sess., pp. 41-42, 1984.) Petitions should be in the
format specified in 21 CFR 10.30.
    Interested persons may submit to the Division of Dockets Management
(see ADDRESSES) electronic or written comments and written petitions.
It is only necessary to send one set of comments. However, if you
submit a written petition, you must submit three copies of the
petition. Identify comments with the docket number found in brackets in
the heading of this document.
    Comments and petitions that have not been made publicly available
on http://www.regulations.gov may be viewed in the Division of Dockets
Management between 9 a.m. and 4 p.m., Monday through Friday.

    Dated: April 16, 2012.
Jane A. Axelrad,
Associate Director for Policy, Center for Drug Evaluation and Research.
[FR Doc. 2012-10517 Filed 5-1-12; 8:45 am]
BILLING CODE 4160-01-P