[Federal Register: October 25, 2010 (Volume 75, Number 205)]
[Notices]
[Page 65546-65550]
[DOCID:fr25oc10-142]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-63126; File No. SR-NSCC-2010-11]

Self-Regulatory Organizations; National Securities Clearing
Corporation; Notice of Filing of Proposed Rule Change To Enhance the
Reconfirmation and Pricing Service, Including the Creation of the
Obligation Warehouse

October 18, 2010.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder \2\ notice is hereby given that
on October 5, 2010, the National Securities Clearing Corporation
(``NSCC'') 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 primarily by NSCC.\3\ The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ The text of the proposed rule change is attached as Exhibit
5 to NSCC's filing and is available at http://www.dtcc.com/
downloads/legal/rule_filings/2010/nscc/2010-11.pdf.
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I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change

    The purpose of this proposed rule change is to enhance the
Reconfirmation and Pricing Service (``RECAPS'') process,

to modify RECAPS to run on a more frequent basis, and to rename RECAPS
as the Obligation Warehouse (``OW'') service.

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

    In its filing with the Commission, NSCC 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. NSCC has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of these
statements.\4\
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    \4\ The Commission has modified the text of the summaries
prepared by NSCC.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

Background
    RECAPS is NSCC's automated fail clearance system for eligible
securities. Through RECAPS, members are provided with an opportunity on
a quarterly basis to reconfirm and reprice compared transactions which
remain unsettled (i.e., fail transactions). The rule change proposes to
modify RECAPS to run on a more frequent basis, enhance the RECAPS
process, and rename the RECAPS process the Obligation Warehouse (``OW''
or ``OW Service''). As more fully described below, the proposed
enhanced service will provide: (1) Comparison of transactions that are
not otherwise submitted by the applicable marketplaces or members
themselves for trade comparison or recording through other NSCC trade
capture services; (2) tracking, storage, and maintenance of unsettled
obligations either compared through the service or forwarded to it from
other NSCC services in accordance with NSCC rules (including securities
exited from NSCC's Continuous Net Settlement (``CNS'') system, non-CNS
Automated Customer Account Transfer Service (``ACATS'') items,\5\ NSCC
Balance Order transactions and Special Trades) (collectively ``OW
Obligations''); \6\ and (3) repricing and netting of fail obligations.
The tracking, storage, and maintenance functionality of the OW will
provide transparency, will make information available to its users
while serving as a central depository of open (i.e., failed or
unsettled) broker-to-broker obligations, and will allow users to manage
and to resolve exceptions (e.g., ``don't know'' or ``DK'' obligations)
in an efficient and timely manner. As proposed, OW will simultaneously
provide on-going maintenance and servicing of open OW Obligations, such
as adjustments for corporate actions and regular scans of OW
Obligations for CNS eligibility.\7\
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    \5\ Only non-CNS eligible ACATS items and CNS-eligible ACATS
items that have been designated as ex-CNS shall be forwarded to the
OW. Non-CNS ACATS items for mutual funds, limited partnerships, and
safekeeping items, however, will not be eligible for OW.
    \6\ Balance Orders will be forwarded to the OW after netting and
allotting has occurred in accordance with NSCC's Procedures.
    \7\ These functionalities will be made available at a date no
less than ten business days following announcement of implementation
by Important Notice.
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Current RECAPS Service
    RECAPS allows members to periodically reconfirm open, aged fails
(i.e., fails that are five days or older), reprice such fails to the
current market value, and when possible, net the reconfirmed and
repriced fails. All NSCC members that are also members of the Financial
Industry Regulatory Authority (``FINRA'') are required to participate
in the RECAPS service; \8\ however, the service is available to all
members. As part of the RECAPS process, those CNS-eligible recompared
fails are forwarded to CNS for processing and settlement. Transactions
in non-CNS eligible issues are repriced, netted, and allotted, when
applicable, and Balance Orders generated for them or they are
designated to settle trade-for-trade.
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    \8\ FINRA Rule 11190(a).
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    RECAPS provides reject and DK capabilities for advisories received
and requires members to effectively respond to all open fails submitted
by a contraparty through a batch overnight submission. Advisories that
are either ``unresponded to'' or ``DK'd'' are subject to close-out
action under the rules of the appropriate marketplace. RECAPS provides
for a one-day settlement capability for all compared fails.
    Currently, the RECAPS processing procedures are as follows:
    1. On a Friday evening at the time and in the manner established by
NSCC, members submit RECAPS fail information (``RECAPS Input'').
    2. On the following Monday morning, NSCC produces RECAPS Contracts
indicating compared, uncompared, and advisory items. Members: (i) Must
respond to all advisories that they receive as a result of the initial
fail submission (either by submitting an advisory, a ``DK,'' or a
reject) and (ii) may submit an ``as-of'' trade if the member failed to
timely submit a transaction to RECAPS. As-of trades are compared only
if there is an exact match, and no trade resolution process is
available. NSCC produces supplemental RECAPS Contracts showing items
compared on Monday's input and CNS and non-CNS Compared Trade Summaries
for those items that compared as a result of Monday's submission.
    3. Fails that compared on the Friday submission will settle on
Monday. Fails that compared on the Monday submission will settle on
Tuesday.
    4. A RECAPS Activity Report is made available to members at the end
of the RECAPS cycle.
    5. The net cash adjustment (the difference between the aggregate
value of the original fails and the aggregate value of the reconfirmed
trades) will settle the day the underlying RECAPS Contract settles and
is included as part of the member's daily money settlement with NSCC.
    6. Because RECAPS is not a guaranteed service of NSCC, if NSCC does
not receive payment from a member, NSCC may, in its discretion, reverse
in whole or part any credit previously given to a member that is the
contra side to a trade reconfirmed and repriced through RECAPS.
Obligation Warehouse
    Currently, many of the transactions submitted to RECAPS by members
are subject to noncentralized, manual processes for purposes of
comparison of fail details and fail confirmation. Under this proposed
rule change, NSCC proposes to enhance and rename the RECAPS service as
the OW to which members may submit and may subsequently maintain and
manage their unsettled transactions. As part of these enhancements,
NSCC proposes to provide a trade matching and confirmation process
pursuant to which members may submit to NSCC information on certain
obligations that are not otherwise submitted to NSCC by the applicable
marketplaces or members themselves through NSCC's other trade
comparison or recording services.\9\

