[Federal Register Volume 76, Number 112 (Friday, June 10, 2011)]
[Notices]
[Page 34109]
[FR Doc No: 2011-14391]

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SECURITIES AND EXCHANGE COMMISSION

Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of Investor Education and Advocacy, Washington, DC
20549-2833.

Extension:
    Rule 30b1-5; SEC File No. 270-520; OMB Control No. 3235-0577.

    Notice is hereby given that, pursuant to the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (the ``Commission'') is soliciting comments on the
collection of information summarized below. The Commission plans to
submit this existing collection of information to the Office of
Management and Budget (``OMB'') for extension and approval.
    Rule 30b1-5 (17 CFR 270.30b1-5) under the Investment Company Act of
1940 (15 U.S.C. 80a-1 et seq.) (the ``Investment Company Act'')
requires registered management investment companies, other than small
business investment companies registered on Form N-5 (17 CFR 239.24 and
274.5) (``funds''), to file a quarterly report via the Commission's
EDGAR system on Form N-Q (17 CFR 249.332 and 274.130), not more than
sixty calendar days after the close of each first and third fiscal
quarter, containing their complete portfolio holdings. The purpose of
the collection of information required by rule 30b1-5 is to meet the
disclosure requirements of the Investment Company Act and to provide
investors with information necessary to evaluate an interest in the
fund by improving the transparency of information about the fund's
portfolio holdings.
    The Commission estimates that there are 2,580 management investment
companies, with a total of approximately 9,160 portfolios, that are
governed by the rule. For purposes of this analysis, the burden
associated with the requirements of rule 30b1-5 has been included in
the collection of information requirements of Form N-Q, rather than the
rule.
    The collection of information under rule 30b1-5 is mandatory. The
information provided under rule 30b1-5 is not kept confidential. An
agency may not conduct or sponsor, and a person is not required to
respond to, a collection of information unless it displays a currently
valid OMB control number.
    Written comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the agency, including whether the information will
have practical utility; (b) the accuracy of the agency's estimate of
the burden of the collection of information; (c) ways to enhance the
quality, utility, and clarity of the information collected; and (d)
ways to minimize the burden of the collection of information on
respondents, including through the use of automated collection
techniques or other forms of information technology. Consideration will
be given to comments and suggestions submitted in writing within 60
days of this publication.
    Please direct your written comments to Thomas A. Bayer, Director/
Chief Information Officer, Securities and Exchange Commission, c/o Remi
Pavlik-Simon, 6432 General Green Way, Alexandria, VA 22312; or send an
e-mail to<EMAIL_ADDRESS>
    Dated: June 6, 2011.
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-14391 Filed 6-9-11; 8:45 am]
BILLING CODE 8011-01-P


proposed amended exemption would incur costs associated with completing
and filing Form ADV for purposes of registration with the Commission,
and all of the advisers relying on the exemption will incur the costs
associated with keeping records sufficient to demonstrate that they
would be required to register with 15 or more states.\501\ In addition,
these advisers will incur costs of complying with the Advisers Act and
our rules, but they may see an absolute reduction in compliance costs
by registering with the Commission instead of 15 or more states.\502\
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    \498\ We also propose to renumber the rule as rule 203A-2(d).
See proposed rule 203A-2(d); supra section II.A.5.c. of this
Release.
    \499\ Advisers would be required to: (i) Include a
representation on Schedule D of Form ADV that the investment adviser
has concluded that it must register as an investment adviser with 15
or more states; and (ii) undertake to withdraw from registration
with the Commission if the adviser indicates on an annual updating
amendment to Form ADV that the investment adviser would be required
by the laws of fewer than 15 states to register as an investment
adviser with those states. See proposed rule 203A-2(d)(2).
    \500\ See supra note 324.
    \501\ See supra notes 325-327 and accompanying text.
    \502\ See supra note 323 and accompanying text.
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Elimination of Safe Harbor
    The proposed elimination of rule 203A-4, which provides a safe
harbor from Commission registration for an investment adviser based on
a reasonable belief that it is prohibited from registering with the
Commission because it does not have at least $30 million of assets
under management, would not create new requirements for small
advisers.\503\ These advisers would not have at least $30 million of
assets under management, and advisers have not, in our experience,
asserted the availability of this safe harbor.
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    \503\ Rule 203A-4. See supra section II.A.6. of this Release.
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Mid-Sized Advisers
    Our proposal to incorporate into Form ADV an explanation of how we
construe the determination of whether a mid-sized adviser is ``required
to be registered'' or is ``subject to examination'' by a particular
State securities authority for purposes of section 203A(a)(2)'s
prohibition on mid-sized advisers from registering with the Commission
would not create new reporting requirements for small advisers.\504\
The mid-sized adviser requirements would only apply to advisers with
assets under management between $25 million and $100 million and would
therefore not apply to small advisers.
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    \504\ See proposed Form ADV: Instructions for Part 1A, instr.
2.b.; supra section II.A.7. of this Release.
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Exempt Reporting Advisers
    Proposed rule 204-4 and the proposed amendments to rules 204-1,
Form ADV, and Form ADV-H to require exempt reporting advisers to file
reports with the Commission electronically on Form ADV would impose
reporting requirements on an estimated 6 small advisers.\505\ As
discussed above, we estimate that completing and filing Form ADV will
cost $1,764 for each exempt reporting adviser.\506\ In addition, small
exempt reporting advisers would be required to pay an estimated filing
fee of $200 annually,\507\ for a total of $1,200 for the estimated 6
small exempt reporting advisers.\508\ Finally, under rule 204-4 exempt
reporting advisers that seek a temporary hardship exemption from
electronic filing would be required to complete and file Form ADV-
H.\509\ To the extent that either of the estimated two small exempt
reporting advisers file Form ADV-H, we have estimated that it would
require 1 burden hour at a total cost of $204.\510\
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    \505\ See supra note 488.
    \506\ See supra note 338 and accompanying text. $3,528,000/2,000
= $1,764.
    \507\ See supra section IV.B.2. of this Release (discussing the
potential filing fee).
    \508\ $200 x 6 small exempt reporting advisers = $1,200.
    \509\ Proposed rule 204-4(e).
    \510\ See supra section IV.B.2. of this Release.
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Amendments to Form ADV
    Proposed amendments to Form ADV would require registered advisers
to report different or additional information than what is currently
required. Approximately 620 small advisers currently registered with
us, and two advisers currently relying on the private adviser exemption
that we expect will register with us, would be subject to these
requirements.\511\ We expect these 620 advisers would spend, on
average, 4.5 hours to respond to the new and amended questions we are
proposing today, other than the private fund reporting
requirements.\512\ We expect the aggregate cost associated with this
process would be $703,080.\513\ The two anticipated newly registering
advisers would spend, in the aggregate, about 82 hours total to
complete the form (Part 1 except for the private fund reporting
requirements, and Part 2) as well as to amend the form periodically, to
prepare brochure supplements, and to deliver codes of ethics to
clients,\514\ for a total cost of $20,664.\515\ In addition, of these
approximately 620 registered advisers, we estimate that 200 advise one
or more private funds and would have to complete the private fund
reporting requirements we are proposing today.\516\ We expect this will
take 600 hours,\517\ in the aggregate, for a total cost of
$151,200.\518\ The total estimated labor costs associated with our
amendments that we expect will be borne by small advisers, therefore,
are $874,944. Additionally, we estimate that one of the newly
registering advisers would use outside legal services to assist them in
preparing their Part 2 brochure, for a total non-labor cost of
$3,200.\519\
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    \511\ See supra notes 484-485 and accompanying text.
    \512\ See supra text preceding note 388. We are calculating
costs only of the increased burden because we have previously
assessed the costs of the other items of Form ADV for registered
advisers and for new advisers attributed to annual growth. The
amendments we are proposing today would increase neither the burden
associated with these items on Form ADV, nor the external costs
associated with certain Part 2 requirements.
    \513\ We expect that the performance of this function will most
likely be equally allocated between a senior compliance examiner and
a compliance manager. Data from the SIFMA Management and Earnings
Report, modified to account for an 1,800-hour work-year and
multiplied by 5.35 to account for bonuses, firm size, employee
benefits and overhead, suggest that costs for these positions are
$210 and $294 per hour, respectively. 620 advisers x 4.5 hours =
2,790 hours. [1,395 hours x $210 = $292,950] + [1,395 hours x $294 =
$410,130] = $703,080.
    \514\ 2 advisers x 40.74 hours per adviser to complete the
entire form (except private fund reporting requirements) = 81.48
hours.
    \515\ [41 hours x $210 = $8,610] + [41 hours x $294 = $12,054] =
$20,664. As noted above, we expect that the performance of this
function will most likely be equally allocated between a senior
compliance examiner and a compliance manager. See supra note 354.
    \516\ See supra note 404.
    \517\ We expect these advisers are likely to advise 3 funds
each. See text accompanying note 405. We estimated above that
private fund reporting would take an adviser approximately 1 hour
per fund to complete. 200 advisers x 3 hours = 600 hours.
    \518\ [300 hours x $210 = $63,000] + [300 hours x $294 =
$88,200] = $151,200. As noted above, we expect that the performance
of this function will most likely be equally allocated between a
senior compliance examiner and a compliance manager. See supra note
354.
    \519\ The currently approved burden associated with Form ADV
already accounts for similar estimated costs to be incurred by
current registrants. The non-labor costs for Form ADV are based on
an estimate that 50% of small advisers will retain either legal
services (at $3,200) or compliance consulting services (at $3,000)
to assist in the preparation of Form ADV. See supra note 420 and
accompanying text.
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Amendments to Pay to Play Rule
    Our proposed amendment to rule 206(4)-5 to make it apply to exempt
reporting advisers and foreign private advisers would not create new
reporting, recordkeeping, or other compliance requirements on these
advisers.\520\ Rather, we are proposing this amendment to ensure that
the rule

