[Federal Register Volume 80, Number 149 (Tuesday, August 4, 2015)]
[Notices]
[Pages 46270-46271]
[FR Doc No: 2015-19058]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. IC15-8-000]

Commission Information Collection Activities (FERC-576); Comment
Request

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Comment request.

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SUMMARY: In compliance with the requirements of the Paperwork Reduction
Act of 1995, 44 U.S.C. 3507(a)(1)(D), the Federal Energy Regulatory
Commission (Commission or FERC) is submitting its information
collection [FERC-576, Report of Service Interruptions] to the Office of
Management and Budget (OMB) for review of the information collection
requirements. Any interested person may file comments directly with OMB
and should address a copy of those comments to the Commission as
explained below. The Commission previously issued a Notice in the
Federal Register (80 FR 28991, 5/20/2015) requesting public comments.
The Commission received no comments on the FERC-576 and is making this
notation in its submittal to OMB.

DATES: Comments on the collection of information are due by September
3, 2015.

ADDRESSES: Comments filed with OMB, identified by the OMB Control No.
1902-0004, should be sent via email to the Office of Information and
Regulatory Affairs<EMAIL_ADDRESS>Attention: Federal Energy
Regulatory Commission Desk Officer. The Desk Officer may also be
reached via telephone at<PHONE_NUMBER>.
    A copy of the comments should also be sent to the Commission, in
Docket No. IC15-8-000, by either of the following methods:
     eFiling at Commission's Web site: http://www.ferc.gov/docs-filing/efiling.asp.
     Mail/Hand Delivery/Courier: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE.,
Washington, DC 20426.
    Instructions: All submissions must be formatted and filed in
accordance with submission guidelines at: http://www.ferc.gov/help/submission-guide.asp. For user assistance contact FERC Online Support
by email at<EMAIL_ADDRESS>or by phone at:<PHONE_NUMBER>
(toll-free), or<PHONE_NUMBER> for TTY.
    Docket: Users interested in receiving automatic notification of
activity in this docket or in viewing/downloading comments and
issuances in this docket may do so at http://www.ferc.gov/docs-filing/docs-filing.asp.

FOR FURTHER INFORMATION CONTACT: Ellen Brown may be reached by email at
<EMAIL_ADDRESS>by telephone at<PHONE_NUMBER>, and by fax at
(202) 273-0873.

SUPPLEMENTARY INFORMATION:
    Title: FERC-576, Report of Service Interruptions.
    OMB Control No.: 1902-0004.
    Type of Request: Three-year extension of the FERC-576 information
collection requirements with no changes to the reporting requirements.
    Abstract: A natural gas company must obtain Commission
authorization to engage in the transportation, sale, or exchange of
natural gas in interstate commerce under the Natural Gas Act (NGA).\1\
The NGA also empowers the Commission to oversee continuity of service
in the transportation of natural gas in interstate commerce. The
information collected under FERC-576 notifies the Commission of: (1)
Damage to jurisdictional natural gas facilities as a result of a
hurricane, earthquake, or other natural disaster, or terrorist
activity, (2) serious interruptions to service, and (3) damage to
jurisdictional natural gas facilities due to natural disaster or
terrorist activity, that creates

the potential for serious delivery problems on the pipeline's own
system or the pipeline grid.
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    \1\ Public Law 75 688; 15 U.S.C. 717 & 717w.
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    Filings (in accordance with the provisions of section 4(d) of the
NGA) \2\ must contain information necessary to advise the Commission
when a change in service has occurred. Section 7(d) of the NGA \3\
authorizes the Commission to issue a temporary certificate in cases of
emergency to assure maintenance of adequate service or to serve
particular customers, without notice or hearing.
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    \2\ (15 U.S.C. 717c).
    \3\ (15 U.S.C. 717f).
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    Respondents to the FERC-576 are encouraged to submit the reports by
email to<EMAIL_ADDRESS>but also have the option of faxing the
reports to the Director of the Division of Pipeline Certificates. 18
CFR 260.9(b) requires that a report of service interruption or damage
to natural gas facilities state: (1) The location of the service
interruption or damage to natural gas pipeline or storage facilities;
(2) The nature of any damage to pipeline or storage facilities; (3)
Specific identification of the facilities damaged; (4) The time the
service interruption or damage to the facilities occurred; (5) The
customers affected by the service interruption or damage to the
facilities; (6) Emergency actions taken to maintain service; and (7)
Company contact and telephone number. The Commission may contact
pipelines reporting damage or other pipelines to determine availability
of supply, and if necessary, authorize transportation or construction
of facilities to alleviate constraints in response to these reports.
    A report required by 18 CFR 260.9(a)(1)(i) of damage to natural gas
facilities resulting in loss of pipeline throughput or storage
deliverability shall be reported to the Director of the Commission's
Division of Pipeline Certificates at the earliest feasible time when
pipeline throughput or storage deliverability has been restored.
    In any instance in which an incident or damage report involving
jurisdictional natural gas facilities is required by Department of
Transportation (DOT) reporting requirements under the Natural Gas
Pipeline Safety Act of 1968, a copy of such report shall be submitted
to the Director of the Commission's Division of Pipeline Certificates,
within 30 days of the reportable incident.\4\
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    \4\ 18 CFR 260.9(d).
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    If the Commission failed to collect these data, it would lose the
ability to monitor and evaluate transactions, operations, and
reliability of interstate pipelines and perform its regulatory
functions. These reports are kept by the Commission Staff as non-public
information and are not made part of the public record.
    Type of Respondents: Natural gas companies.
    Estimate of Annual Burden \5\: The Commission estimates the annual
public reporting burden for the information collection as:
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    \5\ The Commission defines burden as the total time, effort, or
financial resources expended by persons to generate, maintain,
retain, or disclose or provide information to or for a Federal
agency. For further explanation of what is included in the
information collection burden, reference 5 Code of Federal
Regulations 1320.3.

                                                        FERC-576--Report of Service Interruptions
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                                                                          Annual  number                                   Total annual
                                                             Number of     of  responses   Total number   Average burden  burden hours &     Cost per
                                                            respondents         per        of responses     & cost per     total  annual  respondent ($)
                                                                            respondent                     response \6\        cost
                                                                     (1)             (2)     (1) * (2) =             (4)     (3) * (4) =       (5) / (1)
                                                                                (3)                             (5)
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Submittal of Original Email/Fax.........................              22               2              44               1              44              72
                                                                                $72          $3,168
Submittal of Damage Report..............................              22               2              44            0.25              11              18
                                                                                $18            $198
Submittal of DOT Incident Report........................              22               1              22            0.25             5.5              18
                                                                                $18             $99
                                                         -----------------------------------------------------------------------------------------------
    Total...............................................  ..............  ..............  ..............  ..............            60.5             108
                                                                                $3,465
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    Comments: Comments are invited on: (1) Whether the collection of
information is necessary for the proper performance of the functions of
the Commission, including whether the information will have practical
utility; (2) the accuracy of the agency's estimate of the burden and
cost of the collection of information, including the validity of the
methodology and assumptions used; (3) ways to enhance the quality,
utility and clarity of the information collection; and (4) ways to
minimize the burden of the collection of information on those who are
to respond, including the use of automated collection techniques or
other forms of information technology.
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    \6\ The estimates for cost per response are derived using the
following formula: Average Burden Hours per Response * $72.00 per
Hour = Average Cost per Response. The hourly cost figure comes from
the FERC average salary ($149,489/year). Commission staff believes
the FERC average salary to be representative wage for industry
respondents.

    Dated: July 29, 2015.
Kimberly D. Bose,
Secretary.
[FR Doc. 2015-19058 Filed 8-3-15; 8:45 am]
BILLING CODE 6717-01-P


engines while MIAX Emerald maintains only 12 matching engines. This
also results in more of the Exchange's hardware and software being
subject to depreciation than MIAX Emerald's hardware and software due
to the greater amount of equipment and software necessary to support
the greater number of matching engines on the Exchange.

Allocated Shared Expenses
    Finally, a limited portion of general shared expenses was allocated
to overall physical connectivity costs because without these general
shared costs the Exchange would not be able to operate in the manner
that it does and provide physical connectivity. The costs included in
general shared expenses include general expenses of the Exchange,
including office space and office expenses (e.g., occupancy and
overhead expenses), utilities, recruiting and training, marketing and
advertising costs, professional fees for legal, tax and accounting
services (including external and internal audit expenses), and
telecommunications costs. Similarly, the cost of paying directors to
serve on the Exchange's Board of Directors is also included in the
Exchange's general shared expense cost driver.\126\ The Exchange notes
that the 49.1% allocation of general shared expenses for physical 10Gb
ULL connectivity is higher than that allocated to general shared
expenses for Limited Service MEI Ports based on its allocation
methodology that weighted costs attributable to each core service based
on an understanding of each area. While physical connectivity has
several areas where certain tangible costs are heavily weighted towards
providing such service (e.g., Data Center, as described above), Limited
Service MEI Ports do not require as many broad or indirect resources as
other core services.
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    \126\ The Exchange notes that MEMX allocated a precise amount of
10% of the overall cost for directors to providing physical
connectivity. The Exchange does not calculate is expenses at that
granular a level. Instead, director costs are included as part of
the overall general allocation.
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* * * * *
Approximate Cost per 10Gb ULL Connection per Month
    After determining the approximate allocated monthly cost related to
10Gb connectivity, the total monthly cost for 10Gb ULL connectivity of
$1,002,880 was divided by the number of physical 10Gb ULL connections
the Exchange maintained at the time that proposed pricing was
determined (93), to arrive at a cost of approximately $10,784 per
month, per physical 10Gb ULL connection. Due to the nature of this
particular cost, this allocation methodology results in an allocation
among the Exchange and its affiliated markets based on set quantifiable
criteria, i.e., actual number of 10Gb ULL connections.
* * * * *
Costs Related to Offering Limited Service MEI Ports
    The following chart details the individual line-item costs
considered by the Exchange to be related to offering Limited Service
MEI Ports as well as the percentage of the Exchange's overall costs
such costs represent for such area (e.g., as set forth below, the
Exchange allocated approximately 5.8% of its overall Human Resources
cost to offering Limited Service MEI Ports).
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    \127\ See supra note 122 (describing rounding of Annual Costs).
    \128\ See supra note 123 (describing rounding of Monthly Costs
based on Annual Costs).