Comparison of transactions submitted through the OW will occur in real-
time. Obligations will be tracked and maintained within the OW and will
be made available for RECAPS processing (as described below) until
settled or otherwise cancelled. In addition, transactions exited from
CNS, non-CNS-eligible ACATS items, and Balance Orders, and Special
Trades will also be forwarded to the OW for storage and maintenance and
RECAPS processing.\10\ Compared items stored in the OW (whether
compared by the OW or forwarded to it from other NSCC services or
systems) will be referred to as ``OW Obligations.'' As more fully
described below, in order to further reduce manual processing by
members, NSCC may automatically adjust any OW Obligations for certain
mandatory reorganization events, which will initially be limited to
adjustments for forward splits, name changes, redemptions, mergers
(both cash and stock), and full calls with respect to bonds.\11\
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    \9\ See Procedure II (Trade Comparison and Recording Service)
which sets forth the procedures for comparison of direct submissions
by members and trade recording of locked-in transactions. In
accordance with Municipal Securities Rulemaking Board (``MSRB'')
rules, NSCC reports transactions in municipal securities compared
through its Real-time Trade Matching (``RTTM'') service to the MSRB
on behalf of members; however, transactions submitted through the OW
will not be reported to the MSRB. In order to remain compliant with
MSRB reporting requirements, members will have to continue to make
submissions subject to MSRB rules through RTTM.
    \10\ Such items will be subject to the validation criteria of
the systems/services that forwarded them to the OW; therefore, the
matching/validation criteria (which are set forth in footnote 9
below) will not apply.
    \11\ Adjustments for mandatory reorganization events are
expected to be available shortly after February 4, 2011, or a date
no less than 10 business days following announcement of its
implementation by Important Notice.
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    The proposed OW Service will forward to CNS on a daily basis (or
such other time frame as NSCC determines from time to time) OW
Obligations in CNS-eligible securities.\12\ However, the OW will not be
a guaranteed service, and an obligation forwarded to CNS will only be
guaranteed to the extent that the member meets its settlement
obligation on the date the item is originally scheduled to settle in
CNS. Transactions eligible for submission will have to have a valid
CUSIP or ISIN and be denominated in U.S. Dollars or such other
currencies as NSCC may designate from time to time. NSCC may determine
from time to time and shall announce by Important Notice which items
are eligible for submission to OW. Initially, government, mortgage-
backed, and foreign securities will all specifically not be eligible.
Further, cash trades will be processed by OW only after settlement
failure of these trades.
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    \12\ This functionality is anticipated to be rolled out in early
March 2011.
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OW Comparison and Trade Resolution Procedures
    As proposed, once a party enters the required transaction
information,\13\ the contraparty will receive an advisory to which it
must respond by submitting identical transaction details to facilitate
a compared obligation or by submitting a DK.\14\ If a member does not
act on an advisory submitted against it by the close of business on the
day after submission, NSCC may impose a fee upon the member. If the
deliverer and receiver submit trade data that matches in all required
respects, the trade will be deemed compared.\15\ NSCC may permit
uncompared trade details to be modified or cancelled by the submitter
on the submission date through the use of the appropriate
instruction.\16\ Upon comparison, NSCC may permit obligations to be
cancelled if both receiver and deliverer agree by submitting a cancel
request or if one party accepts the other party's cancel request. Each
OW Obligation will receive an ``OW Control Number'' to facilitate
tracking the obligation through its settlement, cancellation, or
closure.
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    \13\ Data required for a valid submission will include security
identification, quantity to which party is deliverer or receiver,
contra-broker, deliverer's final money, settlement date, market
participation identification (MPID) (if applicable), Member's unique
reference number (``x-ref''), whether a transaction should be
excluded from CNS processing and other identifying details as NSCC
may require or permit.
    \14\ Obligations will be able to be submitted to the OW in real-
time. Required matching criteria will include the specific criteria
listed in the immediately preceding footnote (except for the x-ref),
and other identifying details as NSCC may require or permit. Any
submission of a DK must include the applicable reason code
pertaining to the Member's disagreement with the transaction.
    \15\ If the deliverer and receiver submit trade data that
matches in all required respects, the trade will be deemed compared
if it meets an initial money tolerance of $5 per million. The amount
of the money tolerance may change from time to time following the
filing of a proposed rule change by NSCC.
    \16\ Modification of transaction details will result in the
cancellation of the existing entry and the opening of a new
submission. Transaction details that have been DK'd by a contraparty
will be deleted from processing in accordance with time frames
specified by NSCC from time to time. Initially, such transaction
details will be deleted on the fifth business day following
submission of the DK by the contraparty.
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    NSCC will have no responsibility for determining whether any trade
submission is duplicative of an earlier trade submission, and any such
input will be treated as a separate submission. NSCC may delete trade
input which is not matched by such time frames as it determines from
time to time.
Maintenance and Tracking
    The proposed OW service will permit members to track each OW
Obligation for the life of the obligation until it has been (i)
Settled, (ii) cancelled by members party to the obligation, or (iii)
otherwise closed in the OW Service by NSCC pursuant to NSCC Rules
(e.g., when the obligation becomes CNS-eligible and is sent to CNS for
settlement).
    NSCC may adjust any compared OW Obligation with respect to certain
mandatory reorganization events, which will initially be limited to
forward splits, name changes, redemptions, mergers (both cash and
stock), and full calls with respect to bonds. In the case of such a
mandatory reorganization, at such time on or after the effective date
of the reorganization as NSCC shall determine and to the extent NSCC
has the relevant information, the affected OW Obligation may be
adjusted in accordance with the terms of the reorganization event. With
respect to name changes and forward splits, OW positions in the subject
security will be converted into the equivalent positions of the new
securities and/or cash, and a new obligation will be created
automatically as part of the processing in the OW. Any cash component
associated with a mandatory reorganization will be included as part of
the member's daily money settlement with NSCC.\17\
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    \17\ In the event that NSCC ceases to act for a member pursuant
to Rule 18, NSCC will reverse credits and debits relating to such a
cash adjustment.
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    Unless otherwise excluded by a member, all CNS-eligible OW
Obligations that reach the status of settlement date minus one (``SD-
1'') or that have reached or passed their scheduled settlement date,
may be forwarded to CNS by NSCC on a daily basis.\18\ However, the
settlement of any such item forwarded to CNS will be guaranteed only to
the extent that the member pays its full settlement obligation on the
date the item is scheduled to settle in CNS. An item forwarded to CNS
from the OW may be exited from the CNS Accounting Operation to the
extent the member fails to complete its settlement obligation. If NSCC
exits an item, any credits received by a member arising from the
corresponding payment obligation shall be reversed, and settlement of
the item shall be effected between the receiving and delivering member
outside the facilities of NSCC.
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    \18\ This functionality is expected to be rolled out by March
2011 or on a date no less than 10 business days following
announcement of its implementation by Important Notice.
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    OW Obligations for which deliveries are made through The Depository
Trust Company (``DTC'') through either The New York Window (``NYW'') or
electronic book-entry deliver order that include the OW Control Number
will be updated to indicate that they have settled in accordance with
proper instructions from DTC or the member,

respectively. In order to give effect to such an update, members must
provide DTC with instructions in accordance with DTC's procedures and
must include the OW Control Number. In the event of a partial delivery
through DTC, NSCC will update the records for the respective OW
Obligation accordingly based on information received either from DTC or
the member's update to their own OW Obligation records. Other items
will be recorded as settled upon the submission of appropriate
instructions by the counterparties. Obligations that have been
reflected in the OW as settled may be reopened (either partially or
fully) as a result of a delivery reclaim message sent by either party
to the obligation to OW. Updates to reflect reclaims of settled
transactions will be made once one party enters details of the original
transaction and the original transaction's OW Control Number.\19\ Once
these details are submitted, an advisory of the reclaim will be sent to
the contraparty that must then submit either identical transaction
details to facilitate the reclaim and reopening of the obligation in OW
or notification that it does not accept the reclaim details entered by
the initiating party. Updates for reclaims may only be submitted to the
OW for a period of two business days following the actual settlement
date of the relevant obligation. If the reclaim message is not accepted
by the contraparty, it will be deleted from the OW, and the parties
will need to generate a new reclaim message in OW. If the original
obligation has been settled for longer than two business days, any
reclaim message will be rejected.
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    \19\ Transaction details required will be identical to those
required when comparing an obligation, set out in note 9 above.
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    Under the proposal, if NSCC ceases to act for a member, all open
activity relating to that member will be deleted from the OW. However,
the reports relating to such activity will be maintained in accordance
with NSCC's record retention requirements.
Modified RECAPS Process
    As proposed, the existing RECAPS process will continue to function
in a modified form.\20\ NSCC proposes that upon implementation of OW,
the RECAPS process will be incorporated into OW and will require one
day to complete. It is anticipated that the process will occur more
frequently than the current quarterly schedule.\21\
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    \20\ It is expected that the first RECAPS process in the OW will
run in late March or early April 2011.
    \21\ Upon implementation of the changes described herein, NSCC
anticipates operating the RECAPS process on a monthly cycle. Members
will be notified of changes in the processing cycle, if any, by an
NSCC Important Notice.
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    On a day specified by NSCC, each OW Obligation eligible for RECAPS
\22\ will be re-priced, if appropriate,\23\ renetted and allotted, if
appropriate, the settlement date will be updated to the next business
date, and a new OW Obligation will be opened. Securities that are not
CNS-eligible or are designated as trade-for-trade will not be netted
and allotted. Obligations eligible for RECAPS in the OW can be excluded
from the RECAPS process if so designated by the member.
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    \22\ Obligations that are matched and have a settlement date of
at least two days prior to the date on which the RECAPS process
commences will be considered for inclusion in the RECAPS process,
and therefore, fail items not already in the OW and eligible for
RECAPS processing must be submitted by the Member prior to RECAPS
processing.
    \23\ In the event that the current market price for a security
is not available, the obligation will be priced at the amount at
which the obligation was previously matched.
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    All new obligations arising from the RECAPS process will be tracked
and processed in accordance with the OW procedures described above. If
a fail was open over an interest payment date, the parties to the trade
will be required to settle that interest payment outside of the OW. Any
net cash adjustments resulting from the RECAPS process will be sent to
NSCC Settlement as they are under the current process.
Reporting
    The rule change proposes that each member will receive real-time
updates regarding its OW activity. In addition, NSCC proposes to make
available to each member an end-of-day report that reflects all end-of-
day positions of such member in OW, which may be accessed by members
through NSCC's systems. Accordingly, NSCC will discontinue issuance of
all RECAPS reports (e.g., RECAPS Contracts/Supplemental Contracts and
RECAPS Compared Trade Summaries).
Proposed Rule Changes
    The rule change also proposes that NSCC will create a new Rule 51
(Obligation Warehouse) and Procedure IIA (Obligation Warehouse) to
reflect the changes and enhancements as described above. Rule 51 would
provide: (i) A general description of the OW service, (ii) a provision
relating to the settlement of OW Obligations and the non-guaranteed
nature of the service, and (iii) a limitation of liability on the part
of NSCC with respect to obligations processed through the OW.
Furthermore, the provisions of Procedure IIA will supersede those set
forth in Procedure II, Section F (RECAPS) and thus Section F will be
deleted.
    In addition, NSCC proposes to make conforming changes to:
    a. Rule 1 (Definitions) to add a definition for ``Obligation
Warehouse'' and ``OW Obligation'';
    b. Rule 7 (Comparison and Trade Recording Operation) to remove
language from the rule relating to submission of data to NSCC for
reconfirmation and repricing of trade data with respect to transactions
already compared through the facilities of NSCC or other facilities, as
this service will now occur pursuant to Rule 51 and Procedure XVII;
    c. Rule 11 (CNS System) to provide that obligations arising from
Special Trades will be automatically entered into the OW;
    d. Rule 18 (Procedures for When NSCC Ceases to Act) to reflect that
(i) the OW Obligations that have been forwarded to CNS for settlement
relating to a member for which NSCC has ceased to act will be removed
from the CNS Accounting Operation and that any outstanding OW
Obligations of the member will be removed from the OW service and (ii)
NSCC will reverse any cash adjustments that were forwarded to
settlement relating to the OW activity of a member for which NSCC has
ceased to act;
    e. Rule 50 (Automated Customer Account Transfer Service) to reflect
that non-CNS ACATS items (as well as CNS-eligible items designated to
be delivered ex-CNS) will be automatically entered into the OW;
    e. Procedure V (Balance Order Accounting Operation) to reflect that
Balance Orders will be automatically entered into the OW; and
    f. Procedure VII (CNS Accounting Operation) to reflect (i) the
addition of CNS-eligible OW activity to the CNS Miscellaneous Activity
Report and (ii) securities removed from CNS that result in a CNS
Receive and Deliver Instructions will be entered into the Obligation
Warehouse service.
Pilot and Participant Testing
    NSCC implemented a pilot program of the OW process in early
February 2010 for firms that had completed systems changes necessary to
participate in the process. This pilot program ended at the beginning
of June 2010, as additional discussions ensued between NSCC and its
participant members regarding the additional functionalities sought to
be included within the service, which are described in this filing.
Prior to implementation of OW, NSCC proposes that a participant testing
period will