continues to apply to these advisers and to prevent the unintended
narrowing of the rule.\521\ Our proposed amendment to permit an adviser
to pay any registered municipal advisor subject to a pay to play rule
adopted by MSRB to solicit government entities on its behalf may create
new recordkeeping and compliance requirements on investment advisers
that are small entities subject to the rule to the extent that they
have to verify and document that placement agents that they hire to
solicit government entities are indeed registered municipal
advisors.\522\ Finally, our technical amendment to rule 206(4)-5's
definition of a ``covered associate'' \523\ of an investment adviser to
clarify that a legal entity, not just a natural person, that is a
general partner or managing member of an investment adviser would meet
the definition, would not create any new reporting, recordkeeping, or
other compliance requirements.\524\
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    \520\ See supra section II.D.1 of this Release (discussing these
amendments).
    \521\ See id.
    \522\ See id.
    \523\ See id.
    \524\ See id.
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Other Amendments
    Our proposed amendments to rule 204-2's grandfathering provision
are meant to ensure that private fund advisers that are required to
register as a result of the Dodd-Frank Act's elimination of the private
fund exemption in section 203(b)(3) would not face a retroactive
recordkeeping requirement.\525\ Our proposed technical amendment to
rule 204-2(e)(3)(ii) would add a cross-reference to the new definition
of a private fund in section 202(a)(29) of the Advisers Act.\526\ These
amendments would not create reporting, recordkeeping, and other
compliance requirements for small entities independent of the
reporting, recordkeeping, and other compliance requirements imposed by
current rule 204-2.\527\
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    \525\ See supra note 231 and accompanying text.
    \526\ See supra section II.D.2.b of this Release.
    \527\ The Dodd-Frank Act's removal of the private adviser
exemption in section 203(b)(3) may require additional small advisers
to register with the Commission. Therefore these small entities
would become subject to rule 204-2 with its reporting,
recordkeeping, and other compliance burdens. However, subjecting
these entities to rule 204-2 is a function of the Dodd-Frank Act's
removal of the private adviser exemption in section 203(b)(3), not
our proposed amendments to rule 204-2.
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    We do not believe that our proposed technical amendments to rules
0-7, 222-1, and 222-2 would impose reporting, recordkeeping, and other
compliance requirements on small advisers.

E. Duplicative, Overlapping, or Conflicting Federal Rules

    We believe that there are no proposed rules that duplicate,
overlap, or conflict with the proposed rules and rule and form
amendments.

F. Significant Alternatives

    The Regulatory Flexibility Act directs the Commission to consider
significant alternatives that would accomplish the stated objective,
while minimizing any significant adverse impact on small entities. In
connection with the proposed rule amendments, the Commission considered
the following alternatives: (i) The establishment of differing
compliance or reporting requirements or timetables that take into
account the resources available to small entities; (ii) the
clarification, consolidation, or simplification of compliance and
reporting requirements under the rules for such small entities; (iii)
the use of performance rather than design standards; and (iv) an
exemption from coverage of the rules, or any part thereof, for such
small entities.
    Regarding the first and fourth alternatives, we do not believe that
differing compliance or reporting requirements or an exemption from
coverage of the new rules or rule amendments, or any part thereof, for
small entities, would be appropriate or consistent with investor
protection or with Congress's mandate in the Dodd-Frank Act, to the
extent the new rule or amendment is being proposed due to a
Congressional mandate. Because the protections of the Advisers Act are
intended to apply equally to clients of both large and small advisory
firms, it would be inconsistent with the purposes of the Act to specify
different requirements for small entities under the proposed rules and
amendments unless expressly required to do so by Congress.
    Regarding the second alternative, proposed rule 203A-5 would enable
small advisers to easily and efficiently identify whether they are
subject to our regulatory authority after the Dodd-Frank Act's
amendment to section 203A becomes effective, and would also help
minimize any potential uncertainty about the effects of the Dodd-Frank
Act on their registration status by providing a simple, efficient means
of determining their post-Dodd-Frank registration status as of a
specific date. The proposed amendments to rule 203A-1 eliminate the $5
million buffer because it seems unnecessary in light of Congress's
determination to require many (although not all) advisers having
between $30 million and $100 million of assets under management to be
registered with the states,\528\ and makes the registration
requirements for advisers with assets under management between $25
million and $30 million uniform with the requirements for advisers with
assets under management between $30 million and $100 million. Our
proposal to amend the multi-State adviser exemption in rule 203A-2(e)
also would consolidate and simplify compliance for small advisers by
aligning the rule with the multi-State exemption Congress built into
the mid-sized adviser provision under section 410 of the Dodd-Frank Act
and by requiring one standard for advisers relying on the
exemption.\529\ This amendment also would reduce the compliance burdens
on advisers required to be registered with at least 15 states, but less
than 30, by allowing them to register with a single securities
regulator--the Commission. Furthermore, our proposal to use an existing
form, Form ADV, and an existing filing system, IARD, for reporting and
registration purposes will clarify and simplify the processes of
registering and/or reporting for small entities because: (i) All of the
information collection requirements for both registration and reporting
would be consolidated in a single form; (ii) a small exempt reporting
adviser would be able to use the same form and filing system both for
reporting and for purposes of registering with one or more State
securities authorities; and (iii) a small exempt reporting adviser may
find that it can no longer rely on an exemption from registration with
the Commission and would be able to register simply by filing an
amendment to its current Form ADV to apply for registration.\530\
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    \528\ See supra note 67.
    \529\ See proposed rule 203A-2(d); supra section IV.A.1. of this
Release. Under rule 203A-2(e), the prohibition on registration with
the Commission does not apply to an investment adviser that is
required to register with 30 or more states. Once registered with
the Commission, the adviser remains eligible for Commission
registration as long as it would be obligated, absent the exemption,
to register with at least 25 states. We propose to amend rule 203A-
2(e) to permit all investment advisers required to register as an
investment adviser with 15 or more states to register with the
Commission.
    \530\ See supra section II.C. of this Release.
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    Regarding the third alternative, we do not consider using
performance rather than design standards to be consistent with our
statutory mandate of investor protection or with Congress's mandate in
the Dodd-Frank Act.

G. Solicitation of Comments

    We encourage written comments on matters discussed in this IRFA. In

particular, the Commission seeks comment on:
     The number of small entities subject to the proposed rules
and rule and form amendments; and
     Whether the effect of the proposed rules and rule and form
amendments on small entities would be economically significant.

Commenters are asked to describe the nature of any effect and provide
empirical data supporting the extent of the effect.

VII. Effects on Competition, Efficiency and Capital Formation

    The Commission is proposing to adopt certain new rules and to amend
others pursuant to its authority under section 204(a) of the Advisers
Act,\531\ and sections 23(a) and 28(e)(2) of the Exchange Act.\532\
Section 204(a) of the Advisers Act and section 28(e)(2) of the Exchange
Act require the Commission, when engaging in rulemaking under the
authority provided in those sections, to consider whether the rule is
``necessary or appropriate in the public interest or for the protection
of investors.'' \533\ Section 202(c) of the Advisers Act requires the
Commission, when engaging in rulemaking that requires it to consider or
determine whether an action is necessary or appropriate in the public
interest, to consider, ``in addition to the protection of investors,
whether the action will promote efficiency, competition, and capital
formation.'' \534\ Section 3(f) of the Exchange Act requires the
Commission, when engaging in rulemaking that requires it to consider or
determine whether an action is necessary or appropriate in the public
interest to consider, in addition to the protection of investors,
whether the action will promote efficiency, competition, and capital
formation.\535\ Section 23(a) of the Exchange Act requires the
Commission, in adopting rules under the Exchange Act, to consider the
impact that any new rule would have on competition, and prohibits the
Commission from adopting any rule that would impose a burden on
competition not necessary or appropriate in furtherance of the purposes
of the Exchange Act.\536\
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    \531\ 15 U.S.C. 80b-4(a).
    \532\ 15 U.S.C. 78w(a) and 78bb(e)(2).
    \533\ 15 U.S.C. 80b-4(a) and 78bb(e)(2).
    \534\ 15 U.S.C. 80b-2(c).
    \535\ 15 U.S.C. 78c(f).
    \536\ 15 U.S.C. 78w(a)(2).
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    The Commission is proposing to adopt rule 204-4 and to amend rules
204-1 and 204-2 and Forms ADV, ADV-NR, and ADV-H.\537\ The proposed new
rule and rule and form amendments are designed to give effect to
provisions of Title IV of the Dodd-Frank Act.\538\ We are proposing new
rule 204-4 to require exempt reporting advisers to file reports with
the Commission electronically on Form ADV.\539\ We are also proposing
amendments to Form ADV to improve our risk-assessment capabilities and
so that it can serve the dual purpose of both an SEC reporting form for
exempt reporting advisers and, as it is used today, a registration form
for both State and SEC-registered firms.\540\ In addition to requiring
that exempt reporting advisers use Form ADV, proposed rule 204-4 would
require these advisers to submit reports through the IARD and to pay a
filing fee.\541\ We are also proposing to amend rule 204-1, which
addresses when and how advisers must amend their Form ADV, to add a
requirement that exempt reporting advisers file updating amendments to
reports filed on Form ADV.\542\
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    \537\ In contrast, we are proposing new rule 203A-5 and
amendments to rules 203A-1, 203A-2, 203A-3, and 203A-4 pursuant to
our authority set forth in sections 203A(c) and 211(a), amendments
to rules 0-7, 222-1, and 222-2 pursuant to our authority set forth
in section 211(a), and amendments to rule 206(4)-5 pursuant to our
authority set forth in sections 206(4) and 211(a). For a discussion
of the effects of this proposed new rule and rule amendments on
competition, efficiency, and capital formation, see supra sections
IV., V., and VI. of this Release.
    \538\ For a discussion of the overall objectives of our
proposals, see supra section I of this Release.
    \539\ Proposed rule 204-4. See supra section II.B.1. of this
Release.
    \540\ See supra sections II.B. and II.C. of this Release.
    \541\ Proposed rule 204-4(b). Proposed rule 204-4(e) would also
allow exempt reporting advisers having unanticipated technical
difficulties that prevent submission of a filing to the IARD system
to request a temporary hardship exemption from electronic filing
requirements by filing Form ADV-H. We are also proposing technical
amendments to Form ADV-H for this purpose.
    \542\ See proposed rule 204-1; supra section II.B.3. of this
Release.
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A. Proposed Exempt Reporting Adviser Reporting Requirements