------------------------------------------------------------------------
                                    Allocated    Allocated
           Cost drivers            annual cost    monthly      % Of all
                                      \127\      cost \128\
------------------------------------------------------------------------
Human Resources..................     $898,480      $74,873          5.8
Connectivity (external fees,             4,435          370          3.8
 cabling, switches, etc.)........
Internet Services and External          41,601        3,467          7.2
 Market Data.....................
Data Center......................       85,214        7,101          7.2
Hardware and Software Maintenance      104,859        8,738          7.2
 and Licenses....................
Depreciation.....................      237,335       19,778          6.3
Allocated Shared Expenses........      785,254       65,438          9.8
                                  --------------------------------------
    Total........................    2,157,178      179,765          7.1
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    Below are additional details regarding each of the line-item costs
considered by the Exchange to be related to offering Limited Service
MEI Ports. While some costs were attempted to be allocated as equally
as possible among the Exchange and its affiliated markets, the Exchange
notes that some of its cost allocation percentages for certain cost
drivers differ when compared to the same cost drivers for the
Exchange's affiliated markets in their similar proposed fee changes for
connectivity and ports. This is because the Exchange's cost allocation
methodology utilizes the actual projected costs of the Exchange (which
are specific to the Exchange, and are independent of the costs
projected and utilized by the Exchange's affiliated markets) to
determine its actual costs, which may vary across the Exchange and its
affiliated markets based on factors that are unique to each
marketplace. The Exchange provides additional explanation below
(including the reason for the deviation) for the significant
differences.
Human Resources
    With respect to Limited Service MEI Ports, the Exchange calculated
Human Resources cost by taking an allocation of employee time for
employees whose functions include providing Limited Service MEI Ports
and maintaining performance thereof (including a broader range of
employees such as technical operations personnel, market operations
personnel, and software engineering personnel) as well as a limited
subset of personnel with ancillary functions related to maintaining
such connectivity (such as sales, membership, and finance personnel).
Just as described above for 10Gb ULL connectivity, the estimates of
Human Resources cost were again determined by consulting with
department leaders, determining which employees are involved in tasks
related to providing Limited Service MEI Ports and maintaining
performance thereof, and confirming that the proposed allocations were
reasonable based on an understanding of the percentage of their time
such employees devote to tasks related to providing Limited Service MEI
Ports and maintaining performance thereof. The Exchange notes that
senior level executives were allocated Human Resources costs to the
extent they are involved in overseeing tasks specifically related to
providing Limited Service MEI Ports.\129\ This includes personnel from
the following Exchange departments that are predominately involved in
providing Limited Service

MEI Ports: Business Systems Development, Trading Systems Development,
Systems Operations and Network Monitoring, Network and Data Center
Operations, Listings, Trading Operations, and Project Management.
Senior level executives were only allocated Human Resources costs to
the extent that they are involved in managing personnel responsible for
tasks integral to providing and maintaining Limited Service MEI Ports.
The Human Resources cost was again calculated using a blended rate of
compensation reflecting salary, equity and bonus compensation,
benefits, payroll taxes, and 401(k) matching contributions.
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    \129\ The Exchange notes that while 3.0 FTEs were allocated in
this filing to the Exchange and a similar number of FTEs in a
similar filing by the Exchange's affiliate, MIAX Emerald (2.5 FTEs),
the overall cost percentage allocated for each differs due to the
individual level of compensation for each employee assigned to work
on projects for the exchanges.
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Connectivity (External Fees, Cabling, Switches, etc.)
    The Connectivity cost includes external fees paid to connect to
other exchanges and cabling and switches, as described above.
Internet Services and External Market Data
    The next cost driver consists of internet services and external
market data. Internet services includes third-party service providers
that provide the internet, fiber and bandwidth connections between the
Exchange's networks, primary and secondary data centers, and office
locations in Princeton and Miami. For purposes of Limited Service MEI
Ports, the Exchange also includes a portion of its costs related to
external market data. External market data includes fees paid to third
parties, including other exchanges, to receive and consume market data
from other markets. The Exchange includes external market data costs
towards the provision of Limited Service MEI Ports because such market
data is necessary (in addition to physical connectivity) to offer
certain services related to such ports, such as validating orders on
entry against the NBBO and checking for other conditions (e.g., halted
securities).\130\ Thus, since market data from other exchanges is
consumed at the Exchange's Limited Service MEI Port level in order to
validate orders, before additional processing occurs with respect to
such orders, the Exchange believes it is reasonable to allocate a small
amount of such costs to Limited Service MEI Ports.
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    \130\ The Exchange notes that MEMX separately allocated 7.5% of
its external market data costs to providing physical connectivity.
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    The Exchange notes that the allocation for the internet Services
and External Market Data cost driver is greater than that of its
affiliate, MIAX Pearl Options, as MIAX allocated 7.2% of its internet
Services and External Market Data expense towards Limited Service MEI
Ports, while MIAX Pearl Options allocated 1.4% to its Full Service MEO
Ports for the same cost driver. The allocation percentages set forth
above differ because they directly correspond with the number of
applicable ports utilized on each exchange. For March 2023, MIAX Market
Makers utilized 1,782 Limited Service MEI ports and MIAX Emerald Market
Makers utilized 1,028 Limited Service MEI ports. When compared to Full
Service Port (Bulk and Single) usage, for March 2023, MIAX Pearl
Options Members utilized only 432 Full Service MEO Ports (Bulk and
Single), far fewer than number of Limited Service MEI Ports utilized by
Market Makers on MIAX and MIAX Emerald, thus resulting in a smaller
cost allocation. There is increased cost associated with supporting a
higher number of ports (requiring more hardware and other technical
infrastructure and internet Service), thus the Exchange allocates a
higher percentage of expense than MIAX Pearl Options, which has a lower
port count.
Data Center
    Data Center costs includes an allocation of the costs the Exchange
incurs to provide Limited Service MEI Ports in the third-party data
centers where it maintains its equipment as well as related costs for
market data to then enter the Exchange's system via Limited Service MEI
Ports (the Exchange does not own the Primary Data Center or the
Secondary Data Center, but instead, leases space in data centers
operated by third parties).
Hardware and Software Maintenance and Licenses
    Hardware and Software Licenses includes hardware and software
licenses used to monitor the health of the order entry services
provided by the Exchange, as described above.
    The Exchange notes that this allocation is greater than its
affiliate, MIAX Pearl Options, as MIAX allocated 7.2% of its Hardware
and Software Maintenance and License expense towards Limited Service
MEI Ports, while MIAX Pearl Options allocated 1.4% to its Full Service
MEO Ports (Bulk and Single) for the same category of expense. The
allocation percentages set forth above differ because they correspond
with the number of applicable ports utilized on each exchange. For
March 2023, MIAX Market Makers utilized 1,782 Limited Service MEI ports
and MIAX Emerald Market Makers utilized 1,028 Limited Service MEI
Ports. When compared to Full Service Port (Bulk and Single) usage, for
March 2023, MIAX Pearl Options Members utilized only 432 Full Service
MEO Ports (Bulk and Single), far fewer than number of Limited Service
MEI Ports utilized by Market Makers on MIAX and MIAX Emerald, thus
resulting in a smaller cost allocation. There is increased cost
associated with supporting a higher number of ports (requiring more
hardware and other technical infrastructure), thus the Exchange
allocates a higher percentage of expense than MIAX Pearl Options, which
has a lower port count.
Depreciation
    The vast majority of the software the Exchange uses to provide
Limited Service MEI Ports has been developed in-house and the cost of
such development, which takes place over an extended period of time and
includes not just development work, but also quality assurance and
testing to ensure the software works as intended, is depreciated over
time once the software is activated in the production environment.
Hardware used to provide Limited Service MEI Ports includes equipment
used for testing and monitoring of order entry infrastructure and other
physical equipment the Exchange purchased and is also depreciated over
time. All hardware and software, were valued at cost, depreciated or
leased over periods ranging from three to five years. Thus, the
depreciation cost primarily relates to servers necessary to operate the
Exchange, some of which is owned by the Exchange and some of which is
leased by the Exchange in order to allow efficient periodic technology
refreshes. The Exchange allocated 6.3% of all depreciation costs to
providing Limited Service MEI Ports. The Exchange allocated
depreciation costs for depreciated software necessary to operate the
Exchange because such software is related to the provision of Limited
Service MEI Ports. As with the other allocated costs in the Exchange's
updated Cost Analysis, the Depreciation cost driver was therefore
narrowly tailored to depreciation related to Limited Service MEI Ports.
    The Exchange notes that this allocation differs from its affiliated
markets due to a number of factors, such as the age of physical assets
and software (e.g., older physical assets and software were previously
depreciated and removed from the allocation), or certain system
enhancements that required new physical assets and software, thus
providing a higher

