[Federal Register Volume 87, Number 181 (Tuesday, September 20, 2022)]
[Notices]
[Pages 57527-57532]
[FR Doc No: 2022-20270]

=======================================================================
-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-95769; File No. SR-PHLX-2022-35]

Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend Equity 4,
Rules 3100, 3301A and 3301B

September 14, 2022.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on September 9, 2022, Nasdaq PHLX LLC (``Phlx'' or ``Exchange'')
filed with the Securities and Exchange Commission (the ``Commission'')
the proposed rule change as described in Items I and II below, which
Items have been prepared by the Exchange. The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
---------------------------------------------------------------------------

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

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

    The Exchange proposes to amend Equity 4, Rules 3100, 3301A and
3301B \3\ in light of planned changes to the System.
---------------------------------------------------------------------------

    \3\ References herein to Phlx Rules in the 3000 Series shall
mean Rules in Phlx Equity 4.
---------------------------------------------------------------------------

    The text of the proposed rule change is available on the Exchange's
website at https://listingcenter.nasdaq.com/rulebook/phlx/rules, at the
principal office of the Exchange, and at the Commission's Public
Reference Room.

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

    In its filing with the Commission, the Exchange included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed

any comments it received on the proposed rule change. The text of these
statements may be examined at the places specified in Item IV below.
The Exchange has prepared summaries, set forth in sections A, B, and C
below, of the most significant parts of such statements.

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

1. Purpose
    The Exchange is preparing to introduce a new upgraded version of
the OUCH Order entry protocol \4\ that will enable the Exchange to make
functional enhancements and improvements to specific Order Types \5\
and Order Attributes.\6\ Specifically, enhancements to OUCH will enable
the Exchange to upgrade the logic and implementation of these Order
Types and Order Attributes so that the features are more robust,
streamlined, and harmonized across the Exchange's Systems and Order
entry protocols. The Exchange developed OUCH with simplicity in mind,
and therefore, it presently lacks certain complex order handling
capabilities. By contrast, the Exchange specifically designed its RASH
Order Entry Protocol \7\ to support advanced functionality, including
discretion, random reserve, pegging and routing. The introduction of
OUCH upgrades will enable participants to utilize OUCH, in addition to
RASH, to enter Order Types that require advanced functionality. Thus,
the proposal does not seek to introduce new functionality, but rather,
it offers to OUCH users advanced functionality that already exists for
RASH users.
---------------------------------------------------------------------------

    \4\ The OUCH Order entry protocol is a proprietary protocol that
allows subscribers to quickly enter orders into the System and
receive executions. OUCH accepts limit Orders from members, and if
there are matching Orders, they will execute. Non-matching Orders
are added to the Limit Order Book, a database of available limit
Orders, where they are matched in price-time priority. OUCH only
provides a method for members to send Orders and receive status
updates on those Orders. See https://www.nasdaqtrader.com/Trader.aspx?id=OUCH.
    \5\ An ``Order Type'' is a standardized set of instructions
associated with an Order that define how it will behave with respect
to pricing, execution, and/or posting to the Exchange Book when
submitted to the Exchange. See Equity 1, Section 1(e).
    \6\ An ``Order Attribute'' is a further set of variable
instructions that may be associated with an Order to further define
how it will behave with respect to pricing, execution, and/or
posting to the Exchange Book when submitted to the Exchange. See id.
    \7\ The RASH (Routing and Special Handling) Order entry protocol
is a proprietary protocol that allows members to enter Orders,
cancel existing Orders and receive executions. RASH allows
participants to use advanced functionality, including discretion,
random reserve, pegging and routing. See http://nasdaqtrader.com/content/technicalsupport/specifications/TradingProducts/rash_sb.pdf.
---------------------------------------------------------------------------

    The Exchange plans to implement its enhancement of the OUCH
protocol sequentially, by Order Type and Order Attribute.\8\
---------------------------------------------------------------------------

    \8\ The Exchange notes that its sister exchange, Nasdaq BX,
Inc., filed a similar proposed rule changes with the Commission, see
SR-BX-2022-012 (filed August 12, 2012), and The Nasdaq Stock Market,
LLC plans to do so concurrently with this filing.
---------------------------------------------------------------------------

    To support and prepare for the introduction of OUCH upgrades, the
Exchange proposes to amend Rule 3301A pertaining to Order Types to
specify that, going forward, OUCH may be used to enter certain Order
Types together with certain Order Attributes, whereas now, Rule 3301A
specifies that RASH and FIX, but not OUCH, may be used to enter such
combinations of Order Types and Attributes. The Exchange also proposes
to adjust the current functionality of the Pegging,\9\ Reserve,\10\ and
Trade Now Order Attributes,\11\ as described below, so that they align
with how OUCH, once upgraded, will handle these Order Attributes going
forward.
---------------------------------------------------------------------------

    \9\ See Rule 3301B(d).
    \10\ See Rule 3301B(h).
    \11\ See Rule 3301B(l).
---------------------------------------------------------------------------

Changes to Use of Certain Order Types With Certain Order Attributes
    Pursuant to Rule 3301A(b), the availability of certain Order
Attributes for use with certain Order Types presently depends upon the
particular Order entry protocol a participant uses to enter its Order.
For Price to Comply and Price to Display Orders entered though OUCH,
the Reserve Size, Primary Pegging and Market Pegging, and Discretion
Attributes are not available to participants presently. For Non-
Displayed Orders entered through OUCH, the Primary Pegging, Market
Pegging, and Discretion Attributes are not available presently. The
Exchange proposes to amend Rule 3301A(b) so that for each of the Order
Types listed above, participants may utilize the corresponding Order
Attributes when participants enter their Orders using the upgraded
version of OUCH.
    Meanwhile, for Non-Displayed Orders with the Midpoint Pegging
Attribute, the behavior of such Orders presently varies, as set forth
in Rule 3301B(d), based upon whether a participant uses OUCH/FLITE or
RASH/FIX to enter them into the System. Going forward, the Exchange
proposes to amend the Rule to reference the amended version Rule
3301B(d) (discussed below), which will describe variances in behavior
involving Non-Displayed Orders with Midpoint Pegging which will no
longer depend strictly upon the Order entry protocol associated with
the Orders.
Changes to Midpoint Peg Post-Only Orders
    Presently, the behavior of Midpoint Peg Post-Only Orders also
varies depending upon whether a participant uses OUCH/FLITE or RASH/
FIX/QIX to enter them into the System. Amendments to the Rule are
needed because upgrades to OUCH will allow for OUCH to perform
functions that are currently available only using RASH or FIX. The
Exchange proposes to amend Rule 3301A(b)(6) so that variances in
Midpoint Peg Post-Only Order behavior will occur going forward, not
based upon use of any particular Order entry protocol, but instead
based upon whether the Midpoint Peg Post-Only Order is ``Fixed,'' i.e.,
the Order is pegged at the midpoint of the NBBO upon entry, and does
not adjust with subsequent changes to the midpoint of the NBBO, or
``Managed,'' i.e., the System adjusts the price of the Order after
entry in accordance with changes to the midpoint of the NBBO.
    Thus, whereas now, Rule 3301A(b)(6)(B) prescribes certain behavior
for Midpoint Peg Post-Only Orders entered through RASH or FIX where the
System will adjust the price after entry in accordance with shifts in
the midpoint of the NBBO, the Exchange proposes to state that such
behavior will apply to ``Managed Midpoint Peg Post-Only Orders,''
regardless of the Order entry protocol used to enter it. This proposed
amendment reflects the fact that going forward, OUCH may be used to
enter Managed Midpoint Peg Post-Only Orders.
    Likewise, whereas now, Rule 3301A(b)(6)(B) prescribes different
behavior for Midpoint Peg Post-Only Orders entered through OUCH or
FLITE where the System does not adjust the price of the Order after
entry in accordance with shifts in the midpoint of the NBBO, the
Exchange proposes to state that such behavior will apply to ``Fixed
Midpoint Peg Post-Only Orders,'' regardless of the Order entry protocol
used to enter it. Similarly, the Exchange proposes to amend text
describing the conditions under which the System will cancel these
Orders back to participants as applying to Fixed Midpoint Peg Post
Post-Only Orders, rather than Midpoint Peg Post-Only Orders entered
through OUCH or FLITE.