    The Dodd-Frank Act provides that the Commission shall require
reporting by exempt reporting advisers, but it does not indicate the
information we should collect or the filing method by which it should
be collected. Our choices, in proposing rule 204-4 to require these
advisers to complete a sub-set of items contained in Form ADV and to
file through the IARD, and in proposing to amend rule 204-1 to impose
periodic updating requirements of those filings, would impose costs on
exempt reporting advisers,\543\ but would also create efficiencies that
benefit both us and filers by taking advantage of an established and
proven adviser filing system and avoiding the expense and delay of
developing a new form and filing system. Additionally, we believe this
proposal may create efficiencies to the extent exempt reporting
advisers may be required to register on Form ADV with one or more State
securities authorities because they would be using the existing form
and filing system that is also used by the states, which should reduce
regulatory burdens.\544\ Similarly, regulatory burdens would be
diminished for an exempt reporting adviser that later finds it can no
longer rely on an exemption and would be required to register with us
because the adviser would simply file an amendment to its current Form
ADV to apply for Commission registration.\545\
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    \543\ For a discussion of the costs of the reporting obligations
we are proposing to apply to exempt reporting advisers, see section
IV.B.2, of this Release.
    \544\ See supra section IV.A.2. of this Release.
    \545\ See proposed General Instruction 14 (providing procedural
guidance to advisers that no longer meet the definition of exempt
reporting adviser). See also supra note 128 and accompanying text.
Certain items in Form ADV Part 1 are also linked to Form B-D, which
would create efficiencies if the exempt reporting adviser ever
applies for broker-dealer registration.
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    Using Form ADV and IARD would also enable investors to access
information on our Web site that may have previously been unavailable
or not easily attainable, such as whether a prospective exempt
reporting adviser has reported disciplinary events and whether its
relationships with affiliates present conflicts of interest or
potential efficiencies. Public access to this information, which may
previously have been undisclosed, may promote competition to the extent
that it would allow private fund investors to make informed decisions
about these advisers, avoiding the burdens and costs associated with
selling private funds to switch advisers at a later date, and thereby
potentially creating efficiency gains in the marketplace and improving
allocation of client assets among investment advisers. The availability
of disciplinary information, in particular, about these advisers and
their supervised persons may also enhance competition if, for example,
firms and personnel with better disciplinary records outcompete those
with worse records. Alternatively, the choices that we have made about
the information these advisers would report (and that we would make
publicly available), such as the identification of owners of the
adviser or disciplinary information, could impose costs on advisers,
including the potential loss of business to competitors (who may or may
not report to us or be registered with us), as

this information may not typically be made available to others.
    Access to the information we propose to require exempt reporting
advisers to report may also increase clients' and prospective clients'
trust in investment advisers, which may encourage them to seek
professional investment advice and encourage them to invest their
financial assets. This may enhance capital formation by making more
funds available for investment and enhancing the allocation of capital
generally. On the other hand, to the extent that the information we
propose to collect and the filing method by which we propose to collect
it imposes costs on exempt reporting advisers that are then passed on
to clients, this may deter clients from seeking professional investment
advice and investing their financial assets. This may result in
inefficiencies in the market for advisory services and hinder capital
formation.

B. Proposed Risk-Assessment Amendments to Form ADV

    The amendments to Form ADV we are proposing today are designed to
improve advisers' disclosure of their business practices (particularly,
those relating to advising private funds), non-advisory activities and
financial industry affiliations, and other conflicts of interest.
Private fund reporting, in particular, would benefit private fund
investors and other market participants and would provide us and other
policy makers with better data. Better data would enhance our ability
to form and frame regulatory policies regarding the private fund
industry and fund advisers, and to evaluate the effect of our policies
and programs on this sector. Private fund reporting would provide us
with important information about this rapidly growing segment of the
U.S. financial system. Additionally, data about which advisers have $1
billion or more of assets would enable us to identify the advisers that
are covered by section 956 of the Dodd-Frank Act addressing certain
incentive-based compensation arrangements.
    As acknowledged above with respect to exempt reporting advisers,
there may also be competitive impacts between registered investment
advisers as a result of the collection of the proposed additional
information on Form ADV. For instance, information regarding the amount
of assets under management by specific types of clients could be used
by competitors when marketing their own advisory services. Another
example includes the information concerning private funds that we
propose to require registered and exempt reporting advisers to submit
on Form ADV, which could assist private fund investors in assessing
investment choices or screen funds based on certain parameters such as
the identification of certain fund service providers or gatekeepers.
Similarly, this information could be used by other financial service
providers (such as banks or broker-dealers) that do not provide similar
information publicly. Increased competition among investment advisers
(both exempt reporting and registered) and other financial service
providers may result in capital being allocated more efficiently,
benefiting clients and certain advisers.
    Better disclosure may increase clients' and prospective clients'
trust in investment advisers, which may encourage them to seek
professional investment advice and encourage them to invest their
financial assets. This also may enhance capital formation by making
more funds available for investment and enhancing the allocation of
capital generally. On the other hand, if the rule amendments increase
costs for investment advisers and these cost increases are passed on to
clients, this may deter clients from seeking professional investment
advice and investing their financial assets. This may result in
inefficiencies in the market for advisory services and hinder capital
formation.

C. Other Proposed Amendments

    Finally, we are proposing to amend rule 204-2 to cross-reference
the new definition of private fund and add a grandfathering provision
relieving firms that were exempt from registration prior to the
effectiveness of the Dodd-Frank Act's elimination of the ``private
adviser'' exemption from certain recordkeeping obligations applicable
to registered advisers.\546\ We also are amending Forms ADV-NR and Form
ADV-H to provide for their use by exempt reporting advisers. The
proposed amendments to rule 204-2, Form ADV-NR, and Form ADV-H are
technical in nature. We do not anticipate that they would have any
bearing on efficiency, competition, or capital formation.
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    \546\ See proposed rule 204-2; supra section II.D.2.b of this
Release. We also intend to rescind rule 204-2(l) because that
section was vacated by the Federal appeals court in Goldstein.
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D. Request for Comment

    The Commission requests comment whether the proposed rule and rule
amendments would, if adopted, promote efficiency, competition, and
capital formation. Commenters are requested to provide empirical data
to support their views.

VIII. Consideration of Impact on the Economy

    For purposes of the Small Business Regulatory Enforcement Fairness
Act of 1996, or ``SBREFA,'' \547\ the Commission must advise OMB
whether a proposed regulation constitutes a ``major'' rule. Under
SBREFA, a rule is considered ``major'' where, if adopted, it results in
or is likely to result in: (1) An annual effect on the economy of $100
million or more; (2) a major increase in costs or prices for consumers
or individual industries; or (3) significant adverse effects on
competition, investment, or innovation.
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    \547\ Public Law 104-121, Title II, 110 Stat. 857 (1996)
(codified in various sections of 5 U.S.C. and 15 U.S.C., and as a
note to 5 U.S.C. 601).
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    We request comment on the potential impact of the proposed new rule
and proposed rule amendments on the economy on an annual basis.
Commenters are requested to provide empirical data and other factual
support for their views to the extent possible.