take place between November 2010 and January 2011. An industry-wide
test of the OW RECAPS process would be scheduled for March 11, 2011.
Implementation Timeframe
    NSCC proposes to implement the changes set forth in this filing for
all members during the first quarter of 2011 with the first settlement
date expected to be on January 24, 2011. Mandatory reorganization
events are anticipated to be applied to OW Obligations shortly after
February 4, 2011, on a date no less than 10 business days following
announcement of its implementation by Important Notice. Similarly, at
the request of the industry, the functionality providing for OW
Obligations in CNS-eligible securities to be reviewed and sent to CNS
will be implemented several weeks after the initial launch to give
members time to familiarize themselves with the OW settlement tracking
functionality. Accordingly, after March 4, 2011, or on a date no less
than 10 business days following announcement of its implementation by
Important Notice obligations in the OW will be reviewed for CNS-
eligibility and if eligible, will be closed and sent to CNS. The first
RECAPS process in the OW will be run in late March or early April 2011.
Pending Commission approval, members will be advised of the
implementation dates through issuance of NSCC's Important Notices.
    The proposed rule change is consistent with the requirements of the
Securities Exchange Act of 1934, as amended (``Act'') and the rules and
regulations thereunder applicable to NSCC because it facilitates the
prompt and accurate clearance and settlement of securities transactions
by providing for greater efficiency and transparency with respect to
securities transaction obligations processed through the OW. In
addition, the proposal is consistent with the CPSS/IOSCO
Recommendations for Central Counterparties in that it facilitates the
prompt and automated confirmation and comparison of trades, and the
tracking of fail transactions by the parties thereto through
settlement.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    NSCC does not believe that the proposed rule change would impose
any burden on competition.

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

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

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

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

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml) or
     Send an e-mail to<EMAIL_ADDRESS>Please include
File Number SR-NSCC-2010-11 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-NSCC-2010-11. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/
sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Section, 100 F Street,
NE., Washington, DC 20549-1090, on official business days between the
hours of 10 a.m. and 3 p.m. Copies of such filings will also be
available for inspection and copying at the principal office of NSCC
and on NSCC's Web site at http://www.dtcc.com/downloads/legal/rule_
filings/2010/nscc/2010-11.pdf. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-NSCC-2010-11 and should be submitted on or before
November 15, 2010.

    For the Commission by the Division of Trading and Markets,
pursuant to delegated authority.\24\
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    \24\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-26805 Filed 10-22-10; 8:45 am]
BILLING CODE P


[Federal Register Volume 85, Number 61 (Monday, March 30, 2020)]
[Rules and Regulations]
[Pages 17473-17478]
[FR Doc No: 2020-06505]

========================================================================
Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents.

========================================================================

Federal Register / Vol. 85, No. 61 / Monday, March 30, 2020 / Rules
and Regulations

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2019-0726; Product Identifier 2019-NM-102-AD; Amendment
39-19857; AD 2020-04-20]
RIN 2120-AA64

Airworthiness Directives; De Havilland Aircraft of Canada Limited
(Type Certificate Previously Held by Bombardier, Inc.) Airplanes

AGENCY: Federal Aviation Administration (FAA), Department of
Transportation (DOT).

ACTION: Final rule.

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SUMMARY: The FAA is adopting a new airworthiness directive (AD) for
certain De Havilland Aircraft of Canada Limited Model DHC-8-400 series
airplanes. This AD was prompted by reports of wear on fuel couplings,
bonding springs, and sleeves as well as fuel tube end ferrules and fuel
component end ferrules. This AD requires repetitive inspections of
certain parts for discrepancies that meet specified criteria, and
replacement as necessary; repetitive inspections of certain parts for
damage and wear, and rework of parts; and electrical bonding checks of
certain couplings. This AD also requires revising the existing
maintenance or inspection program, as applicable, to incorporate new or
more restrictive airworthiness limitations. For certain airplanes, this
AD allows a modification that would terminate the repetitive
inspections. The FAA is issuing this AD to address the unsafe condition
on these products.

DATES: This AD is effective May 4, 2020.
    The Director of the Federal Register approved the incorporation by
reference of certain publications listed in this AD as of May 4, 2020.

ADDRESSES: For service information identified in this final rule,
contact De Havilland Aircraft of Canada Limited, Q-Series Technical
Help Desk, 123 Garratt Boulevard, Toronto, Ontario M3K 1Y5, Canada;
telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>; email<EMAIL_ADDRESS>
internet https://dehavilland.com. You may view this service information
at the FAA, Transport Standards Branch, 2200 South 216th St., Des
Moines, WA. For information on the availability of this material at the
FAA, call<PHONE_NUMBER>. It is also available on the internet at https://www.regulations.gov by searching for and locating Docket No. FAA-2019-
0726.

Examining the AD Docket

    You may examine the AD docket on the internet at https://www.regulations.gov by searching for and locating Docket No. FAA-2019-
0726; or in person at Docket Operations between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays. The AD docket contains
this final rule, the regulatory evaluation, any comments received, and
other information. The address for Docket Operations is U.S. Department
of Transportation, Docket Operations, M-30, West Building Ground Floor,
Room W12-140, 1200 New Jersey Avenue SE, Washington, DC 20590.

FOR FURTHER INFORMATION CONTACT: Joseph Catanzaro, Aerospace Engineer,
Airframe and Propulsion Section, FAA, New York ACO Branch, 1600 Stewart
Avenue, Suite 410, Westbury, NY 11590; telephone<PHONE_NUMBER>; fax 516-
794-5531; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Discussion

    Transport Canada Civil Aviation (TCCA), which is the aviation
authority for Canada, has issued Canadian AD CF-2017-04R2, dated
September 25, 2018 (also referred to as the Mandatory Continuing
Airworthiness Information, or ``the MCAI''), to correct an unsafe
condition for certain De Havilland Aircraft of Canada Limited Model
DHC-8-400 series airplanes. You may examine the MCAI in the AD docket
on the internet at https://www.regulations.gov by searching for and
locating Docket No. FAA-2019-0726.
    The FAA issued a notice of proposed rulemaking (NPRM) to amend 14
CFR part 39 by adding an AD that would apply to certain De Havilland
Aircraft of Canada Limited Model DHC-8-400 series airplanes. The NPRM
published in the Federal Register on October 30, 2019 (84 FR 58066).
The NPRM was prompted by reports of wear on fuel couplings, bonding
springs, and sleeves as well as fuel tube end ferrules and fuel
component end ferrules. The NPRM proposed to require repetitive
inspections of certain parts for discrepancies that meet specified
criteria, and replacement as necessary; repetitive inspections of
certain parts for damage and wear, and rework of parts; and electrical
bonding checks of certain couplings. The NPRM also proposed to require
revising the existing maintenance or inspection program, as applicable,
to incorporate new or more restrictive airworthiness limitations. For
certain airplanes, the NPRM proposed to allow a modification that would
terminate the repetitive inspections. The FAA is issuing this AD to
address wear on fuel couplings, bonding springs, and sleeves as well as
fuel tube end ferrules and fuel component end ferrules, which could
reduce the integrity of the electrical bonding paths through the fuel
line and components, and ultimately lead to fuel tank ignition in the
event of a lightning strike. See the MCAI for additional background
information.

Comments

    The FAA gave the public the opportunity to participate in
developing this final rule. The following presents the comment received
on the NPRM and the FAA's response to the comment.

Request To Refer to Different Temporary Revisions (TRs)

    Horizon Air requested that paragraph (k) of the proposed AD be
revised to refer to TR ALI-0192 and TR ALI-0193. The commenter
suggested that the proposed AD contains typographical errors in
referring to TR ALI-00AS and TR ALI-00AT.
    The FAA agrees to clarify. Paragraph (k) of the proposed AD
requires incorporating ``the information specified in Q400 Dash 8
(Bombardier) Temporary Revision ALI-00AS, dated April 24, 2018; and
Q400 Dash 8 (Bombardier) Temporary Revision ALI-00AT, dated April 24,
2018.'' TCCA notified the FAA that TR ALI-00AS and TR ALI-00AT are
temporary

placeholder identifiers for TR ALI-0192 and TR ALI-0193. These
temporary placeholder identifiers are used until the finalized TRs are
provided new numerical identifiers. The FAA has confirmed that the
information specified in these TRs is the same as the information
specified in the TRs mentioned by the commenter. For these reasons,
this AD has been revised to specify TR ALI-0192 and TR ALI-0193.