Changes to Market Maker Peg Orders
    Rule 3301B(b)(5)(A) presently provides that Market Maker Peg Orders
may be entered through RASH or FIX only. The Exchange proposes to amend
this provision to state that the upgraded version of OUCH may be used
to enter such Orders going forward.
Changes to Pegging Order Attribute
    In addition to the above, the Exchange proposes to amend Rule
3301B(d), which governs the Pegging Order Attribute, to account for the
new capabilities of the upgraded version of OUCH.
    As described in Rule 3301B(d), Pegging is an Order Attribute that
allows an Order to have its price automatically set with reference to
the NBBO. The Exchange offers three types of Pegging: Primary Pegging,
Market Pegging, and Midpoint Pegging.\12\ The behavior of each of these
types of Pegged Orders currently varies based upon the particular Order
entry protocol associated with their use. With the introduction of the
upgraded version of OUCH, these variances will narrow, as OUCH will be
capable of handling Pegged Orders similar to how RASH and FIX handle
them. However, variances will not disappear entirely, as the upgraded
version of OUCH will continue to handle Orders with Midpoint Pegging
that the System cancels in response to changes to the Midpoint (``Fixed
Midpoint Orders'') the same way that the current iteration of OUCH and
FLITE handles them.
---------------------------------------------------------------------------

    \12\ See Rule 3301B(d) (defining ``Primary Pegging as pegging
with reference to the inside quotation on the same side of the
market, ``Market Pegging'' as pegging with reference to the inside
quotation on the opposite side of the market, and ``Midpoint
Pegging'' as pegging with reference to the midpoint between the
inside bid and the inside offer).
---------------------------------------------------------------------------

    Indeed, pursuant to the proposed rule filing, the behavior of
Pegged Orders will no longer vary strictly by the Order entry protocol
that a participant uses; instead, variance will occur based upon
whether the Pegged Orders are subject to management during their
lifetimes, i.e., the Exchange may adjust the prices of those Orders
during their lifetimes. Managed Pegged Orders (``Peg Managed Orders'')
will include Primary Pegged and Market Pegged Orders entered using
OUCH, RASH, and FIX, as well as Midpoint Pegged Orders, entered using
the same protocols, which the System may update in response to changes
to the Midpoint (``Managed Midpoint Orders''). The Exchange will handle
Managed Midpoint Orders differently from non-managed Orders, i.e.,
Fixed Midpoint Orders, in like circumstances.
    The specific proposed amendments that effectuate the above are as
follows:
    Existing Rule 3301B(d) states that if, at the time of entry, there
is no price to which a Pegged Order, that has not been assigned a
Routing Order Attribute, can be pegged, or pegging would lead to a
price at which the Order cannot be posted, then the Order will not be
immediately available on the Exchange Book and will be entered once
there is a permissible price, provided, however, that the System will
cancel the Pegged Order if no permissible pegging price becomes
available within one second after Order entry.\13\ This existing
language applies to Primary, Market, and Midpoint Pegging Orders
entered through RASH/FIX, but not Orders entered through OUCH/FLITE.
The Exchange proposes to amend this provision of the Rule so that it
applies to ``Peg Managed Orders,'' rather than ``Pegged Orders,'' which
in practice will mean that the behavior it currently describes for
Primary Pegged and Market Pegged Orders entered through RASH/FIX will
also now apply to such Orders entered through the upgraded version of
OUCH, as well as to Managed Midpoint Orders entered through RASH/FIX/
upgraded OUCH.\14\ Moreover, the proposed amended provision would
provide for Managed Midpoint Orders that are not assigned a Routing
Order Attribute (or a Time in Force of IOC) to behave similarly if the
Inside Bid and Inside Offer are crossed (i.e., the Managed Midpoint
Order will not be immediately available on the Exchange Book unless and
until a permissible price emerges within one second of entry (or other
such time that the Exchange designates, at its discretion)).
---------------------------------------------------------------------------

    \13\ The Exchange may, in the exercise of its discretion, modify
the length of this one second time period by posting advance notice
of the applicable time period on its website.
    \14\ The Exchange also proposes to clarify that this provision
applies to a Peg Managed Order that has not been assigned a Routing
Order Attribute or a Time-in-Force of Immediate-Or-Cancel (``IOC'').
This additional amendment makes it clear that IOC orders in this
scenario will cancel immediately if no permissible pegging price is
available upon Order entry, rather than waiting up to one second
after Order entry to do so.
---------------------------------------------------------------------------

    Existing Rule 3301B(d) also states that if a Pegged Order has been
assigned a Routing Order Attribute, but there is no permissible price
to which the Order can be pegged at the time of entry, then the
Exchange will reject it, except that the Exchange will accept a
Displayed Order with Market Pegging and a Market or a Primary Pegged
Order with a Non-Display Attribute at their respective limit prices in
this circumstance. The Exchange again proposes to amend this provision
so that it applies to Peg Managed Orders, rather than Pegged Orders. It
also proposes to apply this provision to Managed Midpoint Orders that
are assigned a Routing Order Attribute, if the Inside Bid and Inside
Offer are crossed. Finally, as is explained further below, the Exchange
proposes to delete the last two sentences of this paragraph, which
describe the behavior of Orders with Midpoint Pegging, and move them to
the end of the next paragraph, which also pertains to Orders with
Midpoint Pegging. The Exchange proposes this organizational change for
ease of readability.
    As to the next paragraph of Rule 3301B(d), the Exchange proposes
several changes. First, the Exchange proposes to delete the first
sentence of this paragraph, which lists the Order entry protocols for
which Primary Pegging and Market Pegging are presently available (RASH
and FIX). This sentence is no longer needed because, as discussed
above, the Exchange proposes to add a new sentence that specifies that
all Peg Managed Orders will be available, not only through RASH and
FIX, but also through OUCH, going forward. Second, the Exchange
proposes to modify the second sentence of the paragraph, which
presently states that for an Order entered through OUCH or FLITE with
Midpoint Pegging, the Order will have its price set upon initial entry
to the Midpoint, unless the Order has a limit price, and that limit
price is lower than the Midpoint for an Order to buy (higher than the
Midpoint for an Order to sell), in which case the Order will be ranked
on the Exchange Book at its limit price. The Exchange proposes to apply
this language to Midpoint Pegging Orders generally, rather than only
Midpoint Pegging Orders entered through OUCH or FLITE, as it will apply
to both Fixed Midpoint Orders and Managed Midpoint Orders. Third, the
Exchange proposes to add and partially restate the following language
from the preceding paragraph:

    In the case of an Order with Midpoint Pegging, if the Inside Bid
and Inside Offer are locked, the Order will be priced at the locking
price; and for Orders with Midpoint Pegging entered through OUCH or
FLITE, if the Inside Bid and Inside Offer are crossed or if there is
no Inside Bid and/or Inside Offer, the Order will not be accepted.
However, even if the Inside Bid and Inside Offer are locked, an
Order with Midpoint Pegging that locked an Order on the Exchange
Book would execute. (Provided, however, that a Midpoint Peg Post-
Only Order would execute or post as described in Rule
3301A(b)(6)(A)).