IX. Statutory Authority

    The Commission is proposing new rule 203A-5 and amendments to rules
203A-1, 203A-2, 203A-3, and 203A-4 under the Advisers Act pursuant to
the authority set forth in sections 203A(c), and 211(a) of the
Investment Advisers Act of 1940 [15 U.S.C. 80b-3A(c) and 80b-11(a)];
new rule 204-4 and amendments to rules 204-1 and 204-2 pursuant to the
authority set forth in sections 204 and 211(a) of the Advisers Act [15
U.S.C. 80b-4 and 80b-11(a)]; amendments to rule 206(4)-5 pursuant to
authority set forth in sections 206(4) and 211(a) of the Advisers Act
[15 U.S.C. 80b-6(4) and 80b-11(a)]; amendments to rules 0-7, 222-1, and
222-2 pursuant to authority set forth in section 211(a) of the Advisers
Act [15 U.S.C. 80b-11(a)]; and to amend Form ADV under section 19(a) of
the Securities Act of 1933 [15 U.S.C. 77s(a)], sections 23(a) and
28(e)(2) of the Securities Exchange Act of 1934 [15 U.S.C. 78w(a) and
78bb(e)(2)], section 319(a) of the Trust Indenture Act of 1939 [15
U.S.C. 77sss(a)], section 38(a) of the Investment Company Act of 1940
[15 U.S.C. 78a-37(a)], and sections 203(c)(1), 204, and 211(a) of the
Investment Advisers Act of 1940 [15 U.S.C. 80b-3(c)(1), 80b-4, and 80b-
11(a)]; Form ADV-NR under section 19(a) of the Securities Act of 1933
[15 U.S.C. 77s(a)], section 23(a) of the Securities Exchange Act of
1934 [15 U.S.C. 78w(a)], section 319(a) of the Trust Indenture Act of
1939 [15 U.S.C. 77sss(a)], section 38(a) of the Investment Company Act
of 1940 [15 U.S.C. 78a-

37(a)], and sections 203(c)(1), 204, and 211(a) of the Investment
Advisers Act of 1940 [15 U.S.C. 80b-3(c)(1), 80b-4, and 80b-11(a)]; and
Form ADV-H pursuant to the authority set forth in sections 203(c)(1),
204, and 211(a) of the Advisers Act [15 U.S.C. 80b-3(c)(1), 80b-4, 80b-
11(a)].

List of Subjects in 17 CFR Parts 275 and 279

    Reporting and recordkeeping requirements; Securities.

Text of Rule and Form Amendments

    For the reasons set out in the preamble, Title 17 Chapter II of the
Code of Federal Regulations is proposed to be amended as follows.

PART 275--RULES AND REGULATIONS, INVESTMENT ADVISERS ACT OF 1940

    1-2. The authority citation for Part 275 is amended by revising the
general authority and by adding authority for sections 275.203A-5,
275.204-1 and 275.204-4 to read as follows:

    Authority:  15 U.S.C. 80b-2(a)(11)(G), 80b-2(a)(11)(H), 80b-
2(a)(17), 80b-3, 80b-4, 80b-4a, 80b-6(4), 80b-6a, and 80b-11, unless
otherwise noted.
* * * * *
    Section 275.203A-5 is also issued under 15 U.S.C. 80b-3a.
    Section 275.204-1 is also issued under sec. 407 and 408, Pub. L.
111-203, 124 Stat. 1376.
    Section 275.204-4 is also issued under sec. 407 and 408, Pub. L.
111-203, 124 Stat. 1376.

    3. Section 275.0-7 is amended by revising the reference to
``Section 203A(a)(2)'' in paragraph (a)(1) to read ``Section
203A(a)(3).''
    4. Section 275.203A-1 is revised to read as follows:

Sec.  275.203A-1  Switching to or from SEC registration.

    (a) State-registered advisers--switching to SEC registration. If
you are registered with a State securities authority, you must apply
for registration with the Commission within 90 days of filing an annual
updating amendment to your Form ADV reporting that you are eligible for
SEC registration and are not relying on an exemption from registration
under sections 203(l) or 203(m) of the Act (15 U.S.C. 80b-3(l), (m)).
    (b) SEC-registered advisers--switching to State registration. If
you are registered with the Commission and file an annual updating
amendment to your Form ADV reporting that you are not eligible for SEC
registration and are not relying on an exemption from registration
under sections 203(l) or 203(m) of the Act (15 U.S.C. 80b-3(l), (m)),
you must file Form ADV-W (17 CFR 279.2) to withdraw your SEC
registration within 180 days of your fiscal year end (unless you then
are eligible for SEC registration). During this period while you are
registered with both the Commission and one or more State securities
authorities, the Act and applicable State law will apply to your
advisory activities.
    5. Section 275.203A-2 is amended by:
    a. Removing paragraph (a);
    b. Redesignating paragraphs (b) through (f) as paragraphs (a)
through (e);
    c. Revising newly designated paragraph (a)(1);
    d. Revising the reference to ``paragraph (b) of this section'' in
newly designated paragraph (a)(2) to read ``paragraph (a) of this
section'';
    e. Revising newly designated paragraph (c)(1);
    f. Revising the reference in newly designated paragraph (c)(3) to
``Sec.  275.203A-1(b)(2)'' to read ``Sec.  275.203A-1(b)'';
    g. Revising newly designated paragraph (d)(1);
    h. Further redesignating newly designated paragraphs (d)(2) and
(d)(3) as paragraphs (d)(2)(i) and (d)(2)(ii);
    i. Adding new introductory text to paragraph (d)(2) and revising
newly designated paragraphs (d)(2)(i) and (d)(2)(ii);
    j. Further redesignating newly designated paragraph (d)(4) as
paragraph (d)(3);
    k. Revising the reference to ``paragraph (f) of this section'' in
newly designated paragraphs (e)(1)(ii), (e)(1)(iii), and (e)(2) to read
``paragraph (e) of this section'';
    l. Revising the reference to ``paragraph (f)(1)(i) of this
section'' in newly designated paragraph (e)(1)(ii) to read ``paragraph
(e)(1)(i) of this section'';
    m. Revising the reference ``paragraph (c) of this section'' in
newly designated paragraph (e)(1)(iii) to read ``paragraph (b) of this
section''; and
    n. Revising the reference ``Sec.  275.203(b)(3)-1'' in newly
designated paragraph (e)(3) to read ``Sec.  275.202(a)(30)-1''.
    The revisions and additions read as follows:

Sec.  275.203A-2   Exemptions from prohibition on Commission
registration.

    (a) Pension Consultants. (1) An investment adviser that is a
``pension consultant,'' as defined in this section, with respect to
assets of plans having an aggregate value of at least $200,000,000.
* * * * *
    (c) * * *
    (1) Immediately before it registers with the Commission, is not
registered or required to be registered with the Commission or a State
securities authority of any State and has a reasonable expectation that
it would be eligible to register with the Commission within 120 days
after the date the investment adviser's registration with the
Commission becomes effective;
* * * * *
    (d) * * *
    (1) Upon submission of its application for registration with the
Commission, is required by the laws of 15 or more States to register as
an investment adviser with the State securities authority in the
respective States, and thereafter would, but for this section, be
required by the laws of at least 15 States to register as an investment
adviser with the State securities authority in the respective States;
    (2) Elects to rely on paragraph (d) of this section by:
    (i) Indicating on Schedule D of its Form ADV that the investment
adviser has reviewed the applicable State and Federal laws and has
concluded that, in the case of an application for registration with the
Commission, it is required by the laws of 15 or more States to register
as an investment adviser with the State securities authorities in the
respective States or, in the case of an amendment to Form ADV, it would
be required by the laws of at least 15 States to register as an
investment adviser with the State securities authorities in the
respective States, within 90 days prior to the date of filing Form ADV;
and
    (ii) Undertaking on Schedule D of its Form ADV to withdraw from
registration with the Commission if the adviser indicates on an annual
updating amendment to Form ADV that the investment adviser would be
required by the laws of fewer than 15 States to register as an
investment adviser with the State securities authority in the
respective States, and that the investment adviser would be prohibited
by section 203A(a) of the Act (15 U.S.C. 80b-3a(a)) from registering
with the Commission, by filing a completed Form ADV-W within 180 days
of the adviser's fiscal year end (unless the adviser then has at least
$100 million of assets under management or is otherwise eligible for
SEC registration); and
* * * * *
    6. Section 275.203A-3 is amended by revising paragraph (a)(4) and
adding paragraphs (d) and (e) to read as follows:

Sec.  275.203A-3   Definitions.

* * * * *
    (a) * * *

    (4) Supervised persons may rely on the definition of ``client'' in
Sec.  275.202(a)(30)-1 to identify clients for purposes of paragraph
(a)(1) of this section, except that supervised persons need not count
clients that are not residents of the United States.
* * * * *
    (d) Assets under management. Determine ``assets under management''
by calculating the securities portfolios with respect to which an
investment adviser provides continuous and regular supervisory or
management services as reported on the investment adviser's Form ADV
(17 CFR 279.1).
    (e) State securities authority. ``State securities authority''
means the securities commissioner or commission (or any agency, office
or officer performing like functions) of any State.
    7. Section 275.203A-4 is removed and reserved.
    8. Section 275.203A-5 is added to read as follows:

Sec.  275.203A-5   Transition rules.

