[Federal Register Volume 83, Number 60 (Wednesday, March 28, 2018)]
[Notices]
[Pages 13330-13336]
[FR Doc No: 2018-06138]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82930; File No. SR-BOX-2018-10]

Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of Proposed Rule Change To Amend
IM-3120-2 of BOX Rule 3120 (Position Limits) To Increase the Position
Limits for Options on the Following Exchange Traded Funds: iShares
China Large-Cap ETF, iShares MSCI EAFE ETF, iShares MSCI Emerging
Markets ETF, iShares Russell 2000 ETF, iShares MSCI Brazil Capped ETF,
iShares 20+ Year Treasury Bond Fund ETF, PowerShares QQQ Trust, and
iShares MSCI Japan ETF

March 22, 2018.
    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 March 15, 2018, BOX Options Exchange LLC (the ``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 self-regulatory organization. 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 the
Substance of the Proposed Rule Change

    The Exchange proposes to amend BOX Rule 3120 (Position Limits) to
increase the position limits for options on the following exchange
traded funds (``ETFs''): iShares China Large-Cap ETF (``FXI''), iShares
MSCI EAFE ETF (``EFA''), iShares MSCI Emerging Markets ETF (``EEM''),
iShares Russell 2000 ETF (``IWM''), iShares MSCI Brazil Capped ETF
(``EWZ''), iShares 20+ Year Treasury Bond Fund ETF (``TLT''),
PowerShares QQQ Trust (``QQQQ''), and iShares MSCI Japan ETF (``EWJ'').
The text of the proposed rule change is available from the principal
office of the Exchange, at the Commission's Public Reference Room and
also on the Exchange's internet website at http://boxoptions.com.

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 self-regulatory organization
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 self-regulatory organization 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 IM-3120-2 to BOX Rule 3120 (Position
Limits) to increase the position limits for options on the following
exchange trade funds (``ETFs''): iShares China Large-Cap ETF (``FXI''),
iShares MSCI EAFE ETF (``EFA''), iShares MSCI Emerging Markets ETF
(``EEM''), iShares Russell 2000 ETF (``IWM''), iShares MSCI Brazil
Capped ETF (``EWZ''), iShares 20+ Year Treasury Bond Fund ETF
(``TLT''), PowerShares QQQ Trust (``QQQQ''), and iShares MSCI Japan ETF
(``EWJ'').This is a competitive filing that is based on a proposal
recently submitted by the Chicago Board Options Exchange Incorporated
(``CBOE'') and approved by the Commission.\3\
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    \3\ See Securities Exchange Act Release No. 82770 (February 23,
2018), 83 FR 8907 (March 1, 2018)(Order Granting Accelerated
Approval SR-SR-CBOE-2017-057).
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    Position limits are designed to address potential manipulative
schemes and adverse market impact surrounding the use of options, such
as disrupting the market in the security underlying the options. The
potential manipulative schemes and adverse market impact are balanced
against the potential of setting the limits so low as to discourage
participation in the options market. The level of those position limits
must be balanced between curtailing potential manipulation and the cost
of preventing potential hedging activity that could be used for
legitimate economic purposes. Position limits for options on ETFs, such
as those subject to this proposal, are determined pursuant to BOX Rule
3120, and vary according to the number of outstanding shares and the
trading volume of the underlying stocks or ETFs over the past six-
months. Pursuant to BOX Rule 3120, the largest in capitalization and
the most frequently traded stocks and ETFs have an option position
limit of 250,000 contracts (with adjustments for splits, re-
capitalizations, etc.) on the same side of the market; and smaller
capitalization stocks and ETFs have position limits of 200,000, 75,000,
50,000 or 25,000 contracts (with adjustments for splits, re-
capitalizations, etc.) on the same side of the market. Options on FXI,
EFA, EWZ, TLT, and EWJ are currently subject to the standard position
limit of 250,000 contracts as set forth in BOX Rule 3120.\4\ IM-3120-2
of BOX Rule 3120 sets forth separate position limits for options on
specific ETFs as follows:
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    \4\ See https://www.theocc.com/webapps/delo-search.
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     Options on EEM are 500,000 contracts;
     Options on IWM are 500,000 contracts; and
     Options on QQQQ are 900,000 contracts.
    The purpose of this proposal is to amend IM-3120-2 to BOX Rule 3120
to double the position and exercise limits for FXI, EEM, IWM, EFA, EWZ,
TLT, QQQQ, and EWJ.\5\ As such, options on FXI, EFA, EWZ, TLT, and EWJ
would no longer be subject to the standard position limits set forth
under BOX Rule 3120. Accordingly, IM-3120-2 would be amended to set
forth that the position limits for options on FXI, EFA, EWZ, TLT, and
EWJ would be 500,000 contracts. These position limits equal the current
position limits for option on IWM and EMM and are similar to the
current position limit for options on QQQQ set forth in IM-3120-2. IM-
3120-2 would be further amended to increase the position limits for the
remaining options subject to this proposal as follows:
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    \5\ By virtue of IM-3140-1 of BOX Rule 3140, which is not being
amended by this filing, the exercise limit for FXI, EEM, IWM, EFA,
EWZ, TLT, QQQQ, and EWJ options would be similarly increased. The
Exchange notes that it also proposes to make non-substantive
corrections to the names of IWM and EEM in IM-3120-2.
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     The position limits for options on EEM would be increased
from 500,000 contracts to 1,000,000 contracts;
     The position limits on options on IWM would be increased
from 500,000 contracts to 1,000,000 contracts; and
     The position limits on options on QQQQ would be increased
from 900,000 contracts to 1,800,000 contracts.
    In support of this proposal, the Exchange represents that the above
listed ETFs qualify for either: (i) The initial listing criteria set
forth in Exchange Rule 5020(h)(2) for ETFs holding non-U.S. component
securities; or (ii) for ETFs listed pursuant to generic listing
standards for series of portfolio depository receipts and index fund
shares based on international or global indexes under which a
comprehensive surveillance agreement (``CSA'') is not required.\6\ FXI
tracks the performance of the FTSE China 50 Index, which is composed of
the 50 largest Chinese stocks.\7\ EEM tracks the performance of the
MSCI Emerging Markets Index, which is composed of approximately 800
component securities.\8\ ``The MSCI Emerging Markets Index consists of
the following 21 emerging market country indices: Brazil, Chile, China,
Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea,
Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South
Africa, Taiwan, Thailand, and Turkey.'' \9\ IWM tracks the performance
of the Russell 2000 Index, which is composed of 2,000 small-cap
domestic stocks.\10\ EFA tracks the performance of MSCI EAFE Index,
which has over 900 component securities.\11\ ``The MSCI EAFE Index is
designed to represent the performance of large and mid-cap securities
across 21 developed markets, including countries in Europe, Australasia
and the Far East, excluding the U.S. and Canada.'' \12\ EWZ tracks the
performance of the MSCI Brazil 25/50 Index, which is composed of shares
of large and mid-size companies in Brazil.\13\ TLT tracks the
performance of ICE U.S. Treasury 20+ Year Bond Index, which is composed
of long-term U.S. Treasury bonds.\14\ QQQQ tracks the performance of
the Nasdaq-100 Index, which is composed of 100 of the largest domestic
and international nonfinancial companies listed on the Nasdaq Stock
Market LLC (``Nasdaq'').\15\ EWJ tracks the MSCI Japan Index, which
tracks the performance of large and mid-sized companies in Japan.\16\
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    \6\ The Exchange notes that the initial listing criteria for
options on ETFs that hold non-U.S. component securities are more
stringent than the maintenance listing criteria for those same ETF
options. See BOX Rule 5020(h)(2); BOX Rule 5030(h).
    \7\ See https://www.ishares.com/us/products/239536/ishares-china-largecap-etf.
    \8\ See http://us.ishares.com/product_info/fund/overview/EEM.htm.
    \9\ See http://www.msci.com/products/indices/tools/index.html#EM.
    \10\ See https://www.ishares.com/us/products/239710/ishares-russell-2000-etf.
    \11\ See https://www.ishares.com/us/products/239623/.
    \12\ See https://www.msci.com/eafe.
    \13\ See https://www.ishares.com/us/products/239612/ishares-msci-brazil-capped-etf.
    \14\ See https://www.ishares.com/us/products/239454/.
    \15\ See https://www.invesco.com/portal/site/us/financial-professional/etfs/productdetail?productId=QQQ&ticker=QQQ&title=powershares-qqq.
    \16\ See https://www.ishares.com/us/products/239665/EWJ.
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    BOX represents that more than 50% of the weight of the securities
held by the options subject to this proposal are also subject to a
CSA.\17\ Additionally,