contribution to the depreciated cost. For example, the Exchange notes
that the percentages it and its affiliate, MIAX Emerald, allocated to
the depreciation cost driver for Limited Service MEI Ports differ by
only 2.6%. However, the Exchange's approximate dollar amount is greater
than that of MIAX Emerald by approximately $10,000 per month. This is
due to two primary factors. First, the Exchange has under gone a
technology refresh since the time MIAX Emerald launched in February
2019, leading to it having more hardware that software that is subject
to depreciation. Second, the Exchange maintains 24 matching engines
while MIAX Emerald maintains only 12 matching engines. This also
results in more of the Exchange's hardware and software being subject
to depreciation than MIAX Emerald's hardware and software due to the
greater amount of equipment and software necessary to support the
greater number of matching engines on the Exchange.
Allocated Shared Expenses
    Finally, a limited portion of general shared expenses was allocated
to overall Limited Service MEI Ports costs as without these general
shared costs the Exchange would not be able to operate in the manner
that it does and provide Limited Service MEI Ports. The costs included
in general shared expenses include general expenses of the Exchange,
including office space and office expenses (e.g., occupancy and
overhead expenses), utilities, recruiting and training, marketing and
advertising costs, professional fees for legal, tax and accounting
services (including external and internal audit expenses), and
telecommunications costs. The Exchange again notes that the cost of
paying directors to serve on its Board of Directors is included in the
calculation of Allocated Shared Expenses, and thus a portion of such
overall cost amounting to less than 10% of the overall cost for
directors was allocated to providing Limited Service MEI Ports. The
Exchange notes that the 9.8% allocation of general shared expenses for
Limited Service MEI Ports is lower than that allocated to general
shared expenses for physical connectivity based on its allocation
methodology that weighted costs attributable to each Core Service based
on an understanding of each area. While Limited Service MEI Ports have
several areas where certain tangible costs are heavily weighted towards
providing such service (e.g., Data Center, as described above), 10Gb
ULL connectivity requires a broader level of support from Exchange
personnel in different areas, which in turn leads to a broader general
level of cost to the Exchange.
    Lastly, the Exchange notes that this allocation is greater than its
affiliate, MIAX Pearl Options, as MIAX allocated 9.8% of its Allocated
Shared Expense towards Limited Service MEI Ports, while MIAX Pearl
Options allocated 3.6% to its Full Service MEO Ports (Bulk and Single)
for the same category of expense. The allocation percentages set forth
above differ because they correspond with the number of applicable
ports utilized on each exchange. For March 2023, MIAX Market Makers
utilized 1,782 Limited Service MEI Ports and MIAX Emerald Market Makers
utilized 1,028 Limited Service MEI ports. When compared to Full Service
Port (Bulk and Single) usage, for March 2023, MIAX Pearl Options
Members utilized only 432 Full Service MEO Ports (Bulk and Single), far
fewer than number of Limited Service MEI Ports utilized by Market
Makers on MIAX, thus resulting in a smaller cost allocation. There is
increased cost associated with supporting a higher number of ports
(requiring more hardware and other technical infrastructure), thus the
Exchange allocates a higher percentage of expense than MIAX Pearl
Options which has a lower port count.\131\
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    \131\ The Exchange allocated a slightly lower amount (9.8%) of
this cost as compared to MIAX Emerald (10.3%). This is not a
significant difference. However, both allocations resulted in an
identical cost amount of $0.8 million, despite the Exchange having a
higher number of Limited Service MEI Ports. MIAX Emerald was
allocated a higher cost per Limited Service MEI Port due to the
additional resources and expenditures associated with maintaining
its recently enhanced low latency network.
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* * * * *
Approximate Cost per Limited Service MEI Port per Month
    The total monthly cost allocated to Limited Service MEI Ports of
$179,765 was divided by the number of chargeable Limited Service MEI
Ports (excluding the two free Limited Service MEI Ports per matching
engine that each Member receives) the Exchange maintained at the time
that proposed pricing was determined (1303), to arrive at a cost of
approximately $138 per month, per charged Limited Service MEI Port.
* * * * *
Cost Analysis--Additional Discussion
    In conducting its Cost Analysis, the Exchange did not allocate any
of its expenses in full to any core services (including physical
connectivity or Limited Service MEI Ports) and did not double-count any
expenses. Instead, as described above, the Exchange allocated
applicable cost drivers across its core services and used the same Cost
Analysis to form the basis of this proposal and the filings the
Exchange submitted proposing fees for proprietary data feeds offered by
the Exchange. For instance, in calculating the Human Resources expenses
to be allocated to physical connections based upon the above described
methodology, the Exchange has a team of employees dedicated to network
infrastructure and with respect to such employees the Exchange
allocated network infrastructure personnel with a high percentage of
the cost of such personnel (42%) given their focus on functions
necessary to provide physical connections. The salaries of those same
personnel were allocated only 8.4% to Limited Service MEI Ports and the
remaining 49.6% was allocated to 1Gb connectivity, other port services,
transaction services, membership services and market data. The Exchange
did not allocate any other Human Resources expense for providing
physical connections to any other employee group, outside of a smaller
allocation of 17.8% for 10Gb ULL connectivity or 18.2% for the entire
network, of the cost associated with certain specified personnel who
work closely with and support network infrastructure personnel. In
contrast, the Exchange allocated much smaller percentages of costs (5%
or less) across a wider range of personnel groups in order to allocate
Human Resources costs to providing Limited Service MEI Ports. This is
because a much wider range of personnel are involved in functions
necessary to offer, monitor and maintain Limited Service MEI Ports but
the tasks necessary to do so are not a primary or full-time function.
    In total, the Exchange allocated 25.6% of its personnel costs to
providing 10Gb ULL and 1Gb ULL connectivity and 5.8% of its personnel
costs to providing Limited Service MEI Ports, for a total allocation of
31.4% Human Resources expense to provide these specific connectivity
and port services. In turn, the Exchange allocated the remaining 68.6%
of its Human Resources expense to membership services, transaction
services, other port services and market data. Thus, again, the
Exchange's allocations of cost across core services were based on real
costs of operating the Exchange and were not double-counted across the
core services or their associated revenue streams.
    As another example, the Exchange allocated depreciation expense to
all core services, including physical connections and Limited Service
MEI

Ports, but in different amounts. The Exchange believes it is reasonable
to allocate the identified portion of such expense because such expense
includes the actual cost of the computer equipment, such as dedicated
servers, computers, laptops, monitors, information security appliances
and storage, and network switching infrastructure equipment, including
switches and taps that were purchased to operate and support the
network. Without this equipment, the Exchange would not be able to
operate the network and provide connectivity services to its Members
and non-Members and their customers. However, the Exchange did not
allocate all of the depreciation and amortization expense toward the
cost of providing connectivity services, but instead allocated
approximately 67.9% of the Exchange's overall depreciation and
amortization expense to connectivity services (61.6% attributed to 10Gb
ULL physical connections and 6.3% to Limited Service MEI Ports). The
Exchange allocated the remaining depreciation and amortization expense
(approximately 32.1%) toward the cost of providing transaction
services, membership services, other port services and market data.
    The Exchange notes that its revenue estimates are based on
projections across all potential revenue streams and will only be
realized to the extent such revenue streams actually produce the
revenue estimated. The Exchange does not yet know whether such
expectations will be realized. For instance, in order to generate the
revenue expected from connectivity, the Exchange will have to be
successful in retaining existing clients that wish to maintain physical
connectivity and/or Limited Service MEI Ports or in obtaining new
clients that will purchase such services. Similarly, the Exchange will
have to be successful in retaining a positive net capture on
transaction fees in order to realize the anticipated revenue from
transaction pricing.
    The Exchange notes that the Cost Analysis is based on the
Exchange's 2023 fiscal year of operations and projections. It is
possible, however, that actual costs may be higher or lower. To the
extent the Exchange sees growth in use of connectivity services it will
receive additional revenue to offset future cost increases. However, if
use of connectivity services is static or decreases, the Exchange might
not realize the revenue that it anticipates or needs in order to cover
applicable costs. Accordingly, the Exchange is committing to conduct a
one-year review after implementation of these fees. The Exchange
expects that it may propose to adjust fees at that time, to increase
fees in the event that revenues fail to cover costs and a reasonable
mark-up of such costs. Similarly, the Exchange may propose to decrease
fees in the event that revenue materially exceeds our current
projections. In addition, the Exchange will periodically conduct a
review to inform its decision making on whether a fee change is
appropriate (e.g., to monitor for costs increasing/decreasing or
subscribers increasing/decreasing, etc. in ways that suggest the then-
current fees are becoming dislocated from the prior cost-based
analysis) and would propose to increase fees in the event that revenues
fail to cover its costs and a reasonable mark-up, or decrease fees in
the event that revenue or the mark-up materially exceeds our current
projections. In the event that the Exchange determines to propose a fee
change, the results of a timely review, including an updated cost
estimate, will be included in the rule filing proposing the fee change.
More generally, the Exchange believes that it is appropriate for an
exchange to refresh and update information about its relevant costs and
revenues in seeking any future changes to fees, and the Exchange
commits to do so.
Projected Revenue \132\
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    \132\ For purposes of calculating revenue for 10Gb ULL
connectivity, the Exchange used revenues for February 2023, the
first full month for which it provided dedicated 10Gb ULL
connectivity to the Exchange and ceased operating a shared 10Gb ULL
network with MIAX Pearl Options.
---------------------------------------------------------------------------