    (a) Every investment adviser registered with the Commission on July
21, 2011 shall file an other-than-annual amendment to Form ADV (17 CFR
279.1) no later than August 20, 2011 and shall determine its assets
under management based on the current market value of the assets as
determined within 30 days prior to the date of filing the Form ADV.
    (b) If an investment adviser registered with the Commission on July
21, 2011 would be prohibited from registering with the Commission under
section 203A(a)(2) of the Act (15 U.S.C. 80b-3a(a)(2)), and is not
otherwise exempted by Sec.  275.203A-2 from such prohibition, such
investment adviser shall withdraw from registration with the Commission
by filing Form ADV-W (17 CFR 279.2) no later than October 19, 2011.
During this period while an investment adviser is registered with both
the Commission and one or more State securities authorities, the Act
and applicable State law will apply to the investment adviser's
advisory activities.
    (c) If, prior to the effective date of the withdrawal from
registration of an investment adviser on Form ADV-W, the Commission has
instituted a proceeding pursuant to section 203(e) of the Act (15
U.S.C. 80b-3(e)) to suspend or revoke registration, or pursuant to
section 203(h) of the Act (15 U.S.C. 80b-3(h)) to impose terms or
conditions upon withdrawal, the withdrawal from registration shall not
become effective except at such time and upon such terms and conditions
as the Commission deems necessary or appropriate in the public interest
or for the protection of investors.
    9. Section 275.204-1 is amended by revising the heading, paragraphs
(b) and (c) to read as follows:

Sec.  275.204-1  Amendments to Form ADV.

* * * * *
    (b) Electronic filing of amendments.
    (1) Subject to paragraph (c), you must file all amendments to Part
1A of Form ADV and Part 2A of Form ADV electronically with the IARD,
unless you have received a continuing hardship exemption under Sec.
275.203-3. You are not required to file with the Commission amendments
to brochure supplements if required by Part 2B of Form ADV.
    (2) If you have received a continuing hardship exemption under
Sec.  275.203-3, you must, when you are required to amend your Form
ADV, file a completed Part 1A and Part 2A of Form ADV on paper with the
SEC by mailing it to FINRA.

    Note to paragraphs (a) and (b):  Information on how to file with
the IARD is available on our Web site at http://www.sec.gov/iard.
For the annual updating amendment: Summaries of material changes
that are not included in the adviser's brochure must be filed with
the Commission as an exhibit to Part 2A in the same electronic file;
and if you are not required to prepare a brochure, a summary of
material changes, or an annual updating amendment to your brochure,
you are not required to file them with the Commission. See the
instructions for Part 2A of Form ADV.

    (c) Transition to electronic filing. If you are required to file a
brochure and your fiscal year ends on or after December 31, 2010, you
must amend your Form ADV by electronically filing with the IARD one or
more brochures that satisfy the requirements of Part 2A of Form ADV (as
amended effective October 12, 2010) as part of the next annual updating
amendment that you are required to file.
* * * * *
    10. Section 275.204-2 is amended by removing paragraph (l), and
revising paragraph (e)(3)(ii) to read as follows:

Sec.  275.204-2  Books and records to be maintained by investment
advisers.

* * * * *
    (e) * * *
    (3) * * *
    (ii) Transition rule. If you are an investment adviser that was,
prior to July 21, 2011, exempt from registration under section
203(b)(3) of the Act (15 U.S.C. 80b-3(b)(3)), as in effect on July 20,
2011, paragraph (e)(3)(i) of this section does not require you to
maintain or preserve books and records that would otherwise be required
to be maintained or preserved under the provisions of paragraph (a)(16)
of this section to the extent those books and records pertain to the
performance or rate of return of such private fund (as defined in
section 202(a)(29) of the Act (15 U.S.C. 80b-2(a)(29)), or other
account you advise for any period ended prior to July 21, 2011,
provided that you were not registered with the Commission as an
investment adviser during such period, and provided further that you
continue to preserve any books and records in your possession that
pertain to the performance or rate of return of such private fund or
other account for such period.
* * * * *
    11. Section 275.204-4 is added to read as follows:

Sec.  275.204-4   Reporting by exempt reporting advisers.

    (a) Exempt reporting advisers. If you are an investment adviser
relying on the exemption from registering with the Commission under
section 203(l) or (m) of the Act (15 U.S.C. 80b-3(l) or 80b-3(m)), you
must complete and file reports on Form ADV (17 CFR 279.1) by following
the instructions in the Form, which specify the information that an
exempt reporting adviser must provide.
    (b) Electronic filing. You must file Form ADV electronically with
the Investment Adviser Registration Depository (IARD) unless you have
received a hardship exemption under paragraph (e) of this section.

    Note to paragraph (b):  Information on how to file with the IARD
is available on the Commission's Web site at http://www.sec.gov/iard.

    (c) When filed. Each Form ADV is considered filed with the
Commission upon acceptance by the IARD.
    (d) Filing fees. You must pay FINRA (the operator of the IARD) a
filing fee. The Commission has approved the amount of the filing fee.
No portion of the filing fee is refundable. Your completed Form ADV
will not be accepted by FINRA, and thus will not be considered filed
with the Commission, until you have paid the filing fee.
    (e) Temporary hardship exemption.
    (1) Eligibility for exemption. If you have unanticipated technical
difficulties that prevent submission of a filing to the IARD system,
you may request a temporary hardship exemption from the requirements of
this chapter to file electronically.
    (2) Application procedures. To request a temporary hardship
exemption, you must:
    (i) File Form ADV-H (17 CFR 279.3) in paper format no later than
one

business day after the filing that is the subject of the ADV-H was due;
and
    (ii) Submit the filing that is the subject of the Form ADV-H in
electronic format with the IARD no later than seven business days after
the filing was due.
    (3) Effective date--upon filing. The temporary hardship exemption
will be granted when you file a completed Form ADV-H.
    (f) Final report. You must file a final report in accordance with
instructions in Form ADV when:
    (1) You cease operation as an investment adviser;
    (2) You no longer meet the definition of exempt reporting adviser
under paragraph (a); or
    (3) You apply for registration with the Commission.

    Note to paragraph (f):  You do not have to pay a filing fee to
file a final report on Form ADV through the IARD.

    12. Section 275.206(4)-5 is amended by:
    a. In paragraph (f)(2)(i), removing the term ``individual'' and
adding in its place the term ``person''; and
    b. Revising paragraphs (a)(1), (a)(2) introductory text, (a)(2)(i),
(d), and (f)(9) to read as follows:

Sec.  275.206(4)-5   Political contributions by certain investment
advisers.

    (a) * * *
    (1) For any investment adviser registered (or required to be
registered) with the Commission, or unregistered in reliance on the
exemption available under section 203(b)(3) of the Advisers Act (15
U.S.C. 80b-3(b)(3)), or that is an exempt reporting adviser, as defined
in Sec.  275.204-4(a), to provide investment advisory services for
compensation to a government entity within two years after a
contribution to an official of the government entity is made by the
investment adviser or any covered associate of the investment adviser
(including a person who becomes a covered associate within two years
after the contribution is made); and
    (2) For any investment adviser registered (or required to be
registered) with the Commission, or unregistered in reliance on the
exemption available under section 203(b)(3) of the Advisers Act (15
U.S.C. 80b-3(b)(3)), or that is an exempt reporting adviser, or any of
the investment adviser's covered associates:
    (i) To provide or agree to provide, directly or indirectly, payment
to any person to solicit a government entity for investment advisory
services on behalf of such investment adviser unless such person is:
    (A) A regulated municipal advisor; or
    (B) An executive officer, general partner, managing member (or, in
each case, a person with a similar status or function), or employee of
the investment adviser; and
* * * * *
    (d) Further prohibition. As a means reasonably designed to prevent
fraudulent, deceptive or manipulative acts, practices, or courses of
business within the meaning of section 206(4) of Advisers Act (15
U.S.C. 80b-6(4)), it shall be unlawful for any investment adviser
registered (or required to be registered) with the Commission, or
unregistered in reliance on the exemption available under section
203(b)(3) of the Advisers Act (15 U.S.C. 80b-3(b)(3)), or that is an
exempt reporting adviser, or any of the investment adviser's covered
associates to do anything indirectly which, if done directly, would
result in a violation of this section.
* * * * *
    (f) * * *
    (9) Regulated municipal advisor means a municipal advisor
registered with the Commission under section 15B of that Act and
subject to rules of the Municipal Securities Rulemaking Board that:
    (i) Prohibit municipal advisors from engaging in distribution or
solicitation activities if certain political contributions have been
made; and
    (ii) The Commission, by order, finds:
    (A) Impose substantially equivalent or more stringent restrictions
on municipal advisors than this section imposes on investment advisers;
and
    (B) Are consistent with the objectives of this section.
* * * * *
    13. Section 275.222-1 is amended by revising the phrase ``Principal
place of business'' to read ``Principal office and place of business''
in both the heading and the first sentence of paragraph (b).
    14. Section 275.222-2 is revised to read as follows:

Sec.  275.222-2  Definition of ``client'' for purposes of the national
de minimis standard.

    For purposes of section 222(d)(2) of the Act (15 U.S.C. 80b-
18a(d)(2)), an investment adviser may rely upon the definition of
``client'' provided by Sec.  275.202(a)(30)-1, without giving regard to
paragraph (b)(4) of that section, provided that an investment adviser
is not required to count as a client any person for whom the investment
adviser provides advisory services without compensation.

PART 279--FORMS PRESCRIBED UNDER THE INVESTMENT ADVISERS ACT OF
1940

    15. The authority citation for Part 279 continues to read as
follows:

    Authority: The Investment Advisers Act of 1940, 15 U.S.C. 80b-1,
et seq.