    Specifically, the Exchange proposes to replace the phrase ``and for
Orders with Midpoint Pegging entered through OUCH or FLITE'' with ``and
for Fixed Midpoint Orders,'' because going forward, some Midpoint
Pegging Orders entered through the upgraded version of OUCH will not
behave in this manner; only Fixed Midpoint Orders will do so.\15\
---------------------------------------------------------------------------

    \15\ The Exchange also proposes to make a stylistic, non-
substantive change to this text by deleting the phrase ``In the case
of an Order with Midpoint Pegging.'' The Exchange believes this
phrase is no longer needed due to the fact that the new paragraph to
which it proposes to move the text clearly applies to Orders with
Midpoint Pegging.
---------------------------------------------------------------------------

    The Exchange proposes to amend the next paragraph, which describes
how the Exchange handles Orders with Midpoint Pegging entered through
OUCH or FLITE where the Exchange does not adjust the prices of the
Orders based on changes to the Inside Bid or Offer that occur after the
Orders post to the Exchange Book. The Exchange proposes to amend this
paragraph to state that it applies to Fixed Midpoint Orders (rather
than Orders with Midpoint Pegging entered through OUCH or FLITE) and to
state expressly that it applies to such Orders after they post to the
Exchange Book.
    The subsequent paragraph of Rule 3301B(d) describes how the
Exchange handles Pegged Orders entered through RASH or FIX where the
Exchange does adjust the prices of the Orders based on changes to the
relevant Inside Quotation that occur after the Orders Post to the
Exchange Book. Like the preceding paragraph, the Exchange proposes to
amend this paragraph to state that it applies to Peg Managed Orders
(rather than Orders entered through RASH or FIX with Pegging). The
Exchange also proposes to amend text in this paragraph, which states
that the Exchange will reject such an Order, if it assigned a Routing
Order Attribute, and if the price to which it is pegged becomes
unavailable or pegging would lead to a price at which it cannot be
posted. The proposed amended language states that the Exchange will
cancel such an Order back to the participant in these circumstances,
rather than ``reject'' it; the use of the term ``cancel'' is more
appropriate than ``reject'' in this provision insofar as the Exchange
only rejects Orders upon entry, but thereafter, it cancels them.
Consistent with amendments elsewhere in the proposal, the Exchange also
proposes to state that Managed Midpoint Orders assigned a Routing Order
Attribute will cancel back to the participant if the Inside Bid and
Inside Offer become crossed. The Exchange also proposes to qualify the
foregoing by noting that an Order with Market Pegging, or an Order with
Primary Pegging and a Non-Display Attribute, will be re-entered at its
limit price. Finally, the Exchange proposes to amend the subsequent
text, which presently reads as follows:

. . . if the Order is not assigned a Routing Order Attribute, the
Order will be removed from the Exchange Book and will be re-entered
once there is a permissible price, provided however, that the System
will cancel the Pegged Order if no permissible pegging price becomes
available within one second after the Order was removed and no
longer available on the Exchange Book (the Exchange may, in the
exercise of its discretion modify the length of this one second time
period by posting advance notice of the applicable time period on
its website).

    The Exchange proposes to amend this text to specify that it applies
to a ``Peg Managed Order,'' rather than simply an ``Order.''
Additionally in this clause, the Exchange proposes to add, after the
phrase, ``if [a Peg Managed Order] is not assigned a Routing Order
Attribute,'' the following text, for clarity: ``and the price to which
it is pegged becomes unavailable, pegging would lead to a price at
which the Order cannot be posted, or, in the case of a Managed Midpoint
Order, if the Inside Bid and Inside Offer become crossed, . . . .'' The
Exchange believes that these conditions are implicit in the existing
Rule text and should be made explicit to avoid confusion. Insofar as
this proposed amended text will now account for Managed Midpoint
Orders, then the Exchange proposes to delete the following existing
text, which will otherwise be duplicative:

    For an Order with Midpoint Pegging, if the Inside Bid and Inside
Offer become crossed or if there is no Inside Bid and/or Inside
Offer, the Order will be removed from the Exchange Book and will be
re-entered at the new midpoint once there is a valid Inside Bid and
Inside Offer that is not crossed; provided, however, that the System
will cancel the Order with Midpoint Pegging if no permissible price
becomes available within one second after the Order was removed and
no longer available on the Exchange Book (the Exchange may, in the
exercise of its discretion modify the length of this one second time
period by posting advance notice of the applicable time period on
its website).

    Finally, the Exchange proposes to restate the paragraph of Rule
3301B(d) that describes Pegging Order collars. In pertinent part, this
paragraph presently states that ``any portion of a Pegging Order that
could execute, either on the Exchange or when routed to another market
center, at a price of more than $0.25 or 5 percent worse than the NBBO
at the time when the order reaches the System, whichever is greater,
will be cancelled.'' The Exchange proposes to restate this text to
account for the fact that under certain conditions, the System will
cancel Pegging Orders before clearing liquidity inside the collar. For
non-routable Pegged Orders, the System cancels these Orders prior to
polling the Exchange Book for liquidity (even inside of the collar)
when the combination of limit price, pegging, offset, discretionary
price, discretionary pegging, and discretionary offset attributes would
result in the Order attempting to post to the book or clear resting
Orders beyond the collar price (even if such liquidity does not
exist).\16\ For routable Primary or Market Peg Orders, by contrast, the
System will clear any liquidity inside of the collar before
cancelling.\17\ The Exchange proposes to more precisely describe this
behavior with the following restated text:
---------------------------------------------------------------------------

    \16\ For example, if NYSE is quoting $10.00 x $11.00 and a
Displayed Sell Order of 100 shares is setting the NBO by resting on
the Book at $10.05, then an incoming Primary Peg Buy order with a
Limit Price of $10.75 and an Offset Value of $0.56 will be cancelled
back without executing against the resting order at $10.05. The
Primary Peg attribute initially sets the price of the Order at
$10.00, then the offset amends the price to $10.56; the collar price
is set to $10.05 + ($10.05 x 5%) = $10.5525, which is less than the
price the incoming Order would attempt to book at.
    \17\ For example, if NYSE is quoting $10.00 x $11.00 and a
Displayed Sell Order of 100 shares is setting the NBO by resting on
the Book at $10.05, then an incoming Primary Peg Buy order of 200
shares with a Limit Price of $10.75, an Offset Value of $0.56, and
the SCAN routing strategy will execute against the resting order
before the remainder is cancelled before booking outside the collar
price.