    The proposed fees will allow the Exchange to cover certain costs
incurred by the Exchange associated with providing and maintaining
necessary hardware and other network infrastructure as well as network
monitoring and support services; without such hardware, infrastructure,
monitoring and support the Exchange would be unable to provide the
connectivity and port services. Much of the cost relates to monitoring
and analysis of data and performance of the network via the
subscriber's connection(s). The above cost, namely those associated
with hardware, software, and human capital, enable the Exchange to
measure network performance with nanosecond granularity. These same
costs are also associated with time and money spent seeking to
continuously improve the network performance, improving the
subscriber's experience, based on monitoring and analysis activity. The
Exchange routinely works to improve the performance of the network's
hardware and software. The costs associated with maintaining and
enhancing a state-of-the-art exchange network is a significant expense
for the Exchange, and thus the Exchange believes that it is reasonable
and appropriate to help offset those costs by amending fees for
connectivity services. Subscribers, particularly those of 10Gb ULL
connectivity, expect the Exchange to provide this level of support to
connectivity so they continue to receive the performance they expect.
This differentiates the Exchange from its competitors. As detailed
above, the Exchange has five primary sources of revenue that it can
potentially use to fund its operations: transaction fees, fees for
connectivity services, membership and regulatory fees, and market data
fees. Accordingly, the Exchange must cover its expenses from these five
primary sources of revenue.
    The Exchange's Cost Analysis estimates the annual cost to provide
10Gb ULL connectivity services will equal $12,034,554. Based on current
10Gb ULL connectivity services usage, the Exchange would generate
annual revenue of approximately $15,066,000. The Exchange believes this
represents a modest profit of 20% when compared to the cost of
providing 10Gb ULL connectivity services, which could decrease over
time.\133\
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    \133\ Assuming the U.S. inflation rate continues at its current
rate, the Exchange believes that the projected profit margins in
this proposal will decrease; however, the Exchange cannot predict
with any certainty whether the U.S. inflation rate will continue at
its current rate or its impact on the Exchange's future profits or
losses. See, e.g., https://www.usinflationcalculator.com/inflation/current-inflation-rates/ (last visited June 13, 2023).
---------------------------------------------------------------------------

    The Exchange's Cost Analysis estimates the annual cost to provide
Limited Service MEI Port services will equal $2,157,178. Based on
current Limited Service MEI Port services usage, the Exchange would
generate annual revenue of approximately $3,300,600. The Exchange
believes this would result in an estimated profit margin of 35% after
calculating the cost of providing Limited Service MEI Port services,
which profit margin could decrease over time.\134\ The Exchange notes
that the cost to provide Limited Service MEI Ports is higher than the
cost for the Exchange's affiliate, MIAX Pearl Options, to provide Full
Service MEO Ports due to the substantially higher number of Limited
Service MEI Ports used by Exchange Members. For example, MIAX Market
Makers are currently allocated 1,782 Limited Service MEI Ports compared
to only 432 Full Service MEO Ports (Bulk and

Single combined) allocated to MIAX Pearl Options members.
---------------------------------------------------------------------------

    \134\ Id.
---------------------------------------------------------------------------

    Based on the above discussion, the Exchange believes that even if
the Exchange earns the above revenue or incrementally more or less, the
proposed fees are fair and reasonable because they will not result in
pricing that deviates from that of other exchanges or a supra-
competitive profit, when comparing the total expense of the Exchange
associated with providing 10Gb ULL connectivity and Limited Service MEI
Port services versus the total projected revenue of the Exchange
associated with network 10Gb ULL connectivity and Limited Service MEI
Port services.
    The Exchange also notes that this the resultant profit margin
differs slightly from the profit margins set forth in similar fee
filings by its affiliated markets. This is not atypical among exchanges
and is due to a number of factors that differ between these four
markets, including: different market models, market structures, and
product offerings (equities, options, price-time, pro-rata, simple, and
complex); different pricing models; different number of market
participants and connectivity subscribers; different maintenance and
operations costs, as described in the cost allocation methodology
above; different technical architecture (e.g., the number of matching
engines per exchange, i.e., the Exchange maintains 24 matching engines
while MIAX Emerald maintains only 12 matching engines); and different
maturity phase of the Exchange and its affiliated markets (i.e., start-
up versus growth versus more mature). All of these factors contribute
to a unique and differing level of profit margin per exchange.
    Further, the Exchange proposes to charge rates that are comparable
to, or lower than, similar fees for similar products charged by
competing exchanges. For example, for 10Gb ULL connectivity, the
Exchange proposes a lower fee than the fee charged by Nasdaq for its
comparable 10Gb Ultra fiber connection ($13,500 per month for the
Exchange vs. $15,000 per month for Nasdaq).\135\ NYSE American charges
even higher fees for its comparable 10GB LX LCN connection than the
Exchange's proposed fees ($13,500 for the Exchange vs. $22,000 per
month for NYSE American).\136\ Accordingly, the Exchange believes that
comparable and competitive pricing are key factors in determining
whether a proposed fee meets the requirements of the Act, regardless of
whether that same fee across the Exchange's affiliated markets leads to
slightly different profit margins due to factors outside of the
Exchange's control (i.e., more subscribers to 10Gb ULL connectivity on
the Exchange than its affiliated markets or vice versa).
---------------------------------------------------------------------------

    \135\ See NASDAQ Pricing Schedule, Options 7, Section 3, Ports
and Other Services and NASDAQ Rules, General 8: Connectivity,
Section 1. Co-Location Services.
    \136\ See NYSE American Options Fee Schedule, Section V.A. Port
Fees and Section V.B. Co-Location Fees.
---------------------------------------------------------------------------

* * * * *
    The Exchange has operated at a cumulative net annual loss since it
launched operations in 2012.\137\ This is due to a number of factors,
one of which is choosing to forgo revenue by offering certain products,
such as low latency connectivity, at lower rates than other options
exchanges to attract order flow and encourage market participants to
experience the high determinism, low latency, and resiliency of the
Exchange's trading systems. The Exchange does not believe that it
should now be penalized for seeking to raise its fees as it now needs
to upgrade its technology and absorb increased costs. Therefore, the
Exchange believes the proposed fees are reasonable because they are
based on both relative costs to the Exchange to provide dedicated 10Gb
ULL connectivity and Limited Service MEI Ports, the extent to which the
product drives the Exchange's overall costs and the relative value of
the product, as well as the Exchange's objective to make access to its
Systems broadly available to market participants. The Exchange also
believes the proposed fees are reasonable because they are designed to
generate annual revenue to recoup the Exchange's costs of providing
dedicated 10Gb ULL connectivity and Limited Service MEI Ports.
---------------------------------------------------------------------------

    \137\ The Exchange has incurred a cumulative loss of $121
million since its inception in 2012 through full year 2021. See
Exchange's Form 1/A, Application for Registration or Exemption from
Registration as a National Securities Exchange, filed June 29, 2022,
available at https://www.sec.gov/Archives/edgar/vprr/2200/22001163.pdf.
---------------------------------------------------------------------------

    The Exchange notes that its revenue estimate is based on
projections and will only be realized to the extent customer activity
produces the revenue estimated. As a competitor in the hyper-
competitive exchange environment, and an exchange focused on driving
competition, the Exchange does not yet know whether such projections
will be realized. For instance, in order to generate the revenue
expected from 10Gb ULL connectivity and Limited Service MEI Ports, the
Exchange will have to be successful in retaining existing clients that
wish to utilize 10Gb ULL connectivity and Limited Service MEI Ports
and/or obtaining new clients that will purchase such access. To the
extent the Exchange is successful in encouraging new clients to utilize
10Gb ULL connectivity and Limited Service MEI Ports, the Exchange does
not believe it should be penalized for such success. To the extent the
Exchange has mispriced and experiences a net loss in connectivity
clients or in transaction activity, the Exchange could experience a net
reduction in revenue. While the Exchange is supportive of transparency
around costs and potential margins (applied across all exchanges), as
well as periodic review of revenues and applicable costs (as discussed
below), the Exchange does not believe that these estimates should form
the sole basis of whether or not a proposed fee is reasonable or can be
adopted. Instead, the Exchange believes that the information should be
used solely to confirm that an Exchange is not earning--or seeking to
earn--supra-competitive profits. The Exchange believes the Cost
Analysis and related projections in this filing demonstrate this fact.
    The Exchange is owned by a holding company that is the parent
company of four exchange markets and, therefore, the Exchange and its
affiliated markets must allocate shared costs across all of those
markets accordingly, pursuant to the above-described allocation
methodology. In contrast, the Investors Exchange LLC (``IEX'') and
MEMX, which are currently each operating only one exchange, in their
recent non-transaction fee filings allocate the entire amount of that
same cost to a single exchange. This can result in lower profit margins
for the non-transaction fees proposed by IEX and MEMX because the
single allocated cost does not experience the efficiencies and
synergies that result from sharing costs across multiple platforms. The
Exchange and its affiliated markets often share a single cost, which
results in cost efficiencies that can cause a broader gap between the
allocated cost amount and projected revenue, even though the fee levels
being proposed are lower or competitive with competing markets (as
described above). To the extent that the application of a cost-based
standard results in Commission Staff making determinations as to the
appropriateness of certain profit margins, the Exchange believes that
Commission Staff should also consider whether the proposed fee level is
comparable to, or competitive with, the same fee charged by competing
exchanges and how different cost allocation methodologies (such as
across multiple markets) may result in different profit margins for
comparable fee levels. Further, if Commission Staff