Sec.  279.1  [Amended]

    16. Form ADV [referenced in Sec.  279.1] is amended by:
    a. In the instructions to the form, revising the section entitled
``Form ADV: General Instructions.'' The revised version of Form ADV:
General Instructions is attached as Appendix A;
    b. In the instructions to the form, revising the section entitled
``Form ADV: Instructions for Part 1A.'' The revised version of Form
ADV: Instructions for Part 1A is attached as Appendix B;
    c. In the instructions to the form, revising the section entitled
``Form ADV: Glossary of Terms.'' The revised version of Form ADV:
Glossary of Terms is attached as Appendix C;
    d. In the form, revising Part 1A. The revised version of Form ADV,
Part 1A is attached as Appendix D;
    e. In the form, revising the reference to ``proceeding'' in Item
3.D. of Part 2B to read ``hearing or formal adjudication''; and
    f. In the form, revising the section entitled ``Form ADV: Domestic
Investment Adviser Execution Page.'' The revised version of Form ADV:
Domestic Investment Adviser Execution Page is attached as Appendix E.
    The revisions read as follows:

    Note: The text of Form ADV does not and the amendments will not
appear in the Code of Federal Regulations.

* * * * *
Form ADV: Part 2B
* * * * *
    Item 3. * * *
    D. Any other hearing or formal adjudication in which a professional
attainment, designation, or license of the supervised person was
revoked or suspended because of a violation of rules relating to
professional conduct. If the supervised person resigned (or otherwise
relinquished the attainment, designation, or license) in anticipation
of such a hearing or formal adjudication (and the adviser knows, or
should have known, of such resignation or relinquishment), disclose the
event.
* * * * *

Sec.  279.3  [Amended]

    17. Form ADV-H [referenced in Sec.  279.3] is amended by revising
the form. The revised version of Form ADV-H is attached as Appendix F.

     Note: The text of Form ADV-H does not and the amendments will
not appear in the Code of Federal Regulations.

Sec.  279.4  [Amended]

    18. Form ADV-NR [referenced in Sec.  279.4] is amended by revising
the form. The revised version of Form ADV-NR is attached as Appendix G.

     Note: The text of Form ADV-NR does not and the amendments will
not appear in the Code of Federal Regulations.

    By the Commission.

    November 19, 2010.
Elizabeth M. Murphy,
Secretary.
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[FR Doc. 2010-29956 Filed 12-9-10; 8:45 am]
BILLING CODE C


TABLE 2  Estimated Annual Industry Burden To Implement Marine Tank Vessel Loading Operations ( a)

( A) ( B) ( C) ( D) ( E) ( F)

Person Hrs per No. occurrence Person Hrs Resp. Tech. hr Mgmt. hr Occurrence per year per Respondent per year per year per year per year BURDEN ITEM ( C= A* B) ( E= C* D) ( F= E*. 05)

1. Application N/ A 2. Surveys and Studies N/ A 3. Reporting Requirements A. Read Instructions 1 1 1 105 105 5 B. Required Activities:

Performance Test ( d, e) c 280 1 280 0 0 0 Repeat of Performance Test ( d, e, f) c 280 1 280 0 0 0 Annual leak checks ( g, h) c 16 1 16 105 1,680 84 Annual vapor tightness test ( i, j) f 8 1 8 k 1,299 10,392 520 C. Create Information ( d) Incl. in 3b & 4e D. Gather existing information ( d) Incl. in 3b & 4e E. Write Report:

Notification of construction/ reconstruction ( d) 2 1 2 0 0 0 Notification of anticipated startup ( d) 2 1 2 0 0 0 Notification of actual startup 2 1 2 0 0 0 Initial notification of applicability report ( d) 4 1 4 0 0 0 Waiver application ( d, l) 2 1 2 0 0 0 Alt. test method/ monitoring application ( d, m) 1 1 1 0 0 0 Preparation of site specific test plan Included in 3B Notification of initial compliance test date ( d) 2 1 2 0 0 0 Notification of initial compliance status ( initial performance test) ( d) Included in 3B Excess emissions and monitoring exceedances report and/ or Summary report ( Ongoing compliance status report) ( n) 32 1 32 105 3,360 168 Report of HAP control efficiency 8 4 32 105 3,360 168 Reporting Requirement subTOTAL 4. Recordkeeping Requirements:

A. Read Instructions 1 1 1 105 105 5 B. Plan Activities N/ A C. Implement Activities ( d) 16 1 16 0 0 0 D. Develop Record System ( d) 16 1 16 0 0 0 E. Time to Enter Information 1 52 52 105 5,460 273 F. Time to train personnel N/ A G. Time for Audits N/ A Recordkeeping Requirements subTOTAL TOTAL  ALL BURDEN ITEMS 24,462 1,223 a Calculation of burden and cost values reflects rounding of numbers b Respondents per year are explained in the text.

c Cost is based on rates from the U. S. Dept. of Commerce, Bureau of Labor Statistics, March 2001, Table 10: Employment Costs for Private Industry by Occupational and Industrial Group. The wage rates have been loaded by adding 110% overhead:

Executive, Administrative and Managerial =$ 78.54 ($ 37.40+ 110%); Technical = $ 55.34 ($ 26.35 + 110%); Clerical = $ 35.64 ($ 16.97+ 110%)

d One time only costs.

e Assumes Method 25 or 25A test f Assumes 15 percent of the initial performance tests are repeated due to failure of the first test.

g All affected facilities must report this information each year.

h Assumes a Method 21 test for system tightness.

i This burden is to the owners of marine vessels and not to the affected facilities.

j Assumes a Method 21 test on a vessel takes 8 hours.

k This number calculated using fleet factors and affected facility throughput and then divided in half. Assumes that half of the facilities load at negative pressure.

l Assume 5 percent of facilities request a waiver.

m Assumes 1 percent of facilities will request alternative test methods or monitoring methods.

n Assumes each facility will submit one excess emissions and monitoring exceedances report and/ or summary report per year. ( G) ( H)

Clerical hr per year COST ($)

( G= E* 0.1)

11 5,442 0 0 0 0 168 105,556 1,039 652,940 0 0 0 0 0 0 0 0 0 0 0 0 0 0 336 211,112 336 211,112 11 6,597 0 0 0 0 546 343,057 2,446 1,535,817


[Federal Register Volume 87, Number 26 (Tuesday, February 8, 2022)]
[Rules and Regulations]
[Pages 7033-7037]
[FR Doc No: 2022-02554]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2021-0501; Project Identifier MCAI-2021-00168-T;
Amendment 39-21908; AD 2022-02-11]
RIN 2120-AA64

Airworthiness Directives; Airbus SAS Airplanes

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

ACTION: Final rule.

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

SUMMARY: The FAA is superseding Airworthiness Directive (AD) 2019-20-
10, which applied to certain Airbus SAS Model A318 series airplanes;
Model A319-111, -112,-113, -114, -115, -131, -132, and -133 airplanes;
Model A320-211, -212, -214, -216, -231, -232, and -233 airplanes; and
Model A321-111, -112, -131, -211, -212, -213, -231, and -232 airplanes.
AD 2019-20-10 required repetitive rototest inspections of the holes at
the door stop fittings for any cracking, and corrective actions if
necessary. Since the FAA issued AD 2019-20-10, a clarification of a
certain compliance time for the rototest inspection was added. This AD
clarifies a certain compliance time and continues to require repetitive
rototest inspections of the holes at the door stop fittings for any
cracking, and repair if necessary, as specified in a European Union
Aviation Safety Agency (EASA) AD, which is incorporated by reference.
The FAA is issuing this AD to address the unsafe condition on these
products.

DATES: This AD is effective March 15, 2022.
    The Director of the Federal Register approved the incorporation by
reference of a certain publication listed in this AD as of March 15,
2022.

ADDRESSES: For material incorporated by reference (IBR) in this AD,
contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; telephone
+49 221 8999 000; email [email protected]; internet
www.easa.europa.eu. You may find this IBR material on the EASA website
at https://ad.easa.europa.eu. You may view this material at the FAA,
Airworthiness Products Section, Operational Safety 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 in the AD
docket at https://www.regulations.gov by searching for and locating
Docket No. FAA-2021-0501.

Examining the AD Docket

    You may examine the AD docket at https://www.regulations.gov by
searching for and locating Docket No. FAA-2021-0501; 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
mandatory continuing airworthiness information (MCAI), 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: Sanjay Ralhan, Aerospace Engineer,
Large Aircraft Section, International Validation Branch, FAA, 2200
South 216th St., Des Moines, WA 98198; telephone and fax<PHONE_NUMBER>;
email [email protected].