    Any portion of a Pegging Order with a Routing attribute to buy
(sell) that could execute, either on the Exchange or when routed to
another market center, at a price of more than the greater of $0.25
or 5 percent higher (lower) than the NBO (NBB) at the time when the
order reaches the System (the ``Collar Price''), will be cancelled.
An Order entered without a Routing attribute will be cancelled if it
would, as a result of the price determined by a Pegging or
Discretionary Pegging attribute, execute or post to the Exchange
Book at a price through the Collar Price.
Change to Reserve Attribute
    The Exchange proposes to amend its rules governing the Reserve
Order Attribute, at Rule 3301B(h) to state that when a Reserve Order is
entered using OUCH with a displayed size of an odd lot, the System will
reject the Order, whereas if such an order is entered using RASH or
FIX, then as is the case now under the existing Rule, the System will
accept the Order but with the full

size of the Order Displayed. The Exchange believes that this new
proposed behavior will benefit participants insofar as Reserve Orders
entered with odd lot displayed sizes are often the product of errors.
Rather than expose erroneous displayed sizes, OUCH will cancel the
Orders and thus provide participants with an opportunity to correct
their errors, or to validate their original choices, by re-entering the
Reserve Order.
Change to Trade Now Attribute
    The Exchange proposes to amend its rules governing the Trade Now
Order Attribute, at Rule 3301B(l) to state that when the Trade Now
Attribute is entered through RASH or FIX, and going forward, also
through OUCH, the Trade Now Order Attribute may be enabled on an order-
by-order or a port-level basis. In the next sentence in the paragraph,
the existing text will continue to apply, but as to FLITE only, and not
to OUCH. Thus, when entered through FLITE (but not OUCH), the Trade Now
Order Attribute may be enabled on a port-level basis for all Order
Types that support it, and for the Non-Displayed Order Type, also on an
order-by-order basis.
    The Exchange proposed to amend its rules governing Limit Up-Limit
Down (``LULD'') functionality, at Rule 4120(a)(13)(E)(2)(a) to state
that limit priced orders entered via the OUCH protocol, which are not
assigned a Managed Pegging, Discretionary, or Reserve Attribute, shall
be repriced upon entry only if the Price Bands are such that the price
of the limit-priced interest to buy (sell) would be above (below) the
upper (lower) Price Band. Additionally, the Exchange is proposing to
amend Rule 4120(a)(13)(E)(2)(b) to state that limit-priced orders
entered via RASH or FIX protocols, or via the OUCH protocol if assigned
a Managed Pegging, Discretionary, or Reserve Attribute, the order shall
be eligible to be repriced by the system multiple times if the Price
Bands move such that the price of resting limit-priced interest to buy
(sell) would be above (below) the upper (lower) Price Band.
    The Exchange intends to implement the foregoing changes on October
10, 2022.
---------------------------------------------------------------------------

    \18\ 15 U.S.C. 78f(b).
    \19\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\18\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\19\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest.
    Generally speaking, it is consistent with the Act to amend the
Rulebook to reflect upgrades to the Exchange's OUCH Order entry
protocols. The planned upgrades will enable members to utilize OUCH in
additional circumstances, including for the entry of: (1) Price to
Comply and Price to Display Orders with the Reserve Size, Primary and
Market Pegging, and Discretion Order Attributes; (2) Non-Displayed
Orders with the Primary and Market Pegging, Midpoint Pegging (in
scenarios described in amended Rule 3301B(d)), and Discretion Order
Attributes; and (3) Market Maker Peg Orders.
    Similarly, it is consistent with the Act to amend Rule 3301B(b)(6),
which describes the behavior of Midpoint Peg Post-Only Orders, to
reflect the fact that the planned upgrades to OUCH will enable its use
for the entry of ``Managed'' Midpoint Peg Post-Only Orders--i.e., those
for which the System updates price after entry along with movements to
the midpoint of the NBBO. Presently, members may enter Managed Midpoint
Peg Post-Only Orders only through RASH or FIX. It is also consistent
with the Act to refer to such Orders as ``Managed'' while referring to
Midpoint Peg Post-Only Orders, whose prices do not change after entry,
even if the NBBO midpoint shifts, as ``Fixed'' Midpoint Peg Post-Only
Orders. This terminology will avoid confusion that would otherwise
arise from the fact that OUCH may be used, going forward, to enter both
types of Orders.
    Likewise, the Exchange believes that its proposed amendments to the
Pegging Order Attribute, at Rule 3301B(d), are consistent with the Act.
The proposed amendments account for the fact that OUCH will become
capable of use for the entry of Peg Managed Orders, including Managed
Midpoint Orders, in addition to Fixed Midpoint Orders. The Exchange
believes that it will be clearer and more coherent to describe the
behavior of Pegged Orders and Orders with Midpoint Pegging in the Rule
with regard to whether these Orders are ``Managed'' or ``Fixed,''
rather than with regard to the protocol used to enter them, especially
as OUCH will be available for use in entering both Managed and Fixed
Pegging Orders going forward. Additionally, proposed amendments to Rule
3301B(d) would reorganize the description of the behavior of various
types of Pegged Orders so that it flows more logically and is more
readily comprehensible. Finally, proposed changes would describe the
behavior of Pegged Orders more comprehensively, by adding language that
was mistakenly omitted from the Rule.
    Meanwhile, the Exchange's proposal to restate the Rule's
description of the price collar applicable to Pegged Orders is
consistent with the Act because it accounts for the fact that under
certain conditions, the System will cancel Pegging Orders before
clearing liquidity inside the collar.
    The Exchange's proposal is consistent with the Act to amend its
Rule governing the Reserve Order Attribute, at Rule 3301B(h) to state
that when a Reserve Order is entered using OUCH with a displayed size
of an odd lot, the System will reject the Order. The Exchange believes
that this new proposed behavior will benefit participants insofar as
Reserve Orders entered with odd lot displayed sizes are often the
product of errors. Rather than expose erroneous displayed sizes, OUCH
will cancel the Orders and thus provide participants with an
opportunity to correct their errors, or to validate their original
choices, by re-entering the Reserve Order.
    Additionally, the Exchange's proposal to amend its Rule governing
the Trade Now Order Attribute, at Rule 3301B(l), is consistent with the
Act, because it accounts for the fact that when entered through the
upgraded version of OUCH, the Trade Now Order Attribute may be enabled
on an order-by-order or a port-level basis.
    Finally, the Exchange's proposal to amend its Rule governing the
Limit Up-Limit Down Mechanism, at Rules 3100(a)(2)(E)(2)(a) and
4120(a)(2)(E)(2)(b) are consistent with the Act because the proposed
amendments align with OUCH's capability going forward, once upgraded,
to handle certain Order Types and Order Attributes similar to how RASH
and FIX handle them. Additionally, as discussed above, variance will
occur in certain Order Types based upon whether the orders are subject
to management during their lifetimes.

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

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. As a general principle, the
proposed changes are reflective of the significant competition among
exchanges and non-exchange

venues for order flow. In this regard, proposed changes that facilitate
enhancements to the Exchange's System and Order entry protocols as well
as those that amend and clarify the Exchange's Rules regarding its
Order Attributes, are pro-competitive because they bolster the
efficiency, functionality, and overall attractiveness of the Exchange
in an absolute sense and relative to its peers.
    Moreover, none of the proposed changes will unduly burden intra-
market competition among various Exchange participants. Participants
will experience no competitive impact from its proposals, as these
proposals will restate and reorganize portions of the Rule to reflect
the upgraded capabilities of OUCH, as well as to render the
descriptions of OUCH's new capabilities easier to read and understand.