is making determinations as to appropriate profit margins in their
approval of exchange fees, the Exchange believes that the Commission
should be clear to all market participants as to what they have
determined is an appropriate profit margin and should apply such
determinations consistently and, in the case of certain legacy
exchanges, retroactively, if such standards are to avoid having a
discriminatory effect.
    Further, as is reflected in the proposal, the Exchange continuously
and aggressively works to control its costs as a matter of good
business practice. A potential profit margin should not be evaluated
solely on its size; that assessment should also consider cost
management and whether the ultimate fee reflects the value of the
services provided. For example, a profit margin on one exchange should
not be deemed excessive where that exchange has been successful in
controlling its costs, but not excessive on another exchange where that
exchange is charging comparable fees but has a lower profit margin due
to higher costs. Doing so could have the perverse effect of not
incentivizing cost control where higher costs alone could be used to
justify fees increases.
The Proposed Pricing Is Not Unfairly Discriminatory and Provides for
the Equitable Allocation of Fees, Dues, and Other Charges
    The Exchange believes that the proposed fees are reasonable, fair,
equitable, and not unfairly discriminatory because they are designed to
align fees with services provided and will apply equally to all
subscribers.
10Gb ULL Connectivity
    The Exchange believes that the proposed fees are equitably
allocated among users of the network connectivity and port
alternatives, as the users of 10Gb ULL connections consume
substantially more bandwidth and network resources than users of 1Gb
ULL connection. Specifically, the Exchange notes that 10Gb ULL
connection users account for more than 99% of message traffic over the
network, driving other costs that are linked to capacity utilization,
as described above, while the users of the 1Gb ULL connections account
for less than 1% of message traffic over the network. In the Exchange's
experience, users of the 1Gb connections do not have the same business
needs for the high-performance network as 10Gb ULL users.
    The Exchange's high-performance network and supporting
infrastructure (including employee support), provides unparalleled
system throughput with the network ability to support access to several
distinct options markets. To achieve a consistent, premium network
performance, the Exchange must build out and maintain a network that
has the capacity to handle the message rate requirements of its most
heavy network consumers. These billions of messages per day consume the
Exchange's resources and significantly contribute to the overall
network connectivity expense for storage and network transport
capabilities. The Exchange must also purchase additional storage
capacity on an ongoing basis to ensure it has sufficient capacity to
store these messages to satisfy its record keeping requirements under
the Exchange Act.\138\ Thus, as the number of messages an entity
increases, certain other costs incurred by the Exchange that are
correlated to, though not directly affected by, connection costs (e.g.,
storage costs, surveillance costs, service expenses) also increase.
Given this difference in network utilization rate, the Exchange
believes that it is reasonable, equitable, and not unfairly
discriminatory that the 10Gb ULL users pay for the vast majority of the
shared network resources from which all market participants' benefit.
---------------------------------------------------------------------------

    \138\ 17 CFR 240.17a-1 (recordkeeping rule for national
securities exchanges, national securities associations, registered
clearing agencies and the Municipal Securities Rulemaking Board).
---------------------------------------------------------------------------

Limited Service MEI Ports
    The Exchange believes that the proposed fees are equitably
allocated among users of the network connectivity alternatives, as the
users of the Limited Service MEI Ports consume the most bandwidth and
resources of the network. Specifically, as noted above for 10Gb ULL
connectivity, Market Makers who take the maximum amount of Limited
Service MEI Ports account for greater than 99% of message traffic over
the network, while Market Makers with fewer Limited Service MEI Ports
account for less than 1% of message traffic over the network. In the
Exchange's experience, Market Makers who only utilize the two free
Limited Service MEI Ports do not have a business need for the high
performance network solutions required by Market Makers who take the
maximum amount of Limited Service MEI Ports.
    The Exchange's high performance network solutions and supporting
infrastructure (including employee support), provides unparalleled
system throughput and the capacity to handle approximately 18 million
quote messages per second. Based on May 2023 trading results, the
Exchange handles more than 12.3 billion quotes on an average day, and
more than 271 billion quotes over the entire month. Of that total,
Market Makers with the maximum amount of Limited Service MEI Ports
generated more than 156 billion quotes (and more than 7 billion quotes
on an average day), and Market Makers who utilized only the two free
Limited Service MEI Ports generated approximately 78 billion quotes
(and approximately 3.5 billion quotes on an average day). Also for May
2023, Market Makers who utilized 7 to 9 Limited Service MEI ports
submitted an average of 1.3 billion quotes per day and Market Makers
who utilized 5-6 Limited Service MEI Ports submitted an average of 356
million quotes on an average day. In May 2023, the Exchange did not
have any Market Makers that utilized only 3-4 Limited Service MEI
Ports.
    To achieve a consistent, premium network performance, the Exchange
must build out and maintain a network that has the capacity to handle
the message rate requirements of its most heavy network consumers
during anticipated peak market conditions. The need to support billions
of messages per day consume the Exchange's resources and significantly
contribute to the overall network connectivity expense for storage and
network transport capabilities. The Exchange must also purchase
additional storage capacity on an ongoing basis to ensure it has
sufficient capacity to store these messages as part of it surveillance
program and to satisfy its record keeping requirements under the
Exchange Act.\139\ Thus, as the number of connections a Market Maker
has increases, certain other costs incurred by the Exchange that are
correlated to, though not directly affected by, connection costs (e.g.,
storage costs, surveillance costs, service expenses) also increase. The
Exchange sought to design the proposed tiered-pricing structure to set
the amount of the fees to relate to the number of connections a firm
purchases. The more connections purchased by a Market Maker likely
results in greater expenditure of Exchange resources and increased cost
to the Exchange. With this in mind, the Exchange proposes no fee or
lower fees for those Market Makers who receive fewer Limited Service
MEI Ports since those Market Makers generally tend to

send the least amount of orders and messages over those connections.
---------------------------------------------------------------------------

    \139\ 17 CFR 240.17a-1 (recordkeeping rule for national
securities exchanges, national securities associations, registered
clearing agencies and the Municipal Securities Rulemaking Board).
---------------------------------------------------------------------------

    Meanwhile, the Exchange proposes incrementally higher fees for
those that purchase additional Limited Service MEI Ports because those
with the greatest number of Limited Service MEI Ports generate a
disproportionate amount of messages and order traffic, usually billions
per day across the Exchange. The firms that purchase numerous Limited
Service MEI Ports do so for competitive reasons and based on their
business needs, which include a desire to access the market more
quickly using the lowest latency connections. These firms are generally
engaged in sending liquidity removing orders to the Exchange and may
require more connections as they compete to access resting liquidity.
    Consider the following example: a Member has just sent numerous
messages and/or orders over one of their Limited Service MEI Ports that
are now in queue to be processed. That same Member then seeks to enter
an order to remove liquidity from the Exchange's Book. That Member may
choose to send that order over another Limited Service MEI Port it
maintains with less message traffic to help ensure that their liquidity
taking order accesses the Exchange more quickly because that
connection's queue is shorter.
    In addition, Members frequently add and drop connections mid-month
to determine which connections have the least latency (and engage in
the same practice with Limited Service MEI Ports). This results in
increased costs to the Exchange to frequently make changes in the data
center (or its network) and provide the additional technical and
personnel support necessary to satisfy these requests. Given the
difference in network utilization and technical support provided, the
Exchange believes that it is reasonable, equitable, and not unfairly
discriminatory that Market Makers who utilize the most Limited Service
MEI Ports pay for the vast majority of the shared network resources
from which all Member and non-Member users benefit, because the network
is largely designed and maintained to specifically handle the message
rate, capacity and performance requirements of those Market Makers.
    To achieve a consistent, premium network performance, the Exchange
must build out and maintain a network that has the capacity to handle
the message rate requirements of its most heavy network consumers.
Billions of messages per day consume the Exchange's resources and
significantly contribute to the overall network connectivity expense
for storage and network transport capabilities. The Exchange must also
purchase and maintain additional storage capacity on an ongoing basis
to ensure it has sufficient capacity to store these messages as part of
it surveillance program and to satisfy its record keeping requirements
under the Exchange Act.\140\ Thus, as the number of connections a
Market Maker has increases, the related demand on Exchange resources
also increases. The Exchange sought to design the proposed tiered-
pricing structure to set the amount of the fees to relate to the number
of connections a firm purchases. The more connections purchased by a
Market Maker likely results in greater expenditure of Exchange
resources and increased cost to the Exchange.
---------------------------------------------------------------------------

    \140\ 17 CFR 240.17a-1 (recordkeeping rule for national
securities exchanges, national securities associations, registered
clearing agencies and the Municipal Securities Rulemaking Board).
---------------------------------------------------------------------------

