[Federal Register Volume 82, Number 160 (Monday, August 21, 2017)]
[Notices]
[Pages 39636-39639]
[FR Doc No: 2017-17550]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81403; File No. SR-ISE-2017-79]

Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend
Supplementary Material .14 of Rule 504, Entitled ``Series of Options
Contracts Open for Trading''

August 15, 2017.
    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 August 10, 2017, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed
with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the Exchange. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes a proposal to amend Supplementary Material
.14 of Rule 504, entitled ``Series of Options Contracts Open for
Trading.''
    The text of the proposed rule change is set forth below. Proposed
new language is italicized; deleted text is in brackets.
* * * * *

Rule 504. Series of Options Contracts Open for Trading

    (a)-(h) No change.

Supplementary Material to Rule 504

    .01-.13 No change.
    .14 Notwithstanding any other provision regarding the interval of
strike prices of series of options on Exchange-Traded Fund Shares in
this rule, the interval of strike prices on SPDR S&P 500 ETF (``SPY''),
iShares Core S&P 500 ETF (``IVV''), and the SPDR Dow Jones Industrial
Average ETF (``DIA'') options will be $1 or greater.
* * * * *

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

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

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

1. Purpose
    The Exchange proposes to amend Rule 504 by modifying the strike
setting regime for the iShares Core S&P 500 ETF (``IVV'') options.
Specifically, the Exchange proposes to modify the interval setting
regime for IVV options to allow $1 strike price intervals above $200.
    The Exchange believes that the proposed rule change would make IVV
options easier for investors and traders to use and more tailored to
their investment needs. Additionally, the interval setting regime the
Exchange proposes to apply to IVV options is currently applied to
options on units of