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

    No written comments were either solicited or received.

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

    The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \20\ and Rule 19b-4(f)(6) thereunder.\21\
Because the foregoing proposed rule change does not: (i) significantly
affect the protection of investors or the public interest; (ii) impose
any significant burden on competition; and (iii) become operative prior
to 30 days from the date on which it was filed, or such shorter time as
the Commission may designate, it has become effective pursuant to
Section 19(b)(3)(A)(iii) of the Act \22\ and Rule 19b-4(f)(6)
thereunder.\23\
---------------------------------------------------------------------------

    \20\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \21\ 17 CFR 240.19b-4(f)(6).
    \22\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \23\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change, along
with a brief description and text of the proposed rule change, at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \24\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-PHLX-2022-35 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-PHLX-2022-35. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10 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. All comments received
will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-PHLX-2022-35 and should be submitted on
or before October 12, 2022.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\25\
---------------------------------------------------------------------------

    \25\ 17 CFR 200.30-3(a)(12), (59).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022-20270 Filed 9-19-22; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 77, Number 204 (Monday, October 22, 2012)]
[Notices]
[Pages 64571-64572]
[FR Doc No: 2012-25879]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68056; File No. SR-NSX-2012-16]

Self-Regulatory Organizations; National Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend its Rules To Clarify the Handling of Zero Displayed Reserve
Orders During Crossed Markets and To Add a Definition of a Primary Peg
Order

October 16, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on October 10, 2012, National Stock Exchange, Inc. (``Exchange''
or ``NSX'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------

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

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

    The Exchange is proposing to modify the text of Exchange Rule
11.11, 11.14 and 11.15 to (1) clarify that the Exchange's trading
system (the ``System'' \3\) will not execute a Zero Display Reserve
Order when the national best bid is priced higher than the national
best offer (i.e., a crossed market), and (2) add a definition of a
Primary Peg Order under Rule 11.11 (c)(2)(A).
---------------------------------------------------------------------------

    \3\ The ``System'' refers to ``the electronic securities
communications and trading facility designated by the Board through
which orders of Users are consolidated for ranking and execution.''
See Exchange Rule 1.5.
---------------------------------------------------------------------------

    The text of the proposed rule change is available on the Exchange's
Web site at http://www.nsx.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.

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

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

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

1. Purpose
    The Exchange is proposing to amend its rules to clarify that the
System will not execute Zero Display Reserve Orders during a crossed
market. A Zero Display Reserve Order is a Reserve Order for which the
entire order size remains hidden or undisplayed.
    Exchange Rule 11.15(a)(iv) sets forth the manner in which Zero
Display Reserve Orders are executed. Currently, the System will not
execute a Zero Display Reserve Order during a crossed market. The
Exchange is proposing to amend Rules 11.11(c)(2)(A) and 11.11(c)(2)(D),
11.14(a)(4) and Rule 11.15(a)(iv) in order to provide that (i) Zero
Display Reserve Orders will not execute during crossed markets, and
(ii) such Zero Display Reserve Orders will be eligible for execution
when the market uncrosses (i.e., the protected bid is priced lower than
the protected offer). The Exchange will make other clarifying edits to
similar rules in an effort to maintain clear and cohesive Exchange
rules.
    Exchange Rule 11.15(a)(iv) currently provides that a Zero Display
Reserve Order designated as a Post Only Order which is marketable upon
entry, but not executed pursuant to Rule 11.11(c)(5)(B), is ranked in
the NSX Book and ``matched for execution in accordance with Rule
11.15.'' The Exchange proposes to amend the language in Rule
11.15(a)(iv) to explicitly provide that Zero Display Reserve Orders
will not execute during a crossed market. The Exchange is also
proposing to add language to Rule 11.15(a)(iv) to clarify that these
orders, if not cancelled during this period, will be executed when the
protected bid is priced lower than the protected offer.
    The Exchange sets forth the execution priority for Reserve Orders,
including Zero Display Reserve Orders, in Rule 11.14. Under this rule,
Reserve Orders have time priority over Zero Display Reserve Orders. The
time priority among Zero Display Reserve Orders at the same price is
established by several factors including whether the order has a
Minimum Execution Quantity Instruction.\4\ The Exchange is proposing to
amend Rule 11.14(a)(4) to clarify that each Zero Display Reserve Order
will retain its time priority when the System does not execute the
order during a crossed market.
---------------------------------------------------------------------------

    \4\ See Exchange Rule 11.14(a)(4).
---------------------------------------------------------------------------

    These clarifying amendments provide Equity Trading Permit (``ETP'')
holders with additional information regarding how the System executes
Reserve Orders and Zero Display Reserve Orders. The Exchange further
proposes to clarify this notion in Rule 11.11(c)(2)(D) by referencing
the execution process for Zero Display Reserve Orders set forth in
11.15(a)(iv). Currently, Rule 11.11(c)(2)(D) notifies ETP Holders that
Zero Display Reserve Orders will not be eligible for routing to away
Trading Centers. By adding the

proposed language, ETP Holders will also be on notice that such orders
will not be eligible for execution when the market is crossed.\5\ In
addition, as a clarifying change, in an attempt to make Exchange rules
more consistent, the Exchange is proposing to capitalize ``Trading
Center'' as the term is defined in Rule 2.11.\6\
---------------------------------------------------------------------------

    \5\ ETP holders have expressed to the Exchange their preference
that their Zero Reserve
    Display Orders not be executed when the market is crossed
because it would result in inferior execution. In addition, other
exchanges do not execute similar orders where the market is crossed.
See CBOE Rule 51.8(g)(10).
    \6\ See Exchange Rule 2.11.
---------------------------------------------------------------------------

    Finally, the Exchange proposes to make some clarifying
modifications to the Zero Display Reserve Order Rules in Exchange Rule
11.11(c)(2)(A). Namely, the Exchange is proposing to clarify the
Exchange's language addressing Zero Display Reserve Orders, in general,
by adding the definition of a ``Primary Peg''. In the proposed
language, a Primary Peg is ``a pegged Zero Display Reserve Order that
tracks the inside quote of the same side of the market.'' This order
type is currently offered by the Exchange, and the Exchange is,
therefore, proposing to modify this Rule to make clear that the Primary
Peg Order type is available to users. The Exchange also proposes to add
this language to clarify to ETP Holders all modifiers that may be used
in the NSX System with respect to Zero Display Reserve Orders.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
Section 6 of the Act),\7\ and the rules and regulations thereunder and,
in particular, the requirements of Section 6(b) of the Act.\8\
Specifically, the Exchange believes the modification of Rule 11.11,
11.14, and 11.15 furthers the objective of Section 6(b)(5) of the Act
because it clearly explains how the Exchange handles Zero Display
Reserve Orders when the protected bid is priced higher than the
protected offer in NMS stock. Furthermore, incorporating a definition
of the Primary Peg Order type will provide ETP Holders clarity as to
how those orders are to be handled by the Exchange. Accordingly, the
Exchange believes that the proposed rule change promotes just and
equitable principles of trade, will remove impediments to, and perfect
the mechanism of a free and open market and a national market system
and, in general, protects investors and the public interest.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f.
    \8\ 15 U.S.C. 78f(b).
---------------------------------------------------------------------------

    The proposed rule change provides transparency and certainty with
respect to how certain orders are executed on the Exchange. In so
doing, the proposed rule change promotes the maintenance of a fair and
orderly market, the protection of investors and the protection of the
public interest, consistent with the Act and the rules promulgated
thereunder.