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

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
Intra-Market Competition
    The Exchange believes the proposed fees will not result in any
burden on intra-market competition that is not necessary or appropriate
in furtherance of the purposes of the Act because the proposed fees
will allow the Exchange to recoup some of its costs in providing 10Gb
ULL connectivity and Limited Service MEI Ports at below market rates to
market participants since the Exchange launched operations. As
described above, the Exchange has operated at a cumulative net annual
loss since it launched operations in 2012 \141\ due to providing a low-
cost alternative to attract order flow and encourage market
participants to experience the high determinism and resiliency of the
Exchange's trading Systems. To do so, the Exchange chose to waive the
fees for some non-transaction related services and Exchange products or
provide them at a very lower fee, which was not profitable to the
Exchange. This resulted in the Exchange forgoing revenue it could have
generated from assessing any fees or higher fees. The Exchange could
have sought to charge higher fees at the outset, but that could have
served to discourage participation on the Exchange. Instead, the
Exchange chose to provide a low-cost exchange alternative to the
options industry, which resulted in lower initial revenues. Examples of
this are 10Gb ULL connectivity and Limited Service MEI Ports, for which
the Exchange only now seeks to adopt fees at a level similar to or
lower than those of other options exchanges.
---------------------------------------------------------------------------

    \141\ See supra note 137.
---------------------------------------------------------------------------

    Further, the Exchange does not believe that the proposed fee
increase for the 10Gb ULL connection change would place certain market
participants at the Exchange at a relative disadvantage compared to
other market participants or affect the ability of such market
participants to compete. As is the case with the current proposed flat
fee, the proposed fee would apply uniformly to all market participants
regardless of the number of connections they choose to purchase. The
proposed fee does not favor certain categories of market participants
in a manner that would impose an undue burden on competition.
    The Exchange does not believe that the proposed rule change would
place certain market participants at the Exchange at a relative
disadvantage compared to other market participants or affect the
ability of such market participants to compete. In particular, Exchange
personnel has been informally discussing potential fees for
connectivity services with a diverse group of market participants that
are connected to the Exchange (including large and small firms, firms
with large connectivity service footprints and small connectivity
service footprints, as well as extranets and service bureaus) for
several months leading up to that time. The Exchange does not believe
the proposed fees for connectivity services would negatively impact the
ability of Members, non-Members (extranets or service bureaus), third-
parties that purchase the Exchange's connectivity and resell it, and
customers of those resellers to compete with other market participants
or that they are placed at a disadvantage.
    The Exchange does anticipate, however, that some market
participants may reduce or discontinue use of connectivity services
provided directly by the Exchange in response to the proposed fees. In
fact, as mentioned above, one MIAX Pearl Options Market Maker
terminated their MIAX Pearl Options membership on January 1, 2023 as a
direct result of the similar proposed fee changes by MIAX Pearl
Options.\142\

The Exchange does not believe that the proposed fees for connectivity
services place certain market participants at a relative disadvantage
to other market participants because the proposed connectivity pricing
is associated with relative usage of the Exchange by each market
participant and does not impose a barrier to entry to smaller
participants. The Exchange believes its proposed pricing is reasonable
and, when coupled with the availability of third-party providers that
also offer connectivity solutions, that participation on the Exchange
is affordable for all market participants, including smaller trading
firms. As described above, the connectivity services purchased by
market participants typically increase based on their additional
message traffic and/or the complexity of their operations. The market
participants that utilize more connectivity services typically utilize
the most bandwidth, and those are the participants that consume the
most resources from the network. Accordingly, the proposed fees for
connectivity services do not favor certain categories of market
participants in a manner that would impose a burden on competition;
rather, the allocation of the proposed connectivity fees reflects the
network resources consumed by the various size of market participants
and the costs to the Exchange of providing such connectivity services.
---------------------------------------------------------------------------

    \142\ The Exchange acknowledges that IEX included in its
proposal to adopt market data fees after offering market data for
free an analysis of what its projected revenue would be if all of
its existing customers continued to subscribe versus what its
projected revenue would be if a limited number of customers
subscribed due to the new fees. See Securities Exchange Act Release
No. 94630 (April 7, 2022), 87 FR 21945 (April 13, 2022) (SR-IEX-
2022-02). MEMX did not include a similar analysis in either of its
recent non-transaction fee proposals. See supra note 77. The
Exchange does not believe a similar analysis would be useful here
because it is amending existing fees, not proposing to charge a new
fee where existing subscribers may terminate connections because
they are no longer enjoying the service at no cost.
---------------------------------------------------------------------------

    Lastly, the Exchange does not believe its proposal to implement
incrementally higher fees for those that purchase more Limited Service
MEI Ports will place certain market participants at a relative
disadvantage to other market participants because those with the
greatest number of Limited Service MEI Ports tend generate a
disproportionate amount of messages and order traffic, usually billions
per day across the Exchange, resulting in greater demands and
additional burdens on Exchange resources (as described above). The
firms that purchase numerous Limited Service MEI Ports do so for
competitive reasons and choose to utilize numerous connections based on
their business needs, which include a desire to attempt to access the
market quicker using the lowest latency connections. These firms are
generally engaged in sending liquidity removing orders to the Exchange
and seek to add more connections to competitively access resting
liquidity. All firms purchase the amount of Limited Service MEI Ports
they require based on their own business decisions and similarly
situated firms are subject to the same fees.
Inter-Market Competition
    The Exchange also does not believe that the proposed rule change
and price increase will result in any burden on inter-market
competition that is not necessary or appropriate in furtherance of the
purposes of the Act. As this is a fee increase, arguably if set too
high, this fee would make it easier for other exchanges to compete with
the Exchange. Only if this were a substantial fee decrease could this
be considered a form of predatory pricing. In contrast, the Exchange
believes that, without this fee increase, we are potentially at a
competitive disadvantage to certain other exchanges that have in place
higher fees for similar services. As we have noted, the Exchange
believes that connectivity fees can be used to foster more competitive
transaction pricing and additional infrastructure investment and there
are other options markets of which market participants may connect to
trade options at higher rates than the Exchange's. Accordingly, the
Exchange does not believe its proposed fee changes impose any burden on
competition that is not necessary or appropriate in furtherance of the
purposes of the Act.
    The Exchange also believes that the proposed fees for 10Gb
connectivity are appropriate and warranted and would not impose any
burden on competition. This is a technology driven change designed to
meet customer needs. The proposed fees would assist the Exchange in
recovering costs related to providing dedicated 10Gb connectivity to
the Exchange while enabling it to continue to meet current and
anticipated demands for connectivity by its Members and other market
participants. Separating its 10Gb network from MIAX Pearl Options
enables the Exchange to better compete with other exchanges by ensuring
it can continue to provide adequate connectivity to existing and new
Members, which may increase in ability to compete for order flow and
deepen its liquidity pool, improving the overall quality of its market.
The proposed rates for 10Gb ULL connectivity are structured to enable
the Exchange to bifurcate its 10Gb ULL network shared with MIAX Pearl
Options so that it can continue to meet current and anticipated
connectivity demands of all market participants.
    Similarly, and also in connection with a technology change, Cboe
Exchange, Inc. (``Cboe'') amended its access and connectivity fees,
including port fees.\143\ Specifically, Cboe adopted certain logical
ports to allow for the delivery and/or receipt of trading messages--
i.e., orders, accepts, cancels, transactions, etc. Cboe established
tiered pricing for BOE and FIX logical ports, tiered pricing for BOE
Bulk ports, and flat prices for DROP, Purge Ports, GRP Ports and
Multicast PITCH/Top Spin Server Ports. Cboe argued in its fee proposal
that the proposed pricing more closely aligned its access fees to those
of its affiliated exchanges as the affiliated exchanges offer
substantially similar connectivity and functionality and are on the
same platform that Cboe migrated to.\144\ Cboe justified its proposal
by stating that, ``. . . the Exchange believes substitutable products
and services are in fact available to market participants, including,
among other things, other options exchanges a market participant may
connect to in lieu of the Exchange, indirect connectivity to the
Exchange via a third-party reseller of connectivity and/or trading of
any options product, including proprietary products, in the Over-the-
Counter (OTC) markets.'' \145\ The Exchange concurs with the following
statement by CBOE,
---------------------------------------------------------------------------

    \143\ See Securities Exchange Act Release No. 90333 (November 4,
2020), 85 FR 71666 (November 10, 2020) (SR-CBOE-2020-105). The
Exchange notes that Cboe submitted this filing after the Staff
Guidance and contained no cost based justification.
    \144\ Id. at 71676.
    \145\ Id.
---------------------------------------------------------------------------

    The rule structure for options exchanges are also fundamentally
different from those of equities exchanges. In particular, options
market participants are not forced to connect to (and purchase market
data from) all options exchanges. For example, there are many order
types that are available in the equities markets that are not utilized
in the options markets, which relate to mid-point pricing and pegged
pricing which require connection to the SIPs and each of the equities
exchanges in order to properly execute those orders in compliance with
best execution obligations. Additionally, in the options markets, the
linkage routing and trade through protection are handled by the
exchanges, not by the individual members. Thus not connecting to an
options exchange or disconnecting from an options exchange does not
potentially subject a broker-dealer to violate order protection

requirements. Gone are the days when the retail brokerage firms (such
as Fidelity, Schwab, and eTrade) were members of the options
exchanges--they are not members of the Exchange or its affiliates, they
do not purchase connectivity to the Exchange, and they do not purchase
market data from the Exchange. Accordingly, not only is there not an
actual regulatory requirement to connect to every options exchange, the
Exchange believes there is also no ``de facto'' or practical
requirement as well, as further evidenced by the recent significant
reduction in the number of broker-dealers that are members of all
options exchanges.\146\
---------------------------------------------------------------------------