the Standard & Poor's Depository Receipts Trust (``SPY''), which is an
exchange-traded fund (``ETF'') that is identical in all material
respects to the IVV ETF.
    The SPY and IVV ETFs are identical in all material respects. The
SPY and IVV ETFs are designed to roughly track the performance of the
S&P 500 Index with the price of SPY and IVV designed to roughly
approximate 1/10th of the price of the S&P 500 Index. Accordingly, SPY
and IVV strike prices--having a multiplier of $100--reflect a value
roughly equal to 1/10th of the value of the S&P 500 Index. For example,
if the S&P 500 Index is at 1972.56, SPY and IVV options might have a
value of approximately 197.26 with a notional value of $19,726. In
general, SPY and IVV options provide retail investors and traders with
the benefit of trading the broad market in a manageably sized contract.
As options with an ETP underlying, SPY and IVV options are listed in
the same manner as equity options under the Rules.
    IVV options currently trade at $5 intervals above a $200 strike
price, whereas IVV options at or below a $200 strike price trade in $1
intervals. Further, pursuant to Supplementary Material .12 of Rule 504,
the Exchange may open for trading Short Term Option Series on the Short
Term Option Opening Date that expire on the Short Term Option
Expiration Date at strike price intervals of (i) $0.50 or greater where
the strike price is less than $100, and $1 or greater where the strike
price is between $100 and $150 for all option classes that participate
in the Short Term Options Series Program; (ii) $0.50 for option classes
that trade in one dollar increments and are in the Short Term Option
Series Program; or (iii) $2.50 or greater where the strike price is
above $150.
    The Exchange's proposal seeks to narrow the strike price intervals
to $1 for IVV options above $200, in effect matching the strike setting
regime for strike intervals in IVV options below $200 and matching the
strike setting regime applied to SPY options. Currently, the S&P 500
Index is above 2000. The S&P 500 Index is widely regarded as the best
single gauge of large cap U.S. equities and is widely quoted as an
indicator of stock prices and investor confidence in the securities
market. As a result, individual investors often use S&P 500 Index-
related products to diversify their portfolios and benefit from market
trends. Accordingly, the Exchange believes that offering a wide range
of S&P 500 Index-based options affords traders and investors important
hedging and trading opportunities. The Exchange believes that not
having the proposed $1 strike price intervals above $200 in IVV
significantly constricts investors' hedging and trading possibilities.
    The Exchange proposes to amend Supplementary Material .14 of Rule
504 to allow IVV options to trade in $1 increments above a strike price
of $200. Specifically, the Exchange proposes to amend Supplementary
Material .14 of Rule 504 to state that the interval between strike
prices of series of options on Units of IVV will be $1 or greater. The
Exchange believes that by having smaller strike intervals in IVV,
investors would have more efficient hedging and trading opportunities
due to the lower $1 interval ascension. The proposed $1 intervals,
particularly above the $200 strike price, will result in having at-the-
money series based upon the underlying IVV moving less than 1%.
    The Exchange believes that the proposed strike setting regime is in
line with the slower movements of broad-based indices. Furthermore, the
proposed $1 intervals would allow option trading strategies (such as,
for example, risk reduction/hedging strategies using IVV weekly
options), to remain viable. Considering the fact that $1 intervals
already exist below the $200 price point and that IVV is above the $200
level, the Exchange believes that continuing to maintain the artificial
$200 level (above which intervals increase 500% to $5), would have a
negative effect on investing, trading and hedging opportunities, and
volume.
    The Exchange believes that the investing, trading, and hedging
opportunities available with IVV options far outweighs any potential
negative impact of allowing IVV options to trade in more finely
tailored intervals above the $200 price point. The proposed strike
setting regime would permit strikes to be set to more closely reflect
values in the underlying S&P 500 Index and allow investors and traders
to roll open positions from a lower strike to a higher strike in
conjunction with the price movement of the underlying.
    Pursuant to the strike price intervals established pursuant to Rule
504(h), where the next higher available series would be $5 away above a
$200 strike price, the ability to roll such positions is effectively
negated. Accordingly, to move a position from a $200 strike to a $205
strike pursuant to the current rule, an investor would need for the
underlying product to move 2.5%, and would not be able to execute a
roll up until such a large movement occurred. With the proposed rule
change, however, the investor would be in a significantly safer
position of being able to roll his open options position from a $200 to
a $201 strike price, which is only a 0.5% move for the underlying.
    The proposed rule change will allow the Exchange to better respond
to customer demand for IVV strike prices more precisely aligned with
current S&P 500 Index values. The Exchange believes that the proposed
rule change, like the other strike price programs currently offered by
the Exchange, will benefit investors by providing investors the
flexibility to more closely tailor their investment and hedging
decisions using IVV options. By allowing series of IVV options to be
listed in $1 intervals between strike prices over $200, the proposal
will moderately augment the potential total number of options series
available on the Exchange. However, the Exchange believes it and the
Options Price Reporting Authority (``OPRA'') have the necessary systems
capacity to handle any potential additional traffic associated with
this proposed rule change. The Exchange also believes that members will
not have a capacity issue due to the proposed rule change.
    In addition, the Exchange represents that it does not believe that
this expansion will cause fragmentation of liquidity. In addition, the
interval setting regime the Exchange proposes to apply to IVV options
is currently applied to options on SPY, which is an ETF that is
identical in all material respects to the IVV ETF.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\3\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\4\ in particular, the requirements of Section 6(b)
of the Act.\5\ Specifically, the Exchange believes the proposed rule
change is consistent with the Section 6(b)(5) \6\ requirements that the
rules of an exchange be designed to prevent fraudulent and manipulative
acts and practices, to promote just and equitable principles of trade,
to foster cooperation and coordination with persons engaged in
regulating, clearing, settling, processing information with respect to,
and facilitating transactions in securities, to remove impediments to
and perfect the mechanism of a free and open market and a national
market system, and, in general, to protect investors and the public
interest. Additionally, the Exchange believes the proposed rule change
is consistent with