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.

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

    Written comments on the proposed rule change were neither solicited
nor received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \9\ and Rule 19-
4(f)(6)(iii) thereunder.\10\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written
notice of its intent to file the proposed rule change along with a
brief description and the text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission.
---------------------------------------------------------------------------

    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.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NSX-2012-16 on the subject line.

Paper Comments

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

    All submissions should refer to File Number SR-NSX-2012-16. 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 Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make publicly available. All
submissions should refer to File Number SR-NSX-2012-16 and should be
submitted on or before November 13, 2012.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-25879 Filed 10-19-12; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 82, Number 77 (Monday, April 24, 2017)]
[Notices]
[Page 18913]
[FR Doc No: 2017-08183]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2014-N-0179]

Training Program for Regulatory Project Managers; Information
Available to Industry

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration's (FDA's) Center for Drug
Evaluation and Research (CDER) is announcing the continuation of the
Regulatory Project Management Site Tours and Regulatory Interaction
Program (the Site Tours Program). The purpose of this document is to
invite pharmaceutical companies interested in participating in this
program to contact CDER.

DATES: Pharmaceutical companies may send proposed agendas to the Agency
by June 23, 2017.

FOR FURTHER INFORMATION CONTACT: Dan Brum, Center for Drug Evaluation
and Research, Food and Drug Administration, 10903 New Hampshire Ave.,
Bldg. 22, Rm. 5480, Silver Spring, MD 20993-0002,<PHONE_NUMBER>,
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Background

    An important part of CDER's commitment to make safe and effective
drugs available to all Americans is optimizing the efficiency and
quality of the drug review process. To support this primary goal, CDER
has initiated various training and development programs to promote high
performance in its regulatory project management staff. CDER seeks to
significantly enhance review efficiency and review quality by providing
the staff with a better understanding of the pharmaceutical industry
and its operations. To this end, CDER is continuing its training
program to give regulatory project managers the opportunity to tour
pharmaceutical facilities. The goals are to provide the following: (1)
Firsthand exposure to industry's drug development processes and (2) a
venue for sharing information about project management procedures (but
not drug-specific information) with industry representatives.

II. The Site Tours Program

    In this program, over a 2- to 3-day period, small groups (five or
less) of regulatory project managers, including a senior level
regulatory project manager, can observe operations of pharmaceutical
manufacturing and/or packaging facilities, pathology/toxicology
laboratories, and regulatory affairs operations. Neither this tour nor
any part of the program is intended as a mechanism to inspect, assess,
judge, or perform a regulatory function, but is meant rather to improve
mutual understanding and to provide an avenue for open dialogue. During
the Site Tours Program, regulatory project managers will also
participate in daily workshops with their industry counterparts,
focusing on selective regulatory issues important to both CDER staff
and industry. The primary objective of the daily workshops is to learn
about the team approach to drug development, including drug discovery,
preclinical evaluation, tracking mechanisms, and regulatory submission
operations. The overall benefit to regulatory project managers will be
exposure to project management, team techniques, and processes employed
by the pharmaceutical industry. By participating in this program, the
regulatory project manager will grow professionally by gaining a better
understanding of industry processes and procedures.

III. Site Selection

    All travel expenses associated with the Site Tours Program will be
the responsibility of CDER; therefore, selection will be based on the
availability of funds and resources for each fiscal year. Selection
will also be based on firms having a favorable facility status as
determined by FDA's Office of Regulatory Affairs District Offices in
the firms' respective regions. Firms that want to learn more about this
training opportunity or that are interested in offering a site tour
should respond by sending a proposed agenda by email directly to Dan
Brum (see DATES and FOR FURTHER INFORMATION CONTACT).

    Dated: April 17, 2017.
Anna K. Abram,
Deputy Commissioner for Policy, Planning, Legislation, and Analysis.
[FR Doc. 2017-08183 Filed 4-21-17; 8:45 am]
 BILLING CODE 4164-01-P


[Federal Register Volume 86, Number 77 (Friday, April 23, 2021)]
[Proposed Rules]
[Pages 21669-21672]
[FR Doc No: 2021-08373]

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2021-0250; Airspace Docket No. 20-AEA-22]
RIN 2120-AA66

Proposed Establishment and Amendment of Area Navigation Routes,
Northeast Corridor Atlantic Coast Routes; Northeastern United States

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: This action proposes to modify three existing high altitude
area navigation (RNAV) routes (Q-routes), and establish one new Q-
route, in support of the Northeast Corridor Atlantic Coast Route (NEC
ACR) Project. This proposal would improve the efficiency of the
National Airspace System (NAS) by expanding the availability of RNAV
routing and reducing the dependency on ground-based navigational
systems.

DATES: Comments must be received on or before June 7, 2021.

ADDRESSES: Send comments on this proposal to the U.S. Department of
Transportation, Docket Operations, 1200 New Jersey Avenue SE, West
Building Ground Floor, Room W12-140, Washington, DC 20590; telephone: 1
(800) 647-5527 or<PHONE_NUMBER>. You must identify FAA Docket No. FAA-
2021-0250; Airspace Docket No. 20-AEA-22 at the beginning of your
comments. You may also submit comments through the internet at https://www.regulations.gov.
    FAA Order 7400.11E, Airspace Designations and Reporting Points, and
subsequent amendments can be viewed online at httsp://www.faa.gov/
air_traffic/publications/. For further information, you can contact the
Rules and Regulations Group, Federal Aviation Administration, 800
Independence Avenue SW, Washington, DC 20591; telephone: (202) 267-
8783. The Order is also available for inspection at the National
Archives and Records Administration (NARA). For information on the
availability of FAA Order 7400.11E at NARA, email:
<EMAIL_ADDRESS>or go to https://www.archives.gov/federal-register/cfr/ibr-locations.html.

FOR FURTHER INFORMATION CONTACT: Paul Gallant, Rules and Regulations
Group, Office of Policy, Federal Aviation Administration, 800
Independence Avenue SW, Washington, DC 20591; telephone: (202) 267-
8783.

SUPPLEMENTARY INFORMATION:

Authority for This Rulemaking

    The FAA's authority to issue rules regarding aviation safety is
found in Title 49 of the United States Code. Subtitle I, Section 106
describes the authority of the FAA Administrator. Subtitle VII,
Aviation Programs, describes in more detail the scope of the agency's
authority. This rulemaking is promulgated under the authority described
in Subtitle VII, Part A, Subpart I, Section 40103. Under that section,
the FAA is charged with prescribing regulations to assign the use of
the airspace necessary to ensure the safety of aircraft and the
efficient use of airspace. This regulation is within the scope of that
authority as it would expand the availability of RNAV routes in the
NAS, increase airspace capacity, and reduce complexity in high air
traffic volume areas.