Explanation of Change to Introductory Text to Paragraph (h) of This AD

    We have revised the introductory text to paragraph (h) of this AD
to clarify that the actions apply to the same airplanes as those
identified in the introductory text to paragraph (g) of this AD.

Conclusion

    The FAA reviewed the relevant data, considered the comment
received, and determined that air safety and the public interest
require adopting this final rule with the changes described previously
and minor editorial changes. The FAA has determined that these minor
changes:
     Are consistent with the intent that was proposed in the
NPRM for addressing the unsafe condition; and
     Do not add any additional burden upon the public than was
already proposed in the NPRM.
    The FAA also determined that these changes will not increase the
economic burden on any operator or increase the scope of this final
rule.

Related Service Information Under 1 CFR Part 51

    Bombardier has issued Service Bulletin 84-28-20, Revision D, dated
November 23, 2018. This service information describes procedures for
repetitive detailed inspections of the clamshell coupling bonding
wires, fuel couplings, and associated sleeves for discrepancies (wear
and damage, including discoloration, worn coating, scuffing and
grooves) that meet specified criteria, and replacement. This service
information also describes procedures for repetitive detailed
inspections for damage and wear of the fuel tube end ferrules, fuel
component end ferrules, and ferrule O-ring flanges, and rework of
parts.
    Bombardier has also issued Service Bulletin 84-28-21, Revision C,
dated July 13, 2018. This service information describes procedures for
a detailed inspection for damage and wear of the fuel tube end
ferrules, fuel component end ferrules, and ferrule O-ring flanges;
rework (repair, replacement, or blending, as applicable) of parts; and
a retrofit (structural rework) of the fuel couplings, isolators, and
structural provisions.
    Bombardier has also issued Service Bulletin 84-28-26, Revision A,
dated November 29, 2018. This service information describes procedures
for electrical bonding checks of all threaded couplings on the inboard
vent lines in the left and right wings.
    Bombardier has also issued Q400 Dash 8 (Bombardier) Temporary
Revision ALI-0192, dated April 24, 2018; and Q400 Dash 8 (Bombardier)
Temporary Revision ALI-0193, dated April 24, 2018. This service
information describes airworthiness limitations for fuel tank systems.
These documents are distinct since they describe different
airworthiness limitations.
    This service information is reasonably available because the
interested parties have access to it through their normal course of
business or by the means identified in the ADDRESSES section.

Costs of Compliance

    The FAA estimates that this AD affects 52 airplanes of U.S.
registry. The FAA estimates the following costs to comply with this AD:

                                     Estimated Costs for Required Actions *
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per       Cost on U.S.
                          Labor cost                              Parts cost        product         operators
----------------------------------------------------------------------------------------------------------------
268 work-hours x $85 per hour = $22,780......................              $0          $22,780       $1,184,560
----------------------------------------------------------------------------------------------------------------
* Table does not include estimated costs for revising the maintenance or inspection program.

    The FAA has determined that revising the maintenance or inspection
program takes an average of 90 work-hours per operator, although this
number may vary from operator to operator. In the past, the FAA has
estimated that this action takes 1 work-hour per airplane. Since
operators incorporate maintenance or inspection program changes for
their affected fleet(s), the FAA has determined that a per-operator
estimate is more accurate than a per-airplane estimate. Therefore, the
FAA estimates the total cost per operator to be $7,650 (90 work-hours x
$85 per work-hour).

                                      Estimated Costs for Optional Actions
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per
                                  Labor cost                                       Parts cost        product
----------------------------------------------------------------------------------------------------------------
525 work-hours x $85 per hour = $44,625.......................................         $20,906          $65,531
----------------------------------------------------------------------------------------------------------------

    The FAA estimates the following costs to do any necessary on-
condition actions that would be required based on the results of any
required or optional actions. The FAA has no way of determining the
number of aircraft that might need these on-condition actions:

                                     Estimated Costs of On-Condition Actions
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per
                                  Labor cost                                       Parts cost        product
----------------------------------------------------------------------------------------------------------------
174 work-hours x $85 per hour = $14,790.......................................         $16,767          $31,557
----------------------------------------------------------------------------------------------------------------

Authority for This Rulemaking

    Title 49 of the United States Code specifies the FAA's authority to
issue rules on aviation safety. 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.
    The FAA is issuing this rulemaking under the authority described in
Subtitle VII, Part A, Subpart III, Section 44701: ``General
requirements.'' Under that section, Congress charges the FAA with
promoting safe flight of civil aircraft in air commerce by prescribing
regulations for practices, methods, and procedures the Administrator
finds necessary for safety in air commerce. This regulation is within
the scope of that authority because it addresses an unsafe condition
that is likely to exist or develop on products identified in this
rulemaking action.

Regulatory Findings

    This AD will not have federalism implications under Executive Order
13132. This AD will not have a substantial direct effect on the States,
on the relationship between the national government and the States, or
on the distribution of power and responsibilities among the various
levels of government.
    For the reasons discussed above, I certify that this AD:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866,
    (2) Will not affect intrastate aviation in Alaska, and
    (3) Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 39

    Air transportation, Aircraft, Aviation safety, Incorporation by
reference, Safety.

Adoption of the Amendment

    Accordingly, under the authority delegated to me by the
Administrator, the FAA amends 14 CFR part 39 as follows:

PART 39--AIRWORTHINESS DIRECTIVES

0
1. The authority citation for part 39 continues to read as follows:

    Authority:  49 U.S.C. 106(g), 40113, 44701.

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by adding the following new airworthiness
directive (AD):

2020-04-20 De Havilland Aircraft of Canada Limited (Type Certificate
previously held by Bombardier, Inc.): Amendment 39-19857; Docket No.
FAA-2019-0726; Product Identifier 2019-NM-102-AD.

(a) Effective Date

    This AD is effective May 4, 2020.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to De Havilland Aircraft of Canada Limited Model
DHC-8-400, -401, and -402 airplanes, certificated in any category,
manufacturer serial numbers 4001, 4003, and subsequent.

(d) Subject

    Air Transport Association (ATA) of America Code 28, Fuel.

(e) Reason

    This AD was prompted by reports of wear on fuel couplings,
bonding springs, and sleeves as well as fuel tube end ferrules and
fuel component end ferrules. The FAA is issuing this AD to address
such wear, which could reduce the integrity of the electrical
bonding paths through the fuel line and components, and ultimately
lead to fuel tank ignition in the event of a lightning strike.

(f) Compliance

    Comply with this AD within the compliance times specified,
unless already done.

(g) Initial Inspection Compliance Times

    For airplanes having serial numbers 4001 and 4003 through 4575
inclusive that, as of the effective date of this AD, have not done
the actions specified in Bombardier Service Bulletin 84-28-21: At
the applicable times specified in paragraph (g)(1) or (2) of this
AD, do the actions specified in paragraphs (h)(1) and (2) of this
AD.
    (1) For all airplanes except those identified in paragraph
(g)(2) of this AD: Within 6,000 flight hours or 36 months, whichever
occurs first after the effective date of this AD.
    (2) For airplanes with an original airworthiness certificate or
original export certificate of airworthiness issued on or after the
effective date of this AD: Within 6,000 flight hours or 36 months,
whichever occurs first after the date of issuance of the original
airworthiness certificate or the date of issuance of the original
export certificate of airworthiness.

(h) Repetitive Inspections and Corrective Actions

    For airplanes having serial numbers 4001 and 4003 through 4575
inclusive that, as of the effective date of this AD, have not done
the actions specified in Bombardier Service Bulletin 84-28-21: At
the applicable times specified in paragraph (g)(1) or (2) of this
AD, do the actions specified in paragraphs (h)(1) and (2) of this
AD. Repeat the actions thereafter at intervals not to exceed 6,000
flight hours or 36 months, whichever occurs first.
    (1) Do a detailed inspection of the clamshell coupling bonding
wires, fuel couplings, and associated sleeves for discrepancies that
meet specified criteria, as identified in, and in accordance with
paragraph 3.B., ``Procedure,'' of the Accomplishment Instructions of
Bombardier Service Bulletin 84-28-20, Revision D, dated November 23,
2018. If any conditions are found meeting the criteria specified in
Bombardier Service Bulletin 84-28-20, Revision D, dated November 23,
2018, before further flight, replace affected parts with new
couplings and sleeves of the same part number, in accordance with
paragraph 3.B., ``Procedure,'' of the Accomplishment Instructions of
Bombardier Service Bulletin 84-28-20, Revision D, dated November 23,
2018.
    (2) Do a detailed inspection of the fuel tube end ferrules, fuel
component end ferrules, and ferrule O-ring flanges for damage and
wear, and rework (repair, replace, or blend, as applicable) the
parts, in accordance with paragraph 3.B., ``Procedure,'' of the
Accomplishment Instructions of Bombardier Service Bulletin 84-28-20,
Revision D, dated November 23, 2018.