the Section 6(b)(5) \7\ requirement that the rules of an exchange not
be designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(5).
    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
    \7\ Id.
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    In particular, the proposed rule change will allow investors to
more easily use IVV options. Moreover, the proposed rule change would
allow investors to better trade and hedge positions in IVV options
where the strike price is greater than $200, and ensure that IVV
options investors are not at a disadvantage simply because of the
strike price.
    The Exchange also believes the proposed rule change is consistent
with Section 6(b)(1) of the Act, which provides that the Exchange be
organized and have the capacity to be able to carry out the purposes of
the Act and the rules and regulations thereunder, and the rules of the
Exchange. The rule change proposal allows the Exchange to respond to
customer demand to allow IVV options to trade in $1 intervals above a
$200 strike price. The Exchange does not believe that the proposed rule
would create additional capacity issues or affect market functionality.
    As noted above, IVV options currently trade in wider $5 intervals
above a $200 strike price, whereas these options at or below a $200
strike price trade in $1 intervals. This creates a situation where
contracts on IVV options effectively may not be able to execute certain
strategies such as, for example, rolling to a higher strike price,
simply because of the arbitrary $200 strike price above which IVV
options intervals increase by 500%. This proposal remedies the
situation by establishing an exception to the current interval regime
for IVV options to allow such options to trade in $1 or greater
intervals at all strike prices.
    The Exchange believes that the proposed rule change, like other
strike price programs currently offered by the Exchange, will benefit
investors by giving them increased flexibility to more closely tailor
their investment and hedging decisions. Moreover, the proposed rule
change is consistent with a prior rule change.\8\
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    \8\ See Securities Exchange Act Release No. 72998 (September 4,
2014), 79 FR 53813 (September 10, 2014) (Notice of Filing of
Proposed Rule Change, Regarding Strike Price Intervals for SPY and
DIA Options) (SR-ISE-2014-42).
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    With regard to the impact of this proposal on system capacity, the
Exchange believes it and OPRA have the necessary systems capacity to
handle any potential additional traffic associated with this proposed
rule change. The Exchange believes that its members will not have a
capacity issue as a result of this proposal.
    In addition, the interval setting regime the Exchange proposes to
apply to IVV options is currently applied to options on SPY,\9\ which
is an ETF that is identical in all material respects to the IVV ETF.
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    \9\ See Supplementary Material .14 to Rule 504.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. Rather, the Exchange believes
that the proposed rule change will result in additional investment
options and opportunities to achieve the investment and trading
objectives of market participants seeking efficient trading and hedging
vehicles, to the benefit of investors, market participants, and the
marketplace in general. Specifically, the Exchange believes that IVV
options investors and traders will significantly benefit from the
availability of finer strike price intervals above a $200 price point.
In addition, the interval setting regime the Exchange proposes to apply
to IVV options is currently applied to options on SPY,\10\ which is an
ETF that is identical in all material respects to the IVV ETF. Thus,
applying the same strike setting regime to SPY and IVV options will
help level the playing field for options on similar, competing ETFs.
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    \10\ Id.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \11\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\12\
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    \11\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \12\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change, along
with a brief description and text of the proposed rule change, at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \13\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \14\ permits the
Commission to designate a shorter time if such action is consistent
with the protection of investors and the public interest. The Exchange
has asked the Commission to waive the 30-day operative delay because
this proposal permits listing IVV options in a manner permitted by the
Chicago Board Options Exchange, Incorporated,\15\ and will provide
investors with an alternative venue for trading IVV options. The
Commission also notes that the proposed rule change is consistent with
the strike price intervals in IVV options that is permitted on other
exchanges and thus raises no new novel or substantive issues.\16\
Accordingly, the Commission hereby waives the operative delay and
designates the proposal operative upon filing.\17\
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    \13\ 17 CFR 240.19b-4(f)(6).
    \14\ 17 CFR 240.19b-4(f)(6)(iii).
    \15\ See Securities Exchange Act Release No. 80913 (June 13,
2017), 82 FR 27907 (June 19, 2017) (SR-CBOE-2017-048).
    \16\ See NASDAQ PHLX LLC Rule 1012.05(a)(iv)(C); The Nasdaq
Options Market LLC Rules, Chapter IV, Section 6, Supplementary
Material .01(c); Miami International Securities Exchange, LLC Rule
404, Interpretations and Policies .10.
    \17\ For purposes only of waiving the 30-day operative delay,
the Commission has also considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or