Comments Invited

    Interested parties are invited to participate in this proposed
rulemaking by submitting such written data, views, or arguments as they
may desire. Comments that provide the factual basis supporting the
views and suggestions presented are particularly helpful in developing
reasoned regulatory decisions on the proposal. Comments are
specifically invited on the overall regulatory, aeronautical, economic,
environmental, and energy-related aspects of the proposal.
    Communications should identify both docket numbers (FAA Docket No.
FAA-2021-0250; Airspace Docket No. 20-

AEA-22) and be submitted in triplicate to the Docket Management
Facility (see ADDRESSES section for address and phone number). You may
also submit comments through the internet at https://www.regulations.gov.
    Commenters wishing the FAA to acknowledge receipt of their comments
on this action must submit with those comments a self-addressed,
stamped postcard on which the following statement is made: ``Comments
to FAA Docket No. FAA-2021-0250; Airspace Docket No. 20-AEA-22.'' The
postcard will be date/time stamped and returned to the commenter.
    All communications received on or before the specified comment
closing date will be considered before taking action on the proposed
rule. The proposal contained in this action may be changed in light of
comments received. All comments submitted will be available for
examination in the public docket both before and after the comment
closing date. A report summarizing each substantive public contact with
FAA personnel concerned with this rulemaking will be filed in the
docket.

Availability of NPRM's

    An electronic copy of this document may be downloaded through the
internet at https://www.regulations.gov. Recently published rulemaking
documents can also accessed through the FAA's web page at https://www.faa.gov/air_traffic/publications/airspace_amendments/.
    You may review the public docket containing the proposal, any
comments received and any final disposition in person in the Dockets
Office (see ADDRESSES section for address and phone number) between
9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal
holidays. An informal docket may also be examined during normal
business hours at the office of the Eastern Service Center, Federal
Aviation Administration, Room 210, 1701 Columbia Ave., College Park, GA
30337.

Availability and Summary of Documents for Incorporation by Reference

    This document proposes to amend FAA Order 7400.11E, Airspace
Designations and Reporting Points, dated July 21, 2020, and effective
September 15, 2020. FAA Order 7400.11E is publicly available as listed
in the ADDRESSES section of this proposed rule. FAA Order 7400.11E
lists Class A, B, C, D, and E airspace areas, air traffic service
routes, and reporting points.

Background

    The Northeast Corridor Atlantic Coast Route (NEC ACR) project
developed Performance Based Navigation (PBN) routes involving the
Washington, Boston, New York, and Jacksonville Air Route Traffic
Control Centers (ARTCC). The proposed routes would enable aircraft to
travel from most locations along the east coast of the United States
mainland between Maine and Charleston, SC. The proposed NEC ACR routes
would also tie-in to the existing high altitude RNAV route structure
enabling more efficient direct routings between the U.S. east coast and
Caribbean area locations.
    The routes in this notice of proposed rulemaking were originally
part of a larger proposal that was published in the Federal Register
for Docket No. FAA-2020-0236 (85 FR 16572; March 24, 2020).
Subsequently, the restrictions imposed due to the COVID-19 pandemic
precluded the completion of the air traffic controller training needed
to implement all 30 route actions in the original proposal. As a
result, only eight of the proposed routes could be implemented from
Docket No. FAA-2020-0236 (85 FR 40089; July 6, 2020). An additional
four of those route actions are being proposed again in this NPRM.

The Proposal

    The FAA is proposing an amendment to 14 CFR part 71 to amend three
existing Q-routes, and establish 1 new Q-route, in the northeastern
United States to support the Northeast Corridor Atlantic Coast Route
project. The proposed new route would be designated Q-419. In addition,
amendments are proposed to the descriptions of the following existing
routes: Q-22, Q-54, and Q-64.
    The proposed new Q-route is as follows:
    Q-419: Q-419 would extend between the BROSS, MD, Fix, and the Deer
Park, NY (DPK), VOR/DME.
    The proposed Q-route amendments are as follows:
    Q-22: Q-22 extends between the GUSTI, LA, Fix, and the BEARI, VA,
WP. This action would extend Q-22 northeast from the BEARI, VA, WP to
the FOXWD, CT, WP. The following points would be inserted between the
BEARI, VA, and the FOXWD, CT, WPs: UMBRE, VA, WP; BBOBO, VA, WP; SHTGN,
MD, WP; SYFER, MD, WP; DANGR, MD, WP; PYTHN, DE, WP; BESSI, NJ, Fix;
JOEPO, NJ, WP; BRAND, NJ, Fix; Robbinsville, NJ (RBV), VORTAC; LAURN,
NY, Fix; LLUND, NY, Fix; and BAYYS, CT, Fix. As amended, Q-22 would
extend between GUSTI, LA and FOXWD, CT. This would provide RNAV routing
between Louisiana and the New England area.
    Q-54: Q-54 extends between the Greenwood, SC (GRD), VORTAC, and the
NUTZE, NC, WP. The proposal would remove the Greenwood VORTAC and add
the HRTWL, SC, WP as a new end point for the route. In addition, the
ASHEL, NC, WP would be added between the existing RAANE, NC, and the
NUTZE, NC, WPs.
    Q-64: Q-64 extends between the CATLN, AL, Fix, and the Tar River,
NC (TYI), VORTAC. The proposal would remove the Greenwood, SC (GRD),
VORTAC from the route and add the HRTWL, SC, WP between the FIGEY, GA
and the DARRL, SC, Fixes. The DADDS, NC, WP and the MARCL, NC, WPs
would be added between the existing IDDAA, NC, WP, and the Tar River
VORTAC. Additionally, the route would be extended northeast from the
Tar River VORTAC, through the GUILD, NC, WP to the SAWED, VA, Fix.
    Full route descriptions of the proposed new and amended routes are
listed in ``The Proposed Amendment'' section of this notice.
    The proposed new and amended routes in this notice would expand the
availability of high altitude RNAV routing along the eastern seaboard
of the U.S. The project is designed to increase airspace capacity and
reduce complexity in high volume areas through the use of optimized
routes through congested airspace.
    RNAV routes are published in paragraph 2006 of FAA Order 7400.11E
dated July 21, 2020, and effective September 15, 2020, which is
incorporated by reference in 14 CFR 71.1. The RNAV routes listed in
this document would be subsequently published in the Order.
    FAA Order 7400.11, Airspace Designations and Reporting Points, is
published yearly and effective on September 15.

Regulatory Notices and Analyses

    The FAA has determined that this proposed regulation only involves
an established body of technical regulations for which frequent and
routine amendments are necessary to keep them operationally current.
It, therefore: (1) Is not a ``significant regulatory action'' under
Executive Order 12866; (2) is not a ``significant rule'' under
Department of Transportation (DOT) Regulatory Policies and Procedures
(44 FR 11034; February 26, 1979); and (3) does not warrant preparation
of a regulatory evaluation as the anticipated impact is so minimal.
Since this is a routine

matter that will only affect air traffic procedures and air navigation,
it is certified that this proposed rule, when promulgated, will not
have a significant economic impact on a substantial number of small
entities under the criteria of the Regulatory Flexibility Act.

Environmental Review

    This proposal will be subject to an environmental analysis in
accordance with FAA Order 1050.1F, ``Environmental Impacts: Policies
and Procedures'' prior to any FAA final regulatory action.

List of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

    In consideration of the foregoing, the Federal Aviation
Administration proposes to amend 14 CFR part 71 as follows:

PART 71--DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR
TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

0
1. The authority citation for part 71 continues to read as follows:

    Authority: 49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O.
10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.

Sec.  71.1  [Amended]

0
2. The incorporation by reference in 14 CFR 71.1 of FAA Order 7400.11E,
Airspace Designations and Reporting Points, dated July 21, 2020, and
effective September 15, 2020, is amended as follows:

Paragraph 2006 United States Area Navigation Routes.