SUPPLEMENTARY INFORMATION:

Background

    EASA, which is the Technical Agent for the Member States of the
European Union, has issued EASA AD 2018-0289R1, dated February 10, 2021
(EASA AD 2018-0289R1) (also referred to as the MCAI), to correct an
unsafe condition for certain Airbus SAS Model A318 series airplanes;
Model A319-111, -112, -113, -114, -115, -131, -132, and -133 airplanes;
Model A320-211, -212, -214, -215, -216, -231, -232, and -233 airplanes;
and Model A321-111, -112, -131, -211, -212, -213, -231, and -232
airplanes. EASA AD 2018-0289R1 supersedes EASA AD 2018-0289 (which
corresponds to FAA AD 2019-20-10, Amendment 39-19763 (84 FR 61526,
November 13, 2019) (AD 2019-20-10). Model A320-215 airplanes are not
certificated by the FAA and are not included on the U.S. type
certificate data sheet; this AD therefore does not include those
airplanes in the applicability.
    The FAA issued a notice of proposed rulemaking (NPRM) to amend 14
CFR part 39 to supersede AD 2019-20-10. AD 2019-20-10 applied to
certain Airbus SAS Model A318 series airplanes; Model A319-111, -112, -
113, -114, -115, -131, -132, and -133 airplanes; Model A320-211, -212,
-214, -216, -231, -232, and -233 airplanes; and Model A321-111, -112, -
131, -211, -212, -213, -231, and -232 airplanes. The NPRM published in
the Federal Register on June 16, 2021 (86 FR 31989). The NPRM was
prompted by a report that cracks were detected on frame (FR)16 and FR20
web holes and passenger door intercostal fitting holes at the door stop
fitting locations, and a determination that a certain compliance time
needs to be clarified. The NPRM proposed to clarify a certain
compliance time and continue to require repetitive rototest inspections
of the holes at the door stop fittings for any cracking, and repair if
necessary as specified in EASA AD 2018-0289R1.
    The FAA is issuing this AD to address cracking of the web holes at
the door stop fittings, which could affect the structural integrity of
the airplane. See the MCAI for additional background information.

Discussion of Final Airworthiness Directive

Comments

    The FAA received comments from two commenters, including Delta
Airlines (DAL) and United Airlines (UAL). The following presents the
comments received on the NPRM and the FAA's response to each comment.

Request To Clarify the Requirements of the Repair Design Approval Sheet
(RDAS)

    DAL requested clarification for the following RDAS approval:
     Can the FAA confirm that paragraph (h)(4) of the proposed
AD allow operators to account for repairs that are approved using a
Repair and Design Approval Form (RDAF) in addition to those repairs
that are approved using RDAS? DAL commented that since 2021, the RDAS
is no longer Airbus's form of approving repair instructions and it has
been replaced by RDAF.
     Can the FAA confirm that if a repair has been approved,
``in accordance with a method approved by the Manager, Large Aircraft
Section, International Validation Branch, FAA; or EASA; or Airbus SAS's
EASA Design Organization Approval (DOA). If approved by the DOA, the
approval must include the DOA-authorized signature,'' it is acceptable
to accomplish the next inspection for each repaired area affected by
using the same method of compliance? DAL commented that if this is the
case, it requests the FAA either revise paragraph (h)(4) of the
proposed AD or include an exception paragraph to the proposed AD to
explicitly makes this clear.
    The FAA confirms that it accepts Airbus's EASA DOA approval in the
form of both an RDAS and an RDAF. The FAA also confirms that for
paragraph (3) of EASA AD 2018-0289R1, the next inspections are done at
the times specified in the approved method. The FAA has added paragraph
(h)(5) of this AD to specify where paragraph (3) of EASA AD 2018-0289R1
refers to accomplishing the next due inspection of each repaired
affected area ``within the compliance time as specified in, Airbus
RDAS, as applicable,'' this AD uses the applicable compliance time
specified in the repair ``approved by the Manager, Large Aircraft
Section, International Validation Branch, FAA; or EASA; or Airbus SAS's
EASA Design Organization Approval (DOA). If approved by the DOA, the
approval must include the DOA-authorized signature.''

Request To Revise the Compliance Time

    UAL stated AD 2018-0289R1 was issued to clarify that, to determine
the compliance time for the initial inspection of an affected area, the
latest accomplishment of the airworthiness limitations item (ALI) task
for that affected area must be taken into account. UAL stated that the
initial inspection for the FR16 door stop fitting holes cannot be
accomplished within 16,800 flight cycles from ALI task 531103-01-1 if
FR20 was the only applicable side for the task at ``[airworthiness
limitations section] ALS Part 2 Rev 3'' or earlier revisions. UAL
commented that, therefore, the proposed AD may have an impact on an
airline's operation and, for FR16 only, result in immediate
non[hyphen]compliance if ALI task 531103-01-1 was accomplished at ``ALS
Part 2 Rev 3'' or earlier revisions for FR20. UAL stated that condition
``A'' in ``Table 1: Inspection Thresholds'' of AD 2018-0289R1,
specifies the inspection threshold for FR16 as 30,000 total flight
cycles and certain airplanes may be above 30,000 total flight cycles
under this condition.
    UAL commented that the side of FR16 was added to the ALI task
531103-01-1 description in ``ALS Part 2 Rev 4,'' and as stated in ``ALS
Part 2 Rev 4, Section 2 Paragraph 1(1),'' the two digit sequence number
following structural significant item number (i.e., 531103-01) changes
when the inspection area is physically different (i.e., FR16 or FR20).
UAL also commented that ``ALS Part 2 Rev 4'' did not change the ALI
task sequence number or describe any retroactive action if FR20 was the
only side previously inspected using ``ALS Part 2 Rev 3'' or earlier
revisions. UAL stated that it believes this change was overlooked in
``ALS Part 2 Rev 4,'' and as a result, operators may not have been
aware to reset the initial inspection for the ALI for FR16.
    The FAA acknowledges the commenter's concern for the FR16
inspection requirement. The FAA has added paragraph (h)(6) to this AD
to include a 30-day grace period as of the effective date of this AD
for airplanes affected by condition ``A'' in ``Table 1: Inspection
Thresholds'' of AD 2018-0289R1. The 30-day grace period prevents
grounding of airplanes that are above the 30,000 total flight cycle
threshold while still allowing for an acceptable level of safety.
    Regarding the change in ``ALS part 2 Rev 4,'' the FAA notes that
the description for task 531103-01 to accomplish the inspection for
FR16 and FR20 is specified in ``ALS part 2 Rev 4.'' The change related
to FR16 was also referenced in the record of revision section of ``ALS
part 2.''

Request To Clarify Alternative Method of Compliance (AMOC) Approvals

    DAL requested clarification of AMOC approvals as specified in
paragraphs (i)(1)(i) and (ii) of the proposed AD. DAL commented on a
scenario where an AMOC was approved for AD 2019-20-10 for an operator's
entire fleet, which included a deviation to one of the paragraphs in
EASA AD 2018-0289 and a deviation to one of the applicable service
bulletins for correcting an error. DAL commented that because the AMOC
is applicable to the whole fleet, it is possible that the AMOC approval
applies to a manufacturer serial number that is applicable to the
compliance time specified in ``Table 1: Inspection Thresholds,'' Row B,
of EASA AD 2018-0289R1. DAL asked if this particular AMOC still applies
once the final rule becomes effective or is a new AMOC request required
for a deviation to the EASA AD requirements and for the service
bulletin correction?
    The FAA agrees to provide clarification. The intent of the
paragraph (i)(1)(i) and (ii) of this AD is to ensure that existing
AMOCs are not inadvertently affected with the new inspection threshold
added in EASA AD 2018-0289R1. It is the operator's responsibility to
consult with the FAA oversight office and the office responsible for
the issuance of an AMOC if AMOC validity is impacted by ``Table 1:
Inspection Thresholds,'' Row B, of EASA AD 2018-0289R1. If an AMOC is
issued to correct service bulletin errors and it is not related to the
inspection threshold change in ``Table 1: Inspection Thresholds,'' Row
B, of EASA AD 2018-0289R1, then it would be applicable to this AD
without further evaluation. The FAA has not changed the AD in this
regard.

Requests To Include or Exclude a Reporting Requirement

    UAL requested that the proposed AD include a reporting requirement
for the inspection. UAL stated that it believes no reporting to the
manufacturer is required since it is not a requirement in AD 2019-20-10
or EASA AD 2018-0289R1; however, UAL also noted that Airbus Mandatory
Bulletin A320-53-1339, Revision 01, dated April 7, 2021, contains
reporting in the ``Required for Compliance'' section of the service
bulletin.
    DAL requested that the FAA add a statement to paragraph (h) of the
proposed AD exempting operators from any mandatory reporting. DAL
commented that Airbus has issued Mandatory Bulletin A320-53-1339,
Revision 01, dated April 7, 2021, and that paragraph 3.C. of the
service bulletin contains instructions to complete an ``Inspection
Report Sheet'' form and to send the completed form to Airbus. DAL
stated that paragraph 3.C.(8) of Airbus Mandatory Bulletin

A320-53-1339, Revision 01, dated April 7, 2021, is considered an ``RC''
paragraph, and therefore, reporting the inspection results is
considered mandatory. DAL commented that, typically, reporting is
needed from operators to determine root cause of the issue and that the
root cause of the safety concern is already addressed in previously
issued revisions of the service information.
    The FAA agrees to clarify. EASA AD 2018-0289R1 does not include a
reporting requirement that is separate from the reporting to address an
unsafe condition (inspection findings); however EASA AD 2018-0289R1
allows the use of later-approved revisions of the service information,
which includes Airbus Mandatory Service Bulletin A320-53-1339, Revision
01, dated April 7, 2021. Airbus Mandatory Service Bulletin A320-53-
1339, Revision 01, dated April 7, 2021, specifies reporting is
necessary if the cracked intercostal(s) are replaced according to
repair instruction R53113118. The FAA would also like to clarify that
requirements to contact manufacturer to obtain method of compliance
does not require specific reporting requirements and must be complied
with.
    The FAA has added paragraph (h)(7) of this AD to clarify that the
reporting specified in paragraph 3.C.(8) of the inspection service
bulletin referenced in EASA AD 2018-0289R1, is required only if the
cracked intercostal(s) have been replaced using repair instruction
R53113118.