     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-ISE-2017-79 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-ISE-2017-79. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; 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-ISE-2017-79 and should be
submitted on or before September 11, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-17550 Filed 8-18-17; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 83, Number 60 (Wednesday, March 28, 2018)]
[Notices]
[Page 13340]
[FR Doc No: 2018-06254]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

Agency Information Collection Activities: Requests for Comments;
Clearance of Renewed Approval of Information Collection: Commercial
Space Transportation Licensing Regulations

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice and request for comments.

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SUMMARY: In accordance with the Paperwork Reduction Act of 1995, FAA
invites public comments about our intention to request the Office of
Management and Budget (OMB) approval to renew an information
collection. The information will determine if applicant proposals for
conducting commercial space launches can be accomplished according to
regulations issued by the Office of the Associate Administrator for
Commercial Space Transportation.

DATES: Written comments should be submitted by May 29, 2018.

FOR FURTHER INFORMATION CONTACT: Barbara Hall at<PHONE_NUMBER>, or by
email at: [email protected].

SUPPLEMENTARY INFORMATION:
    OMB Control Number: 2120-0608.
    Title: Commercial Space Transportation Licensing Regulations.
    Form Numbers: FAA Form 8800-1.
    Type of Review: Renewal of an information collection.
    Background: The Commercial Space Launch Act of 1984, 49 U.S.C. App.
Sec. Sec.  2601-2623, as recodified at 49 U.S.C. Subtitle IX, Ch. 701--
Commercial Space Launch Activities, 49 U.S.C. 70101-70119 (1994),
requires certain data be provided in applying for a license to conduct
commercial space launch activities. These data are required to
demonstrate to the Federal Aviation Administration (FAA), Associate
Administrator for Commercial Space Transportation (AST), that a license
applicant's proposed activities meet applicable public safety, national
security, and foreign policy interests of the United States.
    Respondents: Approximately 17 space launch applicants (Initial,
Modification and Renewal).
    Frequency: Information is collected on occasion.
    Estimated Average Burden per Response: 264 hours.
    Estimated Total Annual Burden: 4,493 hours.

ADDRESSES: Send comments to the FAA at the following address: Barbara
Hall, Federal Aviation Administration, ASP-110, 10101 Hillwood Parkway,
Fort Worth, TX 76177.
    Public Comments Invited: You are asked to comment on any aspect of
this information collection, including (a) Whether the proposed
collection of information is necessary for FAA's performance; (b) the
accuracy of the estimated burden; (c) ways for FAA to enhance the
quality, utility and clarity of the information collection; and (d)
ways that the burden could be minimized without reducing the quality of
the collected information. The agency will summarize and/or include
your comments in the request for OMB's clearance of this information
collection.

    Issued in Fort Worth, TX on March 20, 2018.
Barbara L. Hall,
FAA Assistant Information Collection Clearance Officer, Performance,
Policy, and Records Management Branch, ASP-110.
[FR Doc. 2018-06254 Filed 3-27-18; 8:45 am]
 BILLING CODE 4910-13-P


[Federal Register Volume 75, Number 241 (Thursday, December 16, 2010)]
[Notices]
[Pages 78779-78780]
[FR Doc No: 2010-31537]

=======================================================================
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SECURITIES AND EXCHANGE COMMISSION

[Securities Act of 1933 Release No. 9162/December 10, 2010; Securities
Exchange Act of 1934 Release No. 63526/December 10, 2010]

Order Approving Public Company Accounting Oversight Board
Supplemental Budget Request To Establish an Office of Outreach and
Small Business Liaison in 2010