(i) Optional Terminating Action for Repetitive Inspections

    For airplanes having serial numbers 4001 and 4003 through 4575
inclusive: Doing a detailed inspection of the fuel tube end
ferrules, fuel component end ferrules, and ferrule O-ring flanges
for damage and wear, and reworking (repair, replace, or blend, as
applicable) the parts; and doing a retrofit (structural rework) of
the fuel couplings, isolators, and structural provisions, in
accordance with paragraph 3.B., ``Procedure,'' of the Accomplishment
Instructions of Bombardier Service Bulletin 84-28-21, Revision C,
dated July 13, 2018, terminates the inspections specified in
paragraphs (h)(1) and (2) of this AD.

(j) Electrical Bonding Checks/Detailed Inspection

    For airplanes having serial numbers 4001, 4003 through 4489
inclusive, and 4491 through 4575 inclusive that, as of the effective
date of this AD, have done the actions specified in Bombardier
Service Bulletin 84-28-21, Revision A, dated September 29, 2017; and
airplanes having serial numbers 4576 through 4581 inclusive: Within
6,000 flight hours or 36 months after the effective date of this AD,
whichever occurs first, do the actions specified in paragraph (j)(1)
or (2) of this AD.
    (1) Accomplish electrical bonding checks of all threaded
couplings on the inboard vent lines in the left and right wings, in
accordance with paragraph 3.B., ``Procedure,'' of the Accomplishment
Instructions of Bombardier Service Bulletin 84-28-26, Revision A,
dated November 29, 2018.
    (2) Do a detailed inspection of the fuel tube end ferrules, fuel
component end ferrules, and ferrule O-ring flanges for damage and
wear, and rework (repair, replace, or blend, as applicable) the
parts; and a retrofit (structural rework) of the fuel couplings,
isolators, and structural provisions in accordance with paragraph
3.B., ``Procedure,'' of the Accomplishment

Instructions of Bombardier Service Bulletin 84-28-21, Revision C,
dated July 13, 2018.

(k) Maintenance or Inspection Program Revision

    Within 30 days after the effective date of this AD, revise the
existing maintenance or inspection program, as applicable, to
incorporate the information specified in Q400 Dash 8 (Bombardier)
Temporary Revision ALI-0192, dated April 24, 2018; and Q400 Dash 8
(Bombardier) Temporary Revision ALI-0193, dated April 24, 2018.
Except as specified in paragraph (l) of this AD, the initial
compliance time for doing the tasks in Q400 Dash 8 (Bombardier)
Temporary Revision ALI-0192, dated April 24, 2018, is at the time
specified in Q400 Dash 8 (Bombardier) Temporary Revision ALI-0192,
dated April 24, 2018, or within 30 days after the effective date of
this AD, whichever occurs later.

(l) Initial Compliance Time for Task 284000-419

    The initial compliance time for task 284000-419 is at the time
specified in paragraph (l)(1) or (2) of this AD, as applicable, or
within 30 days after the effective date of this AD, whichever occurs
later.
    (1) For airplanes having serial numbers 4001 and 4003 through
4575, inclusive: Within 18,000 flight hours or 108 months, whichever
occurs first, after the earliest date of embodiment of Bombardier
Service Bulletin 84-28-21 on the airplane.
    (2) For airplanes having serial numbers 4576 and subsequent:
Within 18,000 flight hours or 108 months, whichever occurs first,
from the date of issuance of the original airworthiness certificate
or original export certificate of airworthiness.

(m) No Alternative Actions, Intervals, or Critical Design Configuration
Control Limitations (CDCCLs)

    After the existing maintenance or inspection program has been
revised as required by paragraph (k) of this AD, no alternative
actions (e.g., inspections), intervals, or CDCCLs may be used unless
the actions, intervals, and CDCCLs are approved as an alternative
method of compliance (AMOC) in accordance with the procedures
specified in paragraph (p)(1) of this AD.

(n) No Reporting Requirement

    Although Bombardier Service Bulletin 84-28-20, Revision D, dated
November 23, 2018, specifies to submit certain information to the
manufacturer, this AD does not include that requirement.

(o) Credit for Previous Actions

    (1) This paragraph provides credit for the actions required by
paragraphs (h)(1) and (2) of this AD, if those actions were
performed before the effective date of this AD using the service
information specified in paragraph (o)(1)(i), (ii), or (iii) of this
AD.
    (i) Bombardier Service Bulletin 84-28-20, Revision A, dated
December 14, 2016.
    (ii) Bombardier Service Bulletin 84-28-20, Revision B, dated
February 13, 2017.
    (iii) Bombardier Service Bulletin 84-28-20, Revision C, dated
April 28, 2017.
    (2) For the airplane having serial number 4164, this paragraph
provides credit for the initial inspections required by paragraphs
(h)(1) and (2) of this AD, if those actions were performed before
the effective date of this AD using Bombardier Service Bulletin 84-
28-20, dated September 30, 2016.
    (3) This paragraph provides credit for the actions specified in
paragraph (i) of this AD if those actions were performed before the
effective date of this AD using the service information specified in
paragraph (o)(3)(i), (ii), or (iii) of this AD.
    (i) Bombardier Service Bulletin 84-28-21, dated August 31, 2017.
    (ii) Bombardier Service Bulletin 84-28-21, Revision A, dated
September 29, 2017.
    (iii) Bombardier Service Bulletin 84-28-21, Revision B, dated
June 8, 2018.
    (4) This paragraph provides credit for the actions required by
paragraph (j)(1) of this AD if those actions were performed before
the effective date of this AD using Bombardier Service Bulletin 84-
28-26, dated August 14, 2018.
    (5) This paragraph provides credit for the actions required by
paragraph (j)(2) of this AD if those actions were performed before
the effective date of this AD using Bombardier Service Bulletin 84-
28-21, Revision B, dated June 8, 2018.
    (6) For airplanes having serial numbers 4001, 4003 through 4489
inclusive, and 4491 through 4575 inclusive, and that are post
Bombardier Service Bulletin 84-28-21, Revision A, dated September
29, 2017: This paragraph provides credit for the actions required by
paragraph (j) of this AD if those actions were performed prior to
the effective date of this AD using the service information
specified in paragraph (o)(6)(i) or (ii) of this AD.
    (i) Bombardier Modification Summary Package (ModSum)
IS4Q2800032, dated February 1, 2018.
    (ii) Any airworthiness limitation change request (ACR) specified
in figure 1 to paragraph (o)(6)(ii) of this AD.
BILLING CODE 4910-13-P

[GRAPHIC] [TIFF OMITTED] TR30MR20.000

BILLING CODE 4910-13-C

(p) Other FAA AD Provisions

    The following provisions also apply to this AD:
    (1) Alternative Methods of Compliance (AMOCs): The Manager, New
York ACO Branch, FAA, has the authority to approve AMOCs for this
AD, if requested using the procedures found in 14 CFR 39.19. In
accordance with 14 CFR 39.19, send your request to your principal
inspector or local Flight Standards District Office, as appropriate.
If sending information directly to the manager of the certification
office, send it to ATTN: Program Manager, Continuing Operational
Safety, FAA, New York ACO Branch, 1600 Stewart Avenue, Suite 410,
Westbury, NY 11590; telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>. Before
using any approved AMOC, notify your appropriate principal
inspector, or lacking a principal inspector, the manager of the
local flight standards district office/certificate holding district
office.
    (2) Contacting the Manufacturer: For any requirement in this AD
to obtain instructions from a manufacturer, the instructions must be
accomplished using a method approved by the Manager, New York ACO
Branch, FAA; or Transport Canada Civil Aviation (TCCA); or De
Havilland Aircraft of Canada Limited's TCCA Design Approval
Organization (DAO). If approved by the DAO, the approval must
include the DAO-authorized signature.

(q) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information
(MCAI) Canadian Airworthiness Directive CF-2017-04R2, dated
September 25, 2018, for related information. This MCAI may be found
in the AD docket on the internet at https://www.regulations.gov by
searching for and locating Docket No. FAA-2019-0726.
    (2) For more information about this AD, contact Joseph
Catanzaro, Aerospace Engineer, Airframe and Propulsion Section, FAA,
New York ACO Branch, 1600 Stewart Avenue, Suite 410, Westbury, NY
11590; telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>; email<EMAIL_ADDRESS>    (3) Service information identified in this AD that is not
incorporated by reference is available at the addresses specified in
paragraphs (r)(3) and (4) of this AD.