    \146\ Id. at 71676.
---------------------------------------------------------------------------

    The Cboe proposal also referenced the National Market System Plan
Governing the Consolidated Audit Trail (``CAT NMS Plan''),\147\ wherein
the Commission discussed the existence of competition in the
marketplace generally, and particularly for exchanges with unique
business models. The Commission acknowledged that, even if an exchange
were to exit the marketplace due to its proposed fee-related change, it
would not significantly impact competition in the market for exchange
trading services because these markets are served by multiple
competitors.\148\ Further, the Commission explicitly stated that
``[c]onsequently, demand for these services in the event of the exit of
a competitor is likely to be swiftly met by existing competitors.''
\149\ Finally, the Commission recognized that while some exchanges may
have a unique business model that is not currently offered by
competitors, a competitor could create similar business models if
demand were adequate, and if a competitor did not do so, the Commission
believes it would be likely that new entrants would do so if the
exchange with that unique business model was otherwise profitable.\150\
---------------------------------------------------------------------------

    \147\ See Securities Exchange Act Release No. 86901 (September
9, 2019), 84 FR 48458 (September 13, 2019) (File No. S7-13-19).
    \148\ Id.
    \149\ Id.
    \150\ Id.
---------------------------------------------------------------------------

    Cboe also filed to establish a monthly fee for Certification
Logical Ports of $250 per Certification Logical Port.\151\ Cboe
reasoned that purchasing additional Certification Logical Ports, beyond
the one Certification Logical Port per logical port type offered in the
production environment free of charge, is voluntary and not required in
order to participate in the production environment, including live
production trading on the Exchange.\152\
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    \151\ See Securities Exchange Act Release No. 94512 (March 24,
2002), 87 FR 18425 (March 30, 2022) (SR-Cboe-2022-011). Cboe offers
BOE and FIX Logical Ports, BOE Bulk Logical Ports, DROP Logical
Ports, Purge Ports, GRP Ports and Multicast PITCH/Top Spin Server
Ports. For each type of the aforementioned logical ports that are
used in the production environment, the Exchange also offers
corresponding ports which provide Trading Permit Holders and non-
TPHs access to the Exchange's certification environment to test
proprietary systems and applications (i.e., ``Certification Logical
Ports'').
    \152\ See Securities Exchange Act Release No. 94512 (March 24,
2002), 87 FR 18425 (March 30, 2022) (SR-Cboe-2022-011).
---------------------------------------------------------------------------

    In its statutory basis, Cboe justified the new port fee by stating
that it believed the Certification Logical Port fee were reasonable
because while such ports were no longer completely free, TPHs and non-
TPHs would continue to be entitled to receive free of charge one
Certification Logical Port for each type of logical port that is
currently offered in the production environment.\153\ Cboe noted that
other exchanges assess similar fees and cited to NASDAQ LLC and
MIAX.\154\ Cboe also noted that the decision to purchase additional
ports is optional and no market participant is required or under any
regulatory obligation to purchase excess Certification Logical Ports in
order to access the Exchange's certification environment.\155\ Finally,
similar proposals to adopt a Certification Logical Port monthly fee
were filed by Cboe BYX Exchange, Inc.,\156\ BZX,\157\ and Cboe EDGA
Exchange, Inc.\158\
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    \153\ Id. at 18426.
    \154\ Id.
    \155\ Id.
    \156\ See Securities Exchange Act Release No. 94507 (March 24,
2002), 87 FR 18439 (March 30, 2022) (SR-CboeBYX-2022-004).
    \157\ See Securities Exchange Act Release No. 94511 (March 24,
2002), 87 FR 18411 (March 30, 2022) (SR-CboeBZX-2022-021).
    \158\ See Securities Exchange Act Release No. 94517 (March 25,
2002), 87 FR 18848 (March 31, 2022) (SR-CboeEDGA-2022-004).
---------------------------------------------------------------------------

    The Cboe fee proposals described herein were filed subsequent to
the D.C. Circuit decision in Susquehanna Int'l Grp., LLC v. SEC, 866
F.3d 442 (D.C. Cir. 2017), meaning that such fee filings were subject
to the same (and current) standard for SEC review and approval as this
proposal. In summary, the Exchange requests the Commission apply the
same standard of review to this proposal which was applied to the
various Cboe and Cboe affiliated markets' filings with respect to non-
transaction fees. If the Commission were to apply a different standard
of review to this proposal than it applied to other exchange fee
filings it would create a burden on competition such that it would
impair the Exchange's ability to make necessary technology driven
changes, such as bifurcating its 10Gb ULL network, because it would be
unable to monetize or recoup costs related to that change and compete
with larger, non-legacy exchanges.
* * * * *
    In conclusion, as discussed thoroughly above, the Exchange
regrettably believes that the application of the Revised Review Process
and Staff Guidance has adversely affected inter-market competition
among legacy and non-legacy exchanges by impeding the ability of non-
legacy exchanges to adopt or increase fees for their market data and
access services (including connectivity and port products and services)
that are on parity or commensurate with fee levels previously
established by legacy exchanges. Since the adoption of the Revised
Review Process and Staff Guidance, and even more so recently, it has
become extraordinarily difficult to adopt or increase fees to generate
revenue necessary to invest in systems, provide innovative trading
products and solutions, and improve competitive standing to the benefit
of non-legacy exchanges' market participants. Although the Staff
Guidance served an important policy goal of improving disclosures and
requiring exchanges to justify that their market data and access fee
proposals are fair and reasonable, it has also negatively impacted non-
legacy exchanges in particular in their efforts to adopt or increase
fees that would enable them to more fairly compete with legacy
exchanges, despite providing enhanced disclosures and rationale under
both competitive and cost basis approaches provided for by the Revised
Review Process and Staff Guidance to support their proposed fee
changes.

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

    The Exchange received one comment letter on the Initial Proposal,
one comment letter on the Second Proposal, and one comment letter on
the Third Proposal, all from the same commenter.\159\ In their letters,
the sole commenter seeks to incorporate comments submitted on previous
Exchange proposals to which the Exchange has previously responded. To
the extent the sole commenter has attempted to raise new issues in its
letters, the Exchange believes those issues are not germane to this
proposal

in particular, but rather raise larger issues with the current
environment surrounding exchange non-transaction fee proposals that
should be addressed by the Commission through rule making, or Congress,
more holistically and not through an individual exchange fee filing.
Among other things, the commenter is requesting additional data and
information that is both opaque and a moving target and would
constitute a level of disclosure materially over and above that
provided by any competitor exchanges.
---------------------------------------------------------------------------

    \159\ See letter from Brian Sopinsky, General Counsel,
Susquehanna International Group, LLP (``SIG''), to Vanessa
Countryman, Secretary, Commission, dated February 7, 2023, and
letters from Gerald D. O'Connell, SIG, to Vanessa Countryman,
Secretary, Commission, dated March 21, 2023 and May 24, 2023.
---------------------------------------------------------------------------

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\160\ and Rule 19b-4(f)(2) \161\ thereunder.
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.
---------------------------------------------------------------------------

    \160\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \161\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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 (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
file number SR-MIAX-2023-25 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-MIAX-2023-25. 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 (https://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
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. Do not
include personal identifiable information in submissions; you should
submit only information that you wish to make available publicly. We
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection. All
submissions should refer to file number SR-MIAX-2023-25 and should be
submitted on or before July 24, 2023.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\162\
---------------------------------------------------------------------------

    \162\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Vanessa A. Countryman,
Secretary.
[FR Doc. 2023-13999 Filed 6-30-23; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 76, Number 165 (Thursday, August 25, 2011)]
[Notices]
[Pages 53142-53143]
[FR Doc No: 2011-21752]

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Internal Agency Docket No. FEMA-4006-DR; Docket ID FEMA-2011-0001]

New Hampshire; Major Disaster and Related Determinations

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Notice.

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SUMMARY: This is a notice of the Presidential declaration of a major
disaster for the State of New Hampshire (FEMA-4006-DR), dated July 22,
2011, and related determinations.

DATES: Effective Date: July 22, 2011.

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

SUPPLEMENTARY INFORMATION: Notice is hereby given that, in a letter
dated July 22, 2011, the President issued a major disaster declaration
under the authority of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act, 42 U.S.C. 5121 et seq. (the ``Stafford
Act''), as follows:

    I have determined that the damage in certain areas of the State
of New Hampshire resulting from severe storms and flooding during
the period of May 26-30, 2011, is of sufficient severity and
magnitude to warrant a major disaster declaration under the Robert
T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C.
5121 et seq. (the ``Stafford Act''). Therefore, I declare that such
a major disaster exists in the State of New Hampshire.
    In order to provide Federal assistance, you are hereby
authorized to allocate from funds available for these purposes such
amounts as you find necessary for Federal disaster assistance and
administrative expenses.
    You are authorized to provide Public Assistance in the
designated areas and Hazard Mitigation throughout the State.
Consistent with the requirement that Federal assistance is
supplemental, any Federal funds provided under the Stafford Act for
Public Assistance and Hazard Mitigation will be limited to 75
percent of the total eligible costs.
    Further, you are authorized to make changes to this declaration
for the approved

assistance to the extent allowable under the Stafford Act.