    The Sarbanes-Oxley Act of 2002 \1\ (the ``Sarbanes-Oxley Act'')
established the Public Company Accounting Oversight Board (the
``PCAOB'') to oversee the audits of companies and related matters, to
protect investors, and to further the public interest in the
preparation of informative, accurate and independent audit reports. The
PCAOB is to accomplish these goals through registration of public
accounting firms and standard setting, inspection, and disciplinary
programs. Section 109 of the Sarbanes-Oxley Act directs the PCAOB to
establish a budget for each fiscal year in accordance with the PCAOB's
internal procedures, subject to approval by the Securities and Exchange
Commission (the ``Commission'').
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    \1\ 17 U.S.C. 7202 et seq.
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    The Commission's Rules of Practice related to its Informal and
Other Procedures includes a rule to facilitate the Commission's review
and approval of PCAOB budgets.\2\ This budget rule provides, among
other things, a timetable for the preparation and submission of the
PCAOB budget, limits on the PCAOB's ability to incur expenses and
obligations except as provided in the approved budget, and procedures
relating to supplemental budget requests. In accordance with the
Commission's budget rule, the PCAOB submitted to the Commission a
budget for calendar year 2010 that was approved by the Commission on
December 22, 2009.\3\
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    \2\ 17 CFR 202.190. See Release No. 33-8724 (July 18, 2006) [71
FR 41998 (July 24, 2006)].
    \3\ See Release No. 34-61212 (Dec. 22, 2009).
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    Effective July 21, 2010, Section 982 of the Dodd-Frank Wall Street
Reform and Consumer Protection Act \4\ (the ``Dodd-Frank Act'') amended
the Sarbanes-Oxley Act to authorize the PCAOB, among other things, to
establish, subject to approval by the Commission, auditing and related
attestation, quality control, ethics, and independence standards to be
used by registered public accounting firms with respect to the
preparation and issuance of audit reports to be included in broker-
dealer filings with the Commission.\5\ In light of this new authority,
the PCAOB reassessed its communications and outreach strategy.
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    \4\ Public Law 111-203, 124 Stat. 1376 (July 21, 2010).
    \5\ 15 U.S.C. 78a et seq.
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    As a result of this reassessment, the PCAOB intends to enhance its
outreach function by establishing a new Office of Outreach and Small
Business Liaison (``Office of Outreach'') to act as a liaison between
the PCAOB and any PCAOB-registered public accounting firm, or any other
person affected by the Board's regulatory activities, including in
particular, entities in the small business community, such as the
auditors of broker-dealers. In order to establish this office in 2010,
the PCAOB is required under the budget rule to submit a supplemental
budget request for Commission approval.\6\ Pursuant to the procedures
set forth in the budget rule, on October 28, 2010, the PCAOB submitted
to the Commission a supplemental budget request seeking approval to
establish the Office of Outreach in 2010.\7\
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    \6\ See 17 CFR 240.190(b)(10).
    \7\ 17 CFR 202.190(f).
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    The Board believes that the creation of the Office of Outreach
would not result in a net cost increase in 2010. To the extent that any
unanticipated costs emerge, the PCAOB proposes to accommodate them from
within available funds currently budgeted for the Office of
Communications in 2010. Costs associated with the Office of Outreach in
future years will be considered by the Commission as part of its review
of the PCAOB budgets for those years.
    Staff from the Commission's Offices of the Chief Accountant and
Executive Director reviewed and analyzed the PCAOB's supplemental
budget request and did not identify any matters that are inconsistent
with Section 109 of the Sarbanes-Oxley Act or the Commission's budget
rule. Upon considering the staff's review and analysis, the Commission
has determined that the PCAOB's request to create the Office of
Outreach in 2010 is consistent with Section 109 of the

Sarbanes-Oxley Act and the Commission's budget rule. Accordingly,
    It is ordered, pursuant to Section 109 of the Sarbanes-Oxley Act,
that the PCAOB's supplemental budget request to create the Office of
Outreach in 2010 is approved.