(r) Material Incorporated by Reference

    (1) The Director of the Federal Register approved the
incorporation by reference (IBR) of the service information listed
in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
    (2) You must use this service information as applicable to do
the actions required by this AD, unless this AD specifies otherwise.
    (i) Bombardier Service Bulletin 84-28-20, Revision D, dated
November 23, 2018.
    (ii) Bombardier Service Bulletin 84-28-21, Revision C, dated
July 13, 2018.
    (iii) Bombardier Service Bulletin 84-28-26, Revision A, dated
November 29, 2018.
    (iv) Bombardier Q400 Dash 8 (Bombardier) Temporary Revision ALI-
0192, dated April 24, 2018.
    (v) Q400 Dash 8 (Bombardier) Temporary Revision ALI-0193, dated
April 24, 2018.
    (3) For service information identified in this AD, contact De
Havilland Aircraft of Canada Limited, Q-Series Technical Help Desk,
123 Garratt Boulevard, Toronto, Ontario M3K 1Y5, Canada; telephone
416-375-4000; fax<PHONE_NUMBER>; email<EMAIL_ADDRESS>internet
https://dehavilland.com.
    (4) You may view this service information at the FAA, Transport
Standards Branch, 2200 South 216th St., Des Moines, WA. For
information on the availability of this material at the FAA, call
206-231-3195.
    (5) You may view this service information that is incorporated
by reference at the National Archives and Records Administration
(NARA). For information on the availability of this material at
NARA, email<EMAIL_ADDRESS>or go to: https://www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued on March 1, 2020.
Lance T. Gant,
Director, Compliance & Airworthiness Division, Aircraft Certification
Service.
[FR Doc. 2020-06505 Filed 3-27-20; 8:45 am]
 BILLING CODE 4910-13-P


[Federal Register: March 31, 2010 (Volume 75, Number 61)]
[Proposed Rules]
[Page 16024-16026]
[DOCID:fr31mr10-19]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2010-0071; Airspace Docket No. 10-AAL-1]
RIN 2120-AA66

Proposed Amendment of Norton Sound Low and Control 1234L Offshore
Airspace Areas; Alaska

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: This action proposes to modify the Norton Sound Low and
Control 1234L Offshore Airspace Areas in Alaska. This action would
lower the airspace floors to provide controlled airspace beyond 12
miles from the coast of the United States given that there is a
requirement to provide Instrument Flight Rules (IFR) en route Air
Traffic Control (ATC) services and within which the United States is
applying domestic ATC procedures.

DATES: Comments must be received on or before May 17, 2010.

ADDRESSES: Send comments on this proposal to the U.S. Department of
Transportation, Docket Operations, M-30, 1200 New Jersey Avenue, SE.,
West Building Ground Floor, Room W12-140, Washington, DC 20590-0001;
telephone:<PHONE_NUMBER>. You must identify FAA Docket No. FAA-2010-
0071 and Airspace Docket No. 10-AAL-1 at the beginning of your
comments. You may also submit comments through the Internet at http://
www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Ken McElroy, Airspace and Rules Group,
Office of System Operations Airspace and AIM, Federal Aviation
Administration, 800 Independence Avenue, SW., Washington, DC 20591;
telephone:<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

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-2010-0071 and Airspace Docket No. 10-AAL-1) 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 http://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-2010-0071 and Airspace Docket No. 10-AAL-1.'' The
postcard will be date/time stamped and returned to the commenter.
    All communications received on or before the specified closing date
for comments 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 closing date
for comments. A report summarizing each substantive public contact with
FAA personnel concerned with this rulemaking will be filed in the
docket.

Availability of NPRMs

    An electronic copy of this document may be downloaded through the
Internet at http://www.regulations.gov. Recently published rulemaking
documents can also be accessed through the FAA's Web page at http://
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
a.m. and 5 p.m., Monday through Friday, except Federal holidays. An
informal docket may also be examined during normal business hours at
the office of the Alaskan Service Center, Operations Support Group,
Federal Aviation Administration, 222 West 7th Avenue, Box 14,
Anchorage, AK 99513.
    Persons interested in being placed on a mailing list for future
NPRMs should contact the FAA's Office of Rulemaking,<PHONE_NUMBER>,
for a copy of Advisory Circular No. 11-2A, Notice of Proposed
Rulemaking Distribution System, which describes the application
procedure.

The Proposal

    The FAA is proposing an amendment to Title 14 Code of Federal
Regulations (14 CFR) part 71 to modify the Norton Sound Low and Control
1234L Offshore Airspace Areas in Alaska.
    The Norton Sound Low Offshore Airspace Area would be modified by
lowering the offshore airspace floor to 1,200 feet mean sea level (MSL)
at the following airports; within 73 miles of Clarks Point, King
Salmon, Kivalina, Kwethluk, Napakiak, Scammon Bay, Shaktooklik, and
Tooksook Bay; within 74 miles of Elim and Manokotak, and within 72.5
miles of Red Dog.
    The Control 1234L Offshore Airspace Area would be modified by
lowering the offshore airspace floor to 1,200 feet above the surface
within 73 miles of Nikolski, and Toksook Bay Airports.
    Offshore airspace areas are published in paragraph 2003 of FAA
Order 7400.9T dated August 27, 2009 and effective September 15, 2009,
which is incorporated by reference in 14 CFR 71.1. The offshore
airspace areas listed in this document will be published subsequently
in the Order.
    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.
Therefore, this proposed regulation: (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.
    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 modifies offshore airspace areas in Alaska.

ICAO Considerations

    As part of this proposal relates to navigable airspace outside the
United States, this notice is submitted in accordance with the
International Civil Aviation Organization (ICAO) International
Standards and Recommended Practices.
    The application of International Standards and Recommended
Practices by the FAA, Office of System Operations Airspace and AIM,
Airspace and Rules Group, in areas outside the United States domestic
airspace, is governed by the Convention on International Civil
Aviation. Specifically, the FAA is governed by Article 12 and Annex 11,
which pertain to the establishment of necessary air navigational
facilities and services to promote the safe, orderly, and expeditious
flow of civil air traffic. The purpose of Article 12 and Annex 11 is to
ensure that civil aircraft operations on international air routes are
performed under uniform conditions.
    The International Standards and Recommended Practices in Annex 11
apply to airspace under the jurisdiction of a contracting state,
derived from ICAO. Annex 11 provisions apply when air traffic services
are provided and a contracting state accepts the responsibility of
providing air traffic services over high seas or in airspace of
undetermined sovereignty. A contracting state accepting this
responsibility may apply the International Standards and Recommended
Practices that are consistent with standards and practices utilized in
its domestic jurisdiction.
    In accordance with Article 3 of the Convention, state-owned
aircraft are exempt from the Standards and Recommended Practices of
Annex 11. The United States is a contracting state to the Convention.
Article 3(d) of the Convention provides that participating state
aircraft will be operated in international airspace with due regard for
the safety of civil aircraft. Since this action involves, in part, the
designation of navigable airspace outside the United States, the
Administrator is consulting with the Secretary of State and the
Secretary of Defense in accordance with the provisions of Executive
Order 10854.

Environmental Review

    This proposal will be subject to an environmental analysis in
accordance with FAA Order 1050.1E, ``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

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

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

Sec.  71.1  [Amended]

    2. The incorporation by reference in 14 CFR 71.1 of FAA Order
7400.9T, Airspace Designations and Reporting Points, signed August 27,
2009, and effective September 15, 2009, is to be amended as follows:

Paragraph 6007 Offshore Airspace Areas.

* * * * *

Norton Sound Low, AK [Amended]

    That airspace extending upward from 14,500 feet MSL within an
area bounded by a line beginning at lat. 56[deg]42[min]59[sec] N.,
long. 160[deg]00[min]00[sec] W., north by a line 12 miles from and
parallel to the U.S. coastline to the intersection with
164[deg]00[min]00[sec] W., longitude near the outlet to Kotzebue
Sound, then north to the intersection with a point 12 miles from the
U.S. coastline, then north by a line 12 miles from and parallel to
the shoreline to lat. 68[deg]00[min]00[sec] N., to lat.
68[deg]00[min]00[sec] N., long. 168[deg]58[min]23[sec] W., to lat.
65[deg]00[min]00[sec] N., long. 168[deg]58[min]23[sec] W., to lat.
62[deg]35[min]00[sec] N., long. 175[deg]00[min]00[sec] W., to lat.
59[deg]59[min]57[sec] N., long. 168[deg]00[min]08[sec] W., to lat.
57[deg]45[min]57[sec] N., long. 161[deg]46[min]08[sec] W., to lat.
58[deg]06[min]57[sec] N., long. 160[deg]00[min]00[sec] W., to the
point of beginning; and that airspace extending upward from 1,200
feet MSL north of the Alaska Peninsula and east of 160[deg] W.
longitude within 73 miles of the Port Heiden NDB/DME, AK, and north
of the Alaska Peninsula and east of 160[deg] W. longitude within an
81.2-mile radius of the Perryville Airport, AK, and north of the
Alaska Peninsula and east of 160[deg] W. longitude within a 72.8-
mile radius of the Chignik Airport, AK, and within a 35-mile radius
of lat. 60[deg]21[min]17[sec] N., long. 165[deg]04[min]01[sec] W.,
and within a 73-mile radius of the Chevak Airport, AK, and within a
73-mile radius of the Clarks Point Airport, AK, and within a 73-mile
radius of the Elim Airport, AK, and within a 45-mile radius of the
Hooper Bay Airport, AK, and within a 73-mile radius of the King
Salmon Airport, AK, and within a 73-mile radius of the Kivalina
Airport, AK, and within a 74-mile radius of the Kotzebue VOR/DME,
AK, and within a 73-mile radius of the Kwethluk Airport, AK, and
within a 74-mile radius of the Manokotak Airport, AK, and within a
73-mile radius of the Napakiak Airport, AK, and within a 77.4-mile
radius of the Nome VORTAC, AK, and within a 71NM radius of the New
Stuyahok Airport, AK, and within a 73-mile radius of the Noatak
Airport, AK, and within a 72.5-mile radius of the Red Dog Airport,
AK, and within a 73-mile radius of the Scammon Bay Airport, AK, and
within a 73-mile radius of the Shaktoolik Airport, AK, and within a
74-mile radius of the Selawik Airport, AK, and within a 73-mile
radius of the St. Michael Airport, AK, and within a 73-mile radius
of the Toksook Bay Airport, AK, and within a 30-mile radius of lat.
66[deg]09[min]58[sec] N., long. 166[deg]30[min]03[sec] W., and
within a 30-mile radius of lat. 66[deg]19[min]55[sec] N., long.
165[deg]40[min]32[sec] W., and that airspace extending upward from
700 feet MSL within 8 miles west and 4 miles east of the 339[deg]
bearing from the Port Heiden NDB/DME, AK, extending from the Port
Heiden NDB/DME, AK, to 20 miles north of the Port Heiden NDB/DME,
AK, and within a 25-mile radius of the Nome Airport, AK.
* * * * *