    The Federal Emergency Management Agency (FEMA) hereby gives notice
that pursuant to the authority vested in the Administrator, under
Executive Order 12148, as amended, Craig A. Gilbert, of FEMA is
appointed to act as the Federal Coordinating Officer for this major
disaster.
    The following areas of the State of New Hampshire have been
designated as adversely affected by this major disaster:

    Coos and Grafton Counties for Public Assistance, including
direct Federal assistance.
    All counties within the State of New Hampshire are eligible to
apply 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.

W. Craig Fugate,
Administrator, Federal Emergency Management Agency.
[FR Doc. 2011-21752 Filed 8-24-11; 8:45 am]
BILLING CODE 9111-23-P


[Federal Register: March 22, 2006 (Volume 71, Number 55)]
[Notices]
[Page 14521-14522]
[DOCID:fr22mr06-68]

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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-OPP-2006-0165; FRL-7766-7]

Notice of Filing of Pesticide Petitions for Establishment of a
Regulation for Residues of Dimethenamid in or on Various Food and Feed
Commodities

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.

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SUMMARY: This notice announces the initial filing of pesticide
petitions proposing the establishment of regulations for residues of
dimethenamid, (R,S)-2-chloro-N-[(1-methyl-2-methoxy) ethyl]-N-(2,4-
dimethylthien-3-yl)-acetamide in or on various food and feed
commodities.

DATES: Comments must be received on or before April 21, 2006.

ADDRESSES: Submit your comments, identified by docket identification
(ID) number EPA-HQ-OPP-2006-0165 and pesticide petition numbers (PPs)
4E6844 and 0F6138, by one of the following methods:
     http://www.regulations.gov/. Follow the on-line

instructions for submitting comments.
     Mail: Public Information and Records Integrity Branch
(PIRIB) (7502C), Office of Pesticide Programs (OPP), Environmental
Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-
0001.
     Hand Delivery: Public Information and Records Integrity
Branch (PIRIB) (7502C), Office of Pesticide Programs (OPP),
Environmental Protection Agency, Rm. 119, Crystal Mall 2, 1801
S. Bell St., Arlington, VA, Attention: Docket ID number EPA-HQ-OPP-
2006-0165. The docket facility is open from 8:30 a.m. to 4 p.m., Monday
through Friday, excluding legal holidays. The telephone number for the
docket facility is<PHONE_NUMBER>. Such deliveries are only accepted
during the Docket's normal hours of operation, and special arrangements
should be made for deliveries of boxed information.
    Instructions: Direct your comments to docket ID number EPA-HQ-OPP-
2006-0165. EPA's policy is that all comments received will be included
in the public docket without change and may be made available on-line
at http://www.regulations.gov/, including any personal information

provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through regulations.gov or e-
mail. The http://www.regulations.gov website is an ``anonymous access''

system, which means EPA will not know your identity or contact
information unless you provide it in the body of your comment. If you
send an e-mail comment directly to EPA without going at
regulations.gov, your e-mail address will be captured automatically and
included as part of the comment that is placed in the public docket and
made available on the Internet. If you submit an electronic comment,
EPA recommends that you include your name and other contact information
in the body of your comment and with any disk or CD ROM you submit. If
EPA cannot read your comment due to technical difficulties and cannot
contact you for clarification, EPA may not be able to consider your
comment. Electronic files should avoid the use of special characters,
any form of encryption, and be free of any defects or viruses. For
additional information about EPA's public docket, visit the EPA Docket
Center homepage at http://www.epa.gov/epahome/dockets.htm/.

     Docket: All documents in the docket are listed in the
regulation.gov index. Although listed in the index, some information is
not publicly available, e.g., CBI or other information whose disclosure
is restricted by statute. Certain other material, such as copyrighted
material, will be publicly available only in hard copy. Publicly
available docket materials are available either electronically at
http://www.regulations.gov or in hard copy at the Public Information

and Records Integrity Branch (PIRIB) (7502C), Office of Pesticide
Programs (OPP), Environmental Protection Agency, Rm. 119, Crystal Mall
2, 1801 S. Bell St., Arlington, VA. The Docket Facility is
open from 8:30 a.m. to 4 p.m., Monday through Friday, excluding legal
holidays. The Docket telephone number is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Barbara Madden, Registration Division
(7505C), Office of Pesticide Programs, U. S. Environmental Protection
Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; 703-
305-6463; e-mail<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this Action Apply to Me?

    You may be potentially affected by this action if you are an
agricultural producer, food manufacturer, or pesticide manufacturer.
Potentially affected entities may include, but are not limited to:
     Crop production (NAICS code 111).
     Animal production (NAICS code 112).
     Food manufacturing (NAICS code 311).
     Pesticide manufacturing (NAICS code 32532).
    This listing is not intended to be exhaustive, but rather provides
a guide for readers regarding entities likely to be affected by this
action. Other types of entities not listed in this unit could also be
affected. The North American Industrial Classification System (NAICS)
codes have been provided to assist you and others in determining
whether this action might apply to certain entities. If you have any
questions regarding the applicability of this action to a particular
entity, consult the person under FOR FURTHER INFORMATION CONTACT.

B. What Should I Consider as I Prepare My Comments for EPA?

     1. Submitting CBI. Do not submit this information to EPA through
regulations.gov or e-mail. Clearly mark the part or all of the
information that you claim to be CBI. For CBI information in a disk or
CD ROM that you mail to EPA, mark the outside of the disk or CD ROM as
CBI and then identify electronically within the disk or CD ROM the
specific information that is claimed as CBI. In addition to one
complete version of the comment that includes information claimed as
CBI, a copy of the comment that does not contain the information
claimed as CBI must be submitted for inclusion in the public docket.
Information so marked will not be disclosed except in accordance with
procedures set forth in 40 CFR part 2.
    2. Tips for preparing your comments. When submitting comments,
remember to:
    i. Identify the document by docket number and other identifying
information (subject heading, Federal Register date and page number).
    ii. Follow directions. The Agency may ask you to respond to
specific questions or organize comments by referencing a Code of
Federal Regulations (CFR) part or section number.
    iii. Explain why you agree or disagree; suggest alternatives and
substitute language for your requested changes.
    iv. Describe any assumptions and provide any technical information
and/or data that you used.
    v. If you estimate potential costs or burdens, explain how you
arrived at your estimate in sufficient detail to allow for it to be
reproduced.
    vi. Provide specific examples to illustrate your concerns, and
suggest alternatives.
    vii. Explain your views as clearly as possible, avoiding the use of
profanity or personal threats.
    viii. Make sure to submit your comments by the comment period
deadline identified.

II. What Action is the Agency Taking?

    EPA is printing a summary of each pesticide petition received under
section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21
U.S.C. 346a, proposing the establishment or amendment of regulations in
40 CFR part 180 for residues of pesticide chemicals in or on various
food commodities. EPA has determined that these pesticide petitions
contain data or information regarding the elements set forth in FFDCA
section 408(d)(2); however, EPA has not fully evaluated the sufficiency
of the submitted data at this time or whether the data support granting
of these pesticide petitions. Additional data may be needed before EPA
rules on these pesticide petitions.
    Pursuant to 40 CFR 180.7(f), a summary of each petition included in
this notice, prepared by the petitioner along with a description of the
analytical method available for the detection and measurement of the
pesticide chemical residues is available on EPA's Electronic Docket at
http://www.regulations.gov/. To locate this information on the home

page of EPA's Electronic Docket, select ``Quick Search'' and type the
OPP docket ID number. Once the search has located the docket, clicking
on the ``Docket ID'' will bring up a list of all documents in the
docket for the pesticide including the petitions summary.

New Tolerance

    1. PP 4E6844. Interregional Research Project No. 4 (IR-4), Rutgers
University, 681 U. S. Highway 1 South, North Brunswick, NJ
08902-3390, proposes to establish tolerances for residues of the
dimethenamid, (R,S)-2-chloro-N-[(1-methyl-2-methoxy) ethyl]-N-(2,4-
dimethylthien-3-yl)-acetamide in or on food commodities onion, green;
onion, Welsh; leek; and shallot, fresh leaves at 0.01 parts per million
(ppm);
    2. PP 0F6138. Grass, forage at 0.05 ppm; grass, hay at 0.30 ppm;
grass, straw at 0.01 ppm; and grass, seed screenings at 0.01 ppm.
    The proposed analytical method uses extraction and clean-up
followed by quantification with capillary column gas chromatography
using thermionic nitrogen specific detector. A gas spectrometry/mass
spectrometry (GS/MS) method for identification is also available. This
method is not selective towards the dimethenamid isomer and is
therefore valid for residues from both racemic dimethenamid and the
enriched isomer dimethenamid-P. Tolerances are proposed based on a non-
isomer specific basis.

List of Subjects

    Environmental protection, Agricultural commodities, Feed additives,
Food additives, Pesticides and pests, Reporting and recordkeeping
requirements.

    Dated: March 6, 2006.
Lois Rossi,
Director, Registration Division, Office of Pesticide Programs.
[FR Doc. 06-2634 Filed 3-21-06; 8:45 am]

BILLING CODE 6560-50-S