    By the Commission.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2010-31537 Filed 12-15-10; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 87, Number 23 (Thursday, February 3, 2022)]
[Rules and Regulations]
[Pages 6017-6019]
[FR Doc No: 2022-02145]

=======================================================================
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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 25

[Docket No. FAA-2021-0897; Special Conditions No. 25-797-SC]

Special Conditions: Dassault Aviation Model Falcon 6X Airplane;
Electronic-System Security Protection From Unauthorized External Access

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final special conditions; request for comments.

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SUMMARY: These special conditions are issued for the Dassault Aviation
(Dassault) Model Falcon 6X airplane. This airplane will have a novel or
unusual design feature when compared to the state of technology
envisioned in the airworthiness standards for transport-category
airplanes. This design feature is the installation of a electronic
network system architecture that allows connection to airplane
electronic systems and networks, and access from airplane external
sources (e.g., operator networks, wireless devices, internet
connectivity, service provider satellite communications, electronic
flight bags, etc.) to the previously isolated airplane electronic
assets (networks, systems, and databases). The applicable airworthiness
regulations do not contain adequate or appropriate safety standards for
this design feature. These special conditions contain the additional
safety standards that the Administrator considers necessary to
establish a level of safety equivalent to that established by the
existing airworthiness standards.

DATES: This action is effective on Dassault on February 3, 2022. Send
comments on or before March 21, 2022.

ADDRESSES: Send comments identified by Docket No. FAA-2021-0897 using
any of the following methods:
     Federal eRegulations Portal: Go to https://www.regulations.gov/ and follow the online instructions for sending
your comments electronically.
     Mail: Send comments to Docket Operations, M-30, U.S.
Department of Transportation (DOT), 1200 New Jersey Avenue SE, Room
W12-140, West Building Ground Floor, Washington, DC 20590-0001.
     Hand Delivery or Courier: Take comments to Docket
Operations in Room W12-140 of the West Building Ground Floor at 1200
New Jersey Avenue SE, Washington, DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
     Fax: Fax comments to Docket Operations at<PHONE_NUMBER>.
    Privacy: Except for Confidential Business Information (CBI) as
described in the following paragraph, and other information as
described in 14 CFR 11.35, the FAA will post all comments received
without change to https://www.regulations.gov/, including any personal
information you provide. The FAA will also post a report summarizing
each substantive verbal contact received about these special
conditions.
    Confidential Business Information: Confidential Business
Information (CBI) is commercial or financial information that is both
customarily and actually treated as private by its owner. Under the
Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from
public disclosure. If your comments responsive to these special
conditions, contain commercial or financial information that is
customarily treated as private, that you actually treat as private, and
that is relevant or responsive to these special conditions. Notice, it
is important that you clearly designate the submitted comments as CBI.
Please mark each page of your submission containing CBI as ``PROPIN.''
The FAA will treat such marked submissions as confidential under the
FOIA, and the indicated comments will not be placed in the public
docket of these special conditions. Send submissions containing CBI to
the Information Contact below. Comments the FAA receives, which are not
specifically designated as CBI, will be placed in the public docket for
this rulemaking.
    Docket: Background documents or comments received may be read at
https://www.regulations.gov/ at any time. Follow the online
instructions for accessing the docket or go to Docket Operations in
Room W12-140 of the West Building Ground Floor at 1200 New Jersey
Avenue SE, Washington, DC, between 9 a.m. and 5 p.m., Monday through
Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT: Thuan T. Nguyen, Aircraft Information

Systems, AIR-622, Technical Innovation Policy Branch, Policy and
Innovation Division, Aircraft Certification Service, Federal Aviation
Administration, 2200 South 216th Street, Des Moines, Washington 98198;
telephone and fax<PHONE_NUMBER>; email [email protected].

SUPPLEMENTARY INFORMATION: The substance of these special conditions
has been published in the Federal Register for public comment in
several prior instances with no substantive comments received.
Therefore, the FAA finds, pursuant to Sec.  11.38(b), that new comments
are unlikely, and notice and comment prior to this publication are
unnecessary.