* * * * *

Q-419 BROSS, MD to Deer Park, NY (DPK) [New]

BROSS, MD                   FIX                  (Lat. 39[deg]11'28.40'' N, long. 075[deg]52'49.88'' W)
MYFOO, DE                   WP                   (Lat. 39[deg]26'10.15'' N, long. 075[deg]36'44.70'' W)
NACYN, NJ                   WP                   (Lat. 39[deg]36'49.19'' N, long. 075[deg]24'59.30'' W)
BSERK, NJ                   WP                   (Lat. 39[deg]47'27.01'' N, long. 075[deg]13'10.29'' W)
HULKK, NJ                   WP                   (Lat. 39[deg]59'53.04'' N, long. 074[deg]58'52.52'' W)
Robbinsville, NJ (RBV)      VORTAC               (Lat. 40[deg]12'08.65'' N, long. 074[deg]29'42.09'' W)
LAURN, NY                   FIX                  (Lat. 40[deg]33'05.80'' N, long. 074[deg]07'13.67'' W)
Kennedy, NY (JFK)           VOR/DME              (Lat. 40[deg]37'58.40'' N, long. 073[deg]46'17.00'' W)
Deer Park, NY (DPK)         VOR/DME              (Lat. 40[deg]47'30.30'' N, long. 073[deg]18'13.17'' W)

                                                  * * * * * * *
Q-22 GUSTI, LA to FOXWD, CT [Amended]

GUSTI, LA                   FIX                  (Lat. 29[deg]58'15.34'' N, long. 092[deg]54'35.29'' W)
OYSTY, LA                   FIX                  (Lat. 30[deg]28'15.21'' N, long. 090[deg]11'49.14'' W)
ACMES, AL                   WP                   (Lat. 30[deg]55'27.13'' N, long. 088[deg]22'10.82'' W)
CATLN, AL                   FIX                  (Lat. 31[deg]18'26.03'' N, long. 087[deg]34'47.75'' W)
TWOUP, GA                   WP                   (Lat. 33[deg]53'45.39'' N, long. 083[deg]49'08.39'' W)
Spartanburg, SC (SPA)       VORTAC               (Lat. 35[deg]02'01.05'' N, long. 081[deg]55'37.24'' W)
NYBLK, NC                   WP                   (Lat. 35[deg]34'34.99'' N, long. 081[deg]02'33.96'' W)
MASHI, NC                   WP                   (Lat. 35[deg]58'17.90'' N, long. 080[deg]23'04.71'' W)
KIDDO, NC                   WP                   (Lat. 36[deg]10'34.90'' N, long. 080[deg]02'23.69'' W)
OMENS, VA                   WP                   (Lat. 36[deg]49'29.00'' N, long. 078[deg]55'29.78'' W)
BEARI, VA                   WP                   (Lat. 37[deg]12'01.97'' N, long. 078[deg]15'23.85'' W)
UMBRE, VA                   WP                   (Lat. 37[deg]23'38.72'' N, long. 077[deg]49'09.50'' W)
BBOBO, VA                   WP                   (Lat. 37[deg]41'33.79'' N, long. 077[deg]07'57.59'' W)
SHTGN, MD                   WP                   (Lat. 38[deg]14'45.29'' N, long. 076[deg]44'52.23'' W)
SYFER, MD                   WP                   (Lat. 38[deg]25'19.31'' N, long. 076[deg]33'26.82'' W)
DANGR, MD                   WP                   (Lat. 38[deg]57'36.25'' N, long. 075[deg]58'30.85'' W)
PYTHN, DE                   WP                   (Lat. 39[deg]18'06.97'' N, long. 075[deg]33'59.66'' W)
BESSI, NJ                   FIX                  (Lat. 39[deg]40'34.84'' N, long. 075[deg]06'44.53'' W)
JOEPO, NJ                   WP                   (Lat. 39[deg]54'22.11'' N, long. 074[deg]52'17.73'' W)
BRAND, NJ                   FIX                  (Lat. 40[deg]02'06.28'' N, long. 074[deg]44'09.50'' W)
Robbinsville, NJ (RBV)      VORTAC               (Lat. 40[deg]12'08.65'' N, long. 074[deg]29'42.09'' W)
LAURN, NY                   FIX                  (Lat. 40[deg]33'05.80'' N, long. 074[deg]07'13.67'' W)
LLUND, NY                   FIX                  (Lat. 40[deg]51'45.04'' N, long. 073[deg]46'57.30'' W)
BAYYS, CT                   FIX                  (Lat. 41[deg]17'21.27'' N, long. 072[deg]58'16.73'' W)
FOXWD, CT                   WP                   (Lat. 41[deg]48'21.66'' N, long. 071[deg]48'07.03'' W)

                                                  * * * * * * *
Q-54 HRTWL SC to NUTZE, NC [Amended]

HRTWL, SC                   WP                   (Lat. 34[deg]15'05.33'' N, long. 082[deg]09'15.55: W)
NYLLA, SC                   WP                   (Lat. 34[deg]34'38.94'' N, long. 081[deg]17'00.48'' W)
CHYPS, NC                   WP                   (Lat. 34[deg]53'17.92'' N, long. 080[deg]25'57.04'' W)
AHOEY, NC                   WP                   (Lat. 35[deg]00'36.28'' N, long. 080[deg]05'55.93'' W)
RAANE, NC                   WP                   (Lat. 35[deg]09'21.97'' N, long. 079[deg]41'33.90'' W)
ASHEL, NC                   WP                   (Lat. 35[deg]25'43.32'' N, long. 078[deg]54'48.07'' W)
NUTZE, NC                   WP                   (Lat. 35[deg]50'40.43'' N, long. 077[deg]40'56.72'' W)

                                                  * * * * * * *
Q-64 CATLN, AL to SAWED, VA [Amended]

CATLN, AL                   FIX                  (Lat. 31[deg]18'26.03'' N, long. 087[deg]34'47.75'' W)
FIGEY, GA                   WP                   (Lat. 33[deg]52'26.94'' N, long. 082[deg]52'22.76'' W)
HRTWL, SC                   WP                   (Lat. 34[deg]15'05.33'' N, long. 082[deg]09'15.55'' W)
DARRL, SC                   FIX                  (Lat. 34[deg]47'49.47'' N, long. 081[deg]03'21.62'' W)
IDDAA, NC                   WP                   (Lat. 35[deg]11'05.10'' N, long. 079[deg]59'30.69'' W)
DADDS, NC                   WP                   (Lat. 35[deg]36'30.35'' N, long. 078[deg]47'20.70'' W)
MARCL, NC                   WP                   (Lat. 35[deg]43'54.41'' N, long. 078[deg]25'46.57'' W)
Tar River, NC (TYI)         VORTAC               (Lat. 35[deg]58'36.20'' N, long. 077[deg]42'13.43'' W)
GUILD, NC                   WP                   (Lat. 36[deg]18'49.56'' N, long. 077[deg]14'59.96'' W)
SAWED, VA                   FIX                  (Lat. 37[deg]32'00.73'' N, long. 075[deg]51'29.10'' W)

* * * * *

    Issued in Washington, DC, on April 19, 2021.
George Gonzalez,
Acting Manager, Rules and Regulations Group.
[FR Doc. 2021-08373 Filed 4-22-21; 8:45 am]
BILLING CODE 4910-13-P