Conclusion

    The FAA reviewed the relevant data, considered the comments
received, and determined that air safety requires adopting this AD as
proposed. Except for minor editorial changes, and any other changes
described previously, this AD is adopted as proposed in the NPRM. None
of the changes will increase the economic burden on any operator.
Accordingly, the FAA is issuing this AD to address the unsafe condition
on these products.

Related Service Information Under 1 CFR Part 51

    EASA AD 2018-0289R1 describes procedures for repetitive rototest
inspections of the holes at the door stop fittings for any cracking and
repair if necessary. This material 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 1,528 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.
                Action                         Labor cost           Parts cost        product        operators
----------------------------------------------------------------------------------------------------------------
Retained actions from AD                33 work-hours x $85 per               $0          $2,805      $3,447,345
 2019[dash]20[dash]10 (1,229             hour = $2,805.
 airplanes).
Inspections...........................  33 work-hours x $85 per                0           2,805       4,286,040
                                         hour = $2,805.
----------------------------------------------------------------------------------------------------------------

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

                                     Estimated Costs of On-Condition Actions
----------------------------------------------------------------------------------------------------------------
                                 Labor cost                                     Parts cost     Cost per product
----------------------------------------------------------------------------------------------------------------
51 work-hours x $85 per hour = $4,335 (repair)..............................            $350              $4,685
1 work-hours x $85 per hour = $85 (reporting)...............................               0                  85
----------------------------------------------------------------------------------------------------------------

Paperwork Reduction Act

    A federal agency may not conduct or sponsor, and a person is not
required to respond to, nor shall a person be subject to penalty for
failure to comply with a collection of information subject to the
requirements of the Paperwork Reduction Act unless that collection of
information displays a currently valid OMB Control Number. The OMB
Control Number for this information collection is 2120-0056. Public
reporting for this collection of information is estimated to take
approximately 1 hour per response, including the time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collection of information. All responses to this collection of
information are mandatory. Send comments regarding this burden estimate
or any other aspect of this collection of information, including
suggestions for reducing this burden, to Information Collection
Clearance Officer, Federal Aviation Administration, 10101 Hillwood
Parkway, Fort Worth, TX 76177-1524.

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.

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:
0
a. Removing Airworthiness Directive (AD) AD 2019-20-10, Amendment 39-
19763 (84 FR 61526, November 13, 2019); and
0
b. Adding the following new AD:

2022-02-11 Airbus SAS: Amendment 39-21908; Docket No. FAA-2021-0501;
Project Identifier MCAI-2021-00168-T.

(a) Effective Date

    This airworthiness directive (AD) is effective March 15, 2022.

(b) Affected ADs

    This AD replaces AD 2019-20-10, Amendment 39-19763 (84 FR 61526,
November 13, 2019) (AD 2019-20-10).

(c) Applicability

    This AD applies to Airbus SAS airplanes specified in paragraphs
(c)(1) through (4) of this AD, certificated in any category, as
identified in European Union Aviation Safety Agency (EASA) AD 2018-
0289R1, dated February 10, 2021 (EASA AD 2018-0289R1).
    (1) Model A318-111, -112, -121, and -122 airplanes.
    (2) Model A319-111, -112, -113, -114, -115, -131, -132, and -133
airplanes.
    (3) Model A320-211, -212, -214, -216, -231, -232, and -233
airplanes.
    (4) Model A321-111, -112, -131, -211, -212, -213, -231, and -232
airplanes.

(d) Subject

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

(e) Reason

    This AD was prompted by a report that cracks were detected on
frame (FR)16 and FR20 web holes and passenger door intercostal
fitting holes at the door stop fitting locations, and a
determination that a certain compliance time needs to be clarified.
The FAA is issuing this AD to address cracking of the web holes at
the door stop fittings, which could affect the structural integrity
of the airplane.

(f) Compliance

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

(g) Requirements

    Except as specified in paragraph (h) of this AD: Comply with all
required actions and compliance times specified in, and in
accordance with, EASA AD 2018-0289R1.

(h) Exceptions to EASA AD 2018-0289R1

    (1) Where EASA AD 2018-0289R1 refers to its effective date, this
AD requires using the effective date of this AD.
    (2) The ``Remarks'' section of EASA AD 2018-0289R1 does not
apply to this AD.
    (3) Where Table 1 of EASA AD 2018-0289R1 refers to a compliance
time ``after 31 May 2017,'' this AD requires using a compliance time
after May 31, 2018 (the effective date of task 531103-01-1 in ``ALS
Part 2 rev. 6'').
    (4) Where paragraphs (3) and (6) of EASA AD 2018-0289R1 refers
to actions that have been done ``in accordance with Airbus Repair
Design Approval Sheet (RDAS),'' this AD includes repair done ``in
accordance with a method approved by the Manager, Large Aircraft
Section, International Validation Branch, FAA; or EASA; or Airbus
SAS's EASA Design Organization Approval (DOA). If approved by the
DOA, the approval must include the DOA-authorized signature.''
    (5) Where paragraph (3) of EASA AD 2018-0289R1 refers to
accomplishing the next due inspection of each repaired affected area
``within the compliance time as specified in, Airbus RDAS, as
applicable,'' for this AD use the applicable compliance time
specified in the repair ``approved by the Manager, Large Aircraft
Section, International Validation Branch, FAA; or EASA; or Airbus
SAS's EASA Design Organization Approval (DOA). If approved by the
DOA, the approval must include the DOA-authorized signature.''
    (6) Where condition ``A'' in Table 1 of EASA AD 2018-0289R1
specifies a compliance time of ``Before exceeding 30[,]000 FC since
aeroplane first flight,'' this AD requires, for the inspection at
frame 16 only, a compliance time of ``Before exceeding 30,000 flight
cycles since airplane's first flight, or within 30 days after the
effective date of this AD, whichever occurs later.''
    (7) If the actions in paragraph 3.C.(8) of the inspection
service bulletin referenced in EASA AD 2018-0289R1 specifies to
report all findings, this AD requires reporting if only the cracked
intercostal(s) that have been replaced using repair instruction
R53113118. Report results at the applicable time specified in
paragraph (h)(7)(i) or (ii) of this AD. If operators have reported
findings as part of obtaining any corrective actions approved by
Airbus SAS's European Aviation Safety Agency (EASA) Design
Organization Approval (DOA), operators are not required to report
those findings as specified in this paragraph.
    (i) If the inspection was done on or after the effective date of
this AD: Submit the report within 30 days after the inspection.
    (ii) If the inspection was done before the effective date of
this AD: Submit the report within 30 days after the effective date
of this AD.

(i) Additional AD Provisions

    The following provisions also apply to this AD:
    (1) Alternative Methods of Compliance (AMOCs): The Manager,
Large Aircraft Section, International Validation 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 responsible Flight
Standards Office, as appropriate. If sending information directly to
the Large Aircraft Section, International Validation Branch, send it
to the attention of the person identified in paragraph (j) of this
AD. Information may be emailed to: [email protected].
    (i) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the responsible Flight Standards Office.
    (ii) AMOCs approved previously for AD 2019-20-10 are approved as
AMOCs for the corresponding provisions of EASA AD 2018-0289R1 that
are required by paragraph (g) of this AD, except for those airplanes
having a compliance time specified in ``Table 1: Inspection
Thresholds,'' Row B, of EASA AD 2018-0289R1.
    (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, Large Aircraft
Section, International Validation Branch, FAA; or EASA; or Airbus
SAS's EASA Design Organization Approval (DOA). If approved by the
DOA, the approval must include the DOA-authorized signature.
    (3) Required for Compliance (RC): For any service information
referenced in EASA AD 2018-0289R1 that contains RC procedures and
tests: Except as required by paragraph (i)(2) of this AD, RC
procedures and tests must be done to comply with this AD; any
procedures or tests that are not identified as RC are recommended.
Those procedures and tests that are not identified 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 procedures and tests identified as
RC can be done and the airplane can be put back in an airworthy
condition. Any substitutions or changes to procedures or tests
identified as RC require approval of an AMOC.

(j) Related Information

    For more information about this AD, contact Sanjay Ralhan,
Aerospace Engineer, Large Aircraft Section, International Validation
Branch, FAA, 2200 South 216th St., Des Moines, WA 98198; telephone
and fax<PHONE_NUMBER>; email [email protected].

(k) 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) European Union Aviation Safety Agency (EASA) AD 2018-0289R1,
dated February 10, 2021.
    (ii) [Reserved]
    (3) For EASA AD 2018-0289R1, contact EASA, Konrad-Adenauer-Ufer
3, 50668 Cologne, Germany; telephone +49 221 8999 000; email
[email protected]; Internet www.easa.europa.eu. You may find this
EASA AD on the EASA website at https://ad.easa.europa.eu.
    (4) You may view this material at the FAA, Airworthiness
Products Section, Operational Safety Branch, 2200 South 216th St.,
Des Moines, WA. For information on the availability of this material
at the FAA, call<PHONE_NUMBER>.
    (5) You may view this material 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 protected], or go to: https://www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued on January 10, 2022.
Lance T. Gant,
Director, Compliance & Airworthiness Division, Aircraft Certification
Service.
[FR Doc. 2022-02554 Filed 2-7-22; 8:45 am]
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