Comments Invited

    The FAA invites interested people to take part in this rulemaking
by sending written comments, data, or views. The most helpful comments
reference a specific portion of the special conditions, explain the
reason for any recommended change, and include supporting data.
    The FAA will consider all comments received by the closing date for
comments. The FAA may change these special conditions based on the
comments received.

Background

    On July 1, 2012, Dassault Aviation applied for a type certificate
for their new Model Falcon 5X airplane. However, Dassault has decided
not to release an airplane under the model designation Falcon 5X,
instead choosing to change that model designation to Falcon 6X.
    In February of 2018, due to engine supplier issues, Dassault
extended the type certificate application date for their Model Falcon
5X airplane under new Model Falcon 6X. This airplane is a twin-engine
business jet with seating for 19 passengers, and has a maximum takeoff
weight of 77,460 pounds.

Type Certification Basis

    Under the provisions of title 14, Code of Federal Regulations (14
CFR) 21.17, Dassault must show that the Model Falcon 6X airplane meets
the applicable provisions of part 25, as amended by amendments 25-1
through 25-146.
    If the Administrator finds that the applicable airworthiness
regulations (e.g., 14 CFR part 25) do not contain adequate or
appropriate safety standards for the Dassault Model Falcon 6X airplane
because of a novel or unusual design feature, special conditions are
prescribed under the provisions of Sec.  21.16.
    Special conditions are initially applicable to the model for which
they are issued. Should the type certificate for that model be amended
later to include any other model that incorporates the same novel or
unusual design feature, these special conditions would also apply to
the other model under Sec.  21.101.
    In addition to the applicable airworthiness regulations and special
conditions, the Dassault Model Falcon 6X airplane must comply with the
fuel-vent and exhaust-emission requirements of 14 CFR part 34, and the
noise-certification requirements of 14 CFR part 36.
    The FAA issues special conditions, as defined in 14 CFR 11.19, in
accordance with Sec.  11.38, and they become part of the type
certification basis under Sec.  21.17(a)(2).

Novel or Unusual Design Features

    The Dassault Model Falcon 6X airplane will incorporate the
following novel or unusual design feature:
    The installation of electronic network system architecture that
allows access from airplane external sources (e.g., operator networks,
wireless devices, internet connectivity, service provider satellite
communications, electronic flight bags, etc.) to the airplane's
previously isolated electronic assets (networks, systems, and
databases).

Discussion

    The Dassault Model Falcon 6X airplane architecture and network
configuration is novel or unusual for commercial transport airplanes
because it may allow increased connectivity to and access from external
network sources, airline operations, and maintenance networks, to the
airplane's control domain and airline information services domain. The
airplane's control domain and airline information-services domain
perform functions required for the safe operation and maintenance of
the airplane. Previously, these domains had very limited connectivity
with external network sources. This data network and design integration
creates a potential for unauthorized persons to access the aircraft-
control domain and airline information-services domain, and presents
security vulnerabilities related to the introduction of computer
viruses and worms, user errors, and intentional sabotage of airplane
electronic assets (networks, systems, and databases) critical to the
safety and maintenance of the airplane.
    The existing FAA regulations did not anticipate these networked
airplane-system architectures. Furthermore, these regulations and the
current guidance material do not address potential security
vulnerabilities, which could be exploited by unauthorized access to
airplane networks, data buses, and servers. Therefore, these special
conditions ensure that the security (i.e., confidentiality, integrity,
and availability) of airplane systems is not compromised by
unauthorized wired or wireless electronic connections. This includes
ensuring that the security of the airplane's systems is not compromised
during maintenance of the airplane's electronic systems. These special
conditions also require the applicant to provide appropriate
instructions to the operator to maintain all electronic-system
safeguards that have been implemented as part of the original network
design so that this feature does not allow or introduce security
threats.
    These special conditions contain the additional safety standards
that the Administrator considers necessary to establish a level of
safety equivalent to that established by the existing airworthiness
standards.