Control 1234L, AK [Amended]

    That airspace extending upward from 2,000 feet above the surface
within an area bounded by a line beginning at lat.
58[deg]06[min]57[sec] N., long. 160[deg]00[min]00[sec] W., then
south along 160[deg]00[min]00[sec] W. longitude, until it intersects
the Anchorage Air Route Traffic Control Center (ARTCC) boundary;
then southwest, northwest, north, and northeast along the Anchorage
ARTCC boundary to lat. 62[deg]35[min]00[sec] N., long.
175[deg]00[min]00[sec] W., to lat. 59[deg]59[min]57[sec] N., long.
168[deg]00[min]08[sec] W., to lat. 57[deg]45[min]57[sec] N., long.
161[deg]46[min]08[sec] W., to the point of beginning; and that
airspace extending upward from 1,200 feet above the surface within a
26.2-mile radius of Eareckson Air Station, AK, within an 11-mile
radius of Adak Airport, AK, and within 16 miles of Adak Airport, AK,
extending clockwise from the 033[deg] bearing to the 081[deg]
bearing from the Mount Moffett NDB, AK, and within a 10-mile radius
of Atka Airport, AK, and within a 10.6-mile radius from Cold Bay
Airport, AK, and within 9 miles east and 4.3 miles west of the
321[deg] bearing from Cold Bay Airport, AK, extending from the 10.6-
mile radius to 20 miles northwest of Cold Bay Airport, AK, and 4
miles each side of the 070[deg] bearing from Cold Bay Airport, AK,
extending from the 10.6-mile radius to 13.6 miles northeast of Cold
Bay Airport, AK, and within a 26.2-mile radius of Eareckson Air
Station, AK, and west of 160[deg] W. longitude within an 81.2-mile
radius of Perryville Airport, AK, and within a 73-mile radius of the
Nikolski Airport, AK, within a 74-mile radius of the Manokotak
Airport, AK, and within a 73-mile radius of the Clarks Point
Airport, AK and west of 160[deg] W. longitude within a 73-mile
radius of the Port Heiden NDB/DME, AK, and within a 10-mile radius
of St. George Airport, AK, and within a 73-mile radius of St. Paul
Island Airport, AK, and within a 20-mile radius of Unalaska Airport,
AK, extending clockwise from the 305[deg] bearing from the Dutch
Harbor NDB, AK, to the 075[deg] bearing from the Dutch Harbor NDB,
AK, and west of 160[deg] W. longitude within a 25-mile radius of the

Borland NDB/DME, AK, and west of 160[deg] W. longitude within a
72.8-mile radius of Chignik Airport, AK; and that airspace extending
upward from 700 feet above the surface within a 6.9-mile radius of
Eareckson Air Station, AK, and within a 7-mile radius of Adak
Airport, AK, and within 5.2 miles northwest and 4.2 miles southeast
of the 061[deg] bearing from the Mount Moffett NDB, AK, extending
from the 7-mile radius of Adak Airport, AK, to 11.5 miles northeast
of Adak Airport, AK, and within a 6.5-mile radius of King Cove
Airport, and extending 1.2 miles either side of the 103[deg] bearing
from King Cove Airport from the 6.5-mile radius out to 8.8 miles,
and within a 6.4-mile radius of the Atka Airport, AK, and within a
6.3-mile radius of Nelson Lagoon Airport, AK, and within a 6.3-mile
radius of the Nikolski Airport, AK, and within a 6.4-mile radius of
Sand Point Airport, AK, and within 3 miles each side of the 172[deg]
bearing from the Borland NDB/DME, AK, extending from the 6.4-mile
radius of Sand Point Airport, AK, to 13.9 miles south of Sand Point
Airport, AK, and within 5 miles either side of the 318[deg] bearing
from the Borland NDB/DME, AK, extending from the 6.4-mile radius of
Sand Point Airport, AK, to 17 miles northwest of Sand Point Airport,
AK, and within 5 miles either side of the 324[deg] bearing from the
Borland NDB/DME, AK, extending from the 6.4-mile radius of Sand
Point Airport, AK, to 17 miles northwest of the Sand Point Airport,
AK, and within a 6.6-mile radius of St. George Airport, AK, and
within an 8-mile radius of St. Paul Island Airport, AK, and 8 miles
west and 6 miles east of the 360[deg] bearing from St. Paul Island
Airport, AK, to 14 miles north of St. Paul Island Airport, AK, and
within 6 miles west and 8 miles east of the 172[deg] bearing from
St. Paul Island Airport, AK, to 15 miles south of St. Paul Island
Airport, AK, and within a 6.4-mile radius of Unalaska Airport, AK,
and within 2.9 miles each side of the 360[deg] bearing from the
Dutch Harbor NDB, AK, extending from the 6.4-mile radius of Unalaska
Airport, AK, to 9.5 miles north of Unalaska Airport, AK; and that
airspace extending upward from the surface within a 4.6-mile radius
of Cold Bay Airport, AK, and within 1.7 miles each side of the
150[deg] bearing from Cold Bay Airport, AK, extending from the 4.6-
mile radius to 7.7 miles southeast of Cold Bay Airport, AK, and
within 3 miles west and 4 miles east of the 335[deg] bearing from
Cold Bay Airport, AK, extending from the 4.6-mile radius to 12.2
miles northwest of Cold Bay Airport, AK.

    Issued in Washington, DC, on March 24, 2010.
Kelly Neubecker,
Acting Manager, Airspace and Rules Group.
[FR Doc. 2010-7266 Filed 3-30-10; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 82, Number 156 (Tuesday, August 15, 2017)]
[Proposed Rules]
[Pages 38623-38626]
[FR Doc No: 2017-16780]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2017-0776; Product Identifier 2017-NM-062-AD]
RIN 2120-AA64

Airworthiness Directives; The Boeing Company Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: We propose to adopt a new airworthiness directive (AD) for
certain The Boeing Company Model 737-200, -300, -400, and -500 series
airplanes. This proposed AD was prompted by reports of cracks in the
frame web adjacent to the air-conditioning support brackets. This
proposed AD would require an inspection for any air conditioning
bracket assembly or intercostal, and depending on the results,
repetitive inspections for cracking of certain locations and applicable
on-condition actions. We are proposing this AD to address the unsafe
condition on these products.

DATES: We must receive comments on this proposed AD by September 29,
2017.

ADDRESSES: You may send comments, using the procedures found in 14 CFR
11.43 and 11.45, by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE., Washington, DC 20590.
     Hand Delivery: Deliver to Mail address above between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    For service information identified in this NPRM, contact Boeing
Commercial Airplanes, Attention: Contractual & Data Services (C&DS),
2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600;
telephone<PHONE_NUMBER>; Internet https://www.myboeingfleet.com. You may
view this referenced service information at the FAA, Transport
Standards Branch, 1601 Lind Avenue SW., Renton, WA. For information on
the availability of this material at the FAA, call<PHONE_NUMBER>. It is
also available on the Internet at http://www.regulations.gov by
searching for and locating Docket No. FAA-2017-0776.

Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-
0776; or in person at the Docket Management Facility between 9 a.m. and
5 p.m., Monday through Friday, except Federal holidays. The AD docket
contains this NPRM, the regulatory evaluation, any comments received,
and other information. The street address for the Docket Office (phone:
800-647-5527) is in the ADDRESSES section. Comments will be available
in the AD docket shortly after receipt.

FOR FURTHER INFORMATION CONTACT: Alan Pohl, Aerospace Engineer,
Airframe Section, FAA, Seattle ACO Branch, 1601 Lind Avenue SW.,
Renton, WA 98057-3356; phone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; email:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Comments Invited

    We invite you to send any written relevant data, views, or
arguments about this proposal. Send your comments to an address listed
under the ADDRESSES section. Include ``Docket No. FAA-2017-0776;
Product Identifier 2017-NM-062-AD'' at the beginning of your comments.
We specifically invite comments on the overall regulatory, economic,
environmental, and energy aspects of this NPRM. We will consider all
comments received by the closing date and may amend this NPRM because
of those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this proposed AD.