Applicability

    As discussed above, these special conditions are applicable to the
Dassault Model Falcon 6X airplane. Should Dassault apply at a later
date for a change to the type certificate to include another model
incorporating the same novel or unusual design feature, these special
conditions would apply to that model as well.

Conclusion

    This action affects only a certain novel or unusual design feature
on one model of airplane. It is not a rule of general applicability.

List of Subjects in 14 CFR Part 25

    Aircraft, Aviation safety, Reporting and recordkeeping
requirements.

Authority Citation

    The authority citation for these special conditions is as follows:

    Authority: 49 U.S.C. 106(f), 106(g), 40113, 44701, 44702, 44704.

The Special Conditions

    Accordingly, pursuant to the authority delegated to me by the
Administrator, the following special conditions are issued as part of
the type certification basis for the Dassault Model Falcon 6X airplane.
    1. The applicant must ensure airplane electronic-system security
protection from access by unauthorized sources external to the
airplane, including those possibly caused by maintenance activity.

    2. The applicant must ensure that electronic-system security
threats are identified and assessed, and that effective electronic-
system security-protection strategies are implemented to protect the
airplane from all adverse impacts on safety, functionality, and
continued airworthiness.
    3. The applicant must establish appropriate procedures to allow the
operator to ensure that continued airworthiness of the airplane is
maintained, including all post-type-certification modifications that
may have an impact on the approved electronic-system security
safeguards.

    Issued in Kansas City, Missouri, on January 28, 2022.
Patrick R. Mullen,
Manager, Technical Innovation Policy Branch, Policy and Innovation
Division, Aircraft Certification Service.
[FR Doc. 2022-02145 Filed 2-2-22; 8:45 am]
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[Federal Register: October 5, 2010 (Volume 75, Number 192)]
[Notices]
[Page 61552-61553]
[DOCID:fr05oc10-157]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

RTCA Government/Industry Air Traffic Management Advisory
Committee (ATMAC)

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of RTCA Government/Industry Air Traffic Management
Advisory Committee (ATMAC)

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

SUMMARY: The FAA is issuing this notice to advise the public of a
meeting of RTCA Government/Industry Air Traffic Management Advisory
Committee (ATMAC)

DATES: The meeting will be held October 28, 2010, from 9 a.m. to 11
a.m.

ADDRESSES: The meeting will be held at RTCA Headquarters, Colson Board
Room, 1828 L Street, NW., Suite 805, Washington, DC 20036
    METRO: Red Line--Farragut North Station (Use L Street Exit) Blue/
Orange Line--Farragut West Station (Use 18th Street Exit).

FOR FURTHER INFORMATION CONTACT: RTCA Secretariat, 1828 L Street, NW.,
Suite 805, Washington, DC, 20036; telephone<PHONE_NUMBER>; fax (202)
833-9434; Web site http://www.rtca.org.

SUPPLEMENTARY INFORMATION: Pursuant to section 10(a) (2) of the Federal
Advisory Committee Act (Pub. L. 92-463, 5 U.S.C., Appendix 2), notice
is hereby given for the Air Traffic Management Advisory Committee
meeting. The agenda will include:
     Opening Plenary (Welcome and Introductions).
     Consideration for approval of Interim Recommendations from
the Trajectory Operations (Tops) Work Group providing guidance to SC-
214 related to the development of standards for Air Traffic Control
Data Communications.
     FAA response on remaining gaps identified by the ATMAC
between the TF5 recommendations and the FAA's NextGen Implementation
Plan.
     Closing Plenary (Adjourn).
    Attendance is open to the interested public but limited to space
availability. With the approval of the chairmen, members of the public
may present oral statements at the meeting. Persons

wishing to present statements or obtain information should contact the
person listed in the FOR FURTHER INFORMATION CONTACT section. Members
of the public may present a written statement to the committee at any
time.

    Issued in Washington, DC, on September 29, 2010.
Robert L. Bostiga,
RTCA Advisory Committee.
[FR Doc. 2010-24994 Filed 10-4-10; 8:45 am]
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