Discussion

    We have received reports indicating that operators have found
cracks in the frame web adjacent to the air-conditioning support
brackets. One crack was found in the outboard fastener hole common to
the stringer tie for stringer S-8R at station (STA) 380 with a crack
size 0.35 inch, at 35,889 total flight cycles. Another crack was found
in the outboard fastener hole common to the stringer tie for stringer
S-8L at STA 907 with a crack size 0.20 inch, at 28,165 total flight
cycles. The frame web cracks are due to fatigue caused by the stringer
tie reacting to frame twisting that is the result of the air-
conditioning bracket binding within the slip joint assembly. This
binding results in out-of-plane (forward-aft) loads being placed onto
the frame and occurs because of thermal expansion of the air
conditioning rail as well as fuselage deflection during flight
transmitting loads into the rail. Such cracks, if not corrected, could
result in a severed frame. A severed frame, in combination with
potential multiple site damage (MSD) at the stringer S-10 lap splice or
chem-mill skin cracks, can result in possible rapid decompression and
loss of structural integrity of the airplane.

Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Alert Service Bulletin 737-53A1363, dated April
7, 2017. The service information describes procedures for an inspection
for any air-conditioning bracket assembly or intercostal, repetitive
inspections for cracking of certain locations, and applicable on-
condition actions. This service information is reasonably available
because the interested parties have access to it through their normal
course of business or by the means identified in the ADDRESSES section.

FAA's Determination

    We are proposing this AD because we evaluated all the relevant
information and determined the unsafe condition described previously is
likely to exist or develop in other products of the same type design.

Proposed AD Requirements

    This proposed AD would require accomplishment of the actions
identified as ``RC'' (required for compliance) in the Accomplishment
Instructions of Boeing Alert Service Bulletin 737-53A1363, dated April
7, 2017, described previously, except for any differences identified as
exceptions in the regulatory text of this proposed AD.
    For information on the procedures and compliance times, see this
service information at http://www.regulations.gov by searching for and
locating Docket No. FAA-2017-0776.

Costs of Compliance

    We estimate that this proposed AD affects 302 airplanes of U.S.
registry. We estimate the following costs to comply with this proposed
AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
            Action                   Labor cost          Parts cost    Cost per product   Cost on U.S. operators
----------------------------------------------------------------------------------------------------------------
Inspections..................  27 work-hours x $85                $0   $2,295 per        $693,090 per inspection
                                per hour = $2,295                       inspection        cycle.
                                per inspection cycle.                   cycle.
----------------------------------------------------------------------------------------------------------------

    We have received no definitive data that would enable us to provide
cost estimates for the on-condition actions specified in this proposed
AD.

Authority for This Rulemaking

    Title 49 of the United States Code specifies the FAA's authority to
issue rules on aviation safety. 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.
    We are issuing this rulemaking under the authority described in
Subtitle VII, Part A, Subpart III, Section 44701: ``General
requirements.'' Under that section, Congress charges the FAA with
promoting safe flight of civil aircraft in air commerce by prescribing
regulations for practices, methods, and procedures the Administrator
finds necessary for safety in air commerce. This regulation is within
the scope of that authority because it addresses an unsafe condition
that is likely to exist or develop on products identified in this
rulemaking action.
    This proposed AD is issued in accordance with authority delegated
by the Executive Director, Aircraft Certification Service, as
authorized by FAA Order 8000.51C. In accordance with that order,
issuance of ADs is normally a function of the Compliance and
Airworthiness Division, but during this transition period, the
Executive Director has delegated the authority to issue ADs applicable
to transport category airplanes to the Director of the System Oversight
Division.

Regulatory Findings

    We determined that this proposed AD would not have federalism
implications under Executive Order 13132. This proposed AD would not
have a substantial direct effect on the States, on the relationship
between the national Government and the States, or on the distribution
of power and responsibilities among the various levels of government.
    For the reasons discussed above, I certify this proposed
regulation:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866,
    (2) Is not a ``significant rule'' under the DOT Regulatory Policies
and Procedures (44 FR 11034, February 26, 1979),
    (3) Will not affect intrastate aviation in Alaska, and
    (4) Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 39

    Air transportation, Aircraft, Aviation safety, Incorporation by
reference, Safety.

The Proposed Amendment

    Accordingly, under the authority delegated to me by the
Administrator, the FAA proposes to amend 14 CFR part 39 as follows:

PART 39--AIRWORTHINESS DIRECTIVES

0
1. The authority citation for part 39 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40113, 44701.

Sec.  39.13   [Amended]

0
2. The FAA amends Sec.  39.13 by adding the following new airworthiness
directive (AD):

The Boeing Company: Docket No. FAA-2017-0776; Product Identifier
2017-NM-062-AD.

(a) Comments Due Date

    We must receive comments by September 29, 2017.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to The Boeing Company Model 737-200, -300, -400,
and -500 series airplanes, certificated in any category, as
identified in Boeing Alert Service Bulletin 737-53A1363, dated April
7, 2017.

(d) Subject

    Air Transport Association (ATA) of America Code 53, Fuselage.

(e) Unsafe Condition

    This AD was prompted by reports of cracks in the frame web
adjacent to the air-conditioning support brackets. We are issuing
this AD to detect and correct cracks in the frame web adjacent to
the air-conditioning support brackets, which could result in a
severed frame, and in combination with potential multiple site
damage (MSD) at the stringer S-10 lap splice or chem-mill skin
cracks, could result in possible rapid decompression and loss of
structural integrity of the airplane.

(f) Compliance

    Comply with this AD within the compliance times specified,
unless already done.

(g) Required Actions

    Except as required by paragraph (h) of this AD: At the
applicable times specified in paragraph 1.E., ``Compliance,'' of
Boeing Alert Service Bulletin 737-53A1363, dated April 7, 2017, do
all applicable actions identified as ``RC'' (required for
compliance) in, and in accordance with, the Accomplishment
Instructions of Boeing Alert Service Bulletin 737-53A1363, dated
April 7, 2017.

(h) Exceptions to Service Information Specifications

    (1) Where Boeing Alert Service Bulletin 737-53A1363, dated April
7, 2017, uses the phrase ``after the original issue date of this
service bulletin,'' for purposes of determining compliance with the
requirements of this AD, the phrase ``after the effective date of
this AD'' applies.
    (2) Where Boeing Alert Service Bulletin 737-53A1363, dated April
7, 2017, specifies contacting Boeing, and specifies that action as
RC: This AD requires using a method approved in accordance with the
procedures specified in paragraph (j) of this AD.

(i) Terminating Action for Repetitive Inspections

    Accomplishment of a reinforcement repair at the stringer tie
location in accordance with a method approved in accordance with the
procedures specified in paragraph (j) of this AD terminates the
repetitive inspections required by paragraph (g) of this AD for the
repaired stringer tie location only, provided the crack is removed
or trimmed out from the stringer tie holes.

(j) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Seattle ACO Branch, FAA, has the authority to
approve AMOCs for this AD, if requested using the procedures found
in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request
to your principal inspector or local Flight Standards District
Office, as appropriate. If sending information directly to the
manager of the certification office, send it to the attention of the
person identified in paragraph (k)(1) of this AD. Information may be
emailed to<EMAIL_ADDRESS>    (2) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the local flight standards district office/certificate holding
district office.
    (3) An AMOC that provides an acceptable level of safety may be
used for any repair, modification, or alteration required by this AD
if it is approved by the Boeing Commercial Airplanes Organization
Designation Authorization (ODA) that has been authorized by the
Manager, Seattle ACO Branch, to make those findings. To be approved,
the repair method, modification deviation, or alteration deviation
must meet the certification basis of the airplane, and the approval
must specifically refer to this AD.
    (4) Except as required by paragraph (h)(2) of this AD: For
service information that contains steps that are labeled as RC, the
provisions of paragraphs (j)(4)(i) and (j)(4)(ii) of this AD apply.
    (i) The steps labeled as RC, including substeps under an RC step
and any figures identified in an RC step, must be done to comply
with the AD. If a step or substep is labeled ``RC Exempt,'' then the
RC requirement is removed from that step or substep. An AMOC is
required for any deviations to RC steps, including substeps and
identified figures.
    (ii) Steps not labeled as RC may be deviated from using accepted
methods in accordance with the operator's maintenance

or inspection program without obtaining approval of an AMOC,
provided the RC steps, including substeps and identified figures,
can still be done as specified, and the airplane can be put back in
an airworthy condition.

(k) Related Information

    (1) For more information about this AD, contact Alan Pohl,
Aerospace Engineer, Airframe Section, FAA, Seattle ACO Branch, 1601
Lind Avenue SW., Renton, WA 98057-3356; phone:<PHONE_NUMBER>; fax:
425-917-6590; email<EMAIL_ADDRESS>    (2) For service information identified in this AD, contact
Boeing Commercial Airplanes, Attention: Contractual & Data Services
(C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-
5600; telephone<PHONE_NUMBER>; Internet https://www.myboeingfleet.com. You may view this referenced service
information at the FAA, Transport Standards Branch, 1601 Lind Avenue
SW., Renton, WA. For information on the availability of this
material at the FAA, call<PHONE_NUMBER>.

    Issued in Renton, Washington, on August 2, 2017.
Jeffrey E. Duven,
Director, System Oversight Division, Aircraft Certification Service.
[FR Doc. 2017-16780 Filed 8-14-17; 8:45 am]
BILLING CODE 4910-13-P