the component securities of the MSCI Emerging Markets Index on which
EEM is based for which the primary market is in any one country that is
not subject to a CSA do not represent 20% or more of the weight of the
MSCI Emerging Markets Index.\18\ Finally, the component securities of
the MSCI Emerging Markets Index on which EEM is based, for which the
primary market is in any two countries that are not subject to CSAs do
not represent 33% of more of the weight of the MSCI Emerging Markets
Index.\19\
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    \17\ See BOX Rule 5020(h)(2).
    \18\ See BOX Rule 5020(h)(2)(ii)(B).
    \19\ See BOX Rule 5020(h)(2)(ii)(C).
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    According to CBOE, market participants have increased their demand
for options on FXI, EFA, EWZ, TLT, and EWJ for hedging and trading
purposes and the Exchange believes the current position limits are too
low and may be a deterrent to successful trading of options on these
securities.\20\ CBOE has collected the following trading statistics on
the ETFs that are subject to this proposal:
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    \20\ See supra note 3.
    \21\ SPY is included here for comparison purposes.

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                                                     2017 ADV        2017 ADV         Shares
                       ETF                           (million         (option       outstanding     Fund market
                                                      shares)       contracts)       (million)    cap ($million)
----------------------------------------------------------------------------------------------------------------
FXI.............................................           15.08          71,944            78.6        $3,343.6
EEM.............................................           52.12         287,357           797.4        34,926.1
IWM.............................................           27.46         490,070           253.1        35,809.1
EFA.............................................           19.42          98,844          1178.4        78,870.3
EWZ.............................................           17.08          95,152           159.4         6,023.4
TLT.............................................            8.53          80,476            60.0         7,442.4
QQQQ............................................           26.25         579,404           351.6        50,359.7
EWJ.............................................            6.06           4,715           303.6        16,625.1
SPY \21\........................................           64.63       2,575,153          976.23       240,540.0
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    The following analysis was conducted by CBOE in support of its
proposal. BOX agrees with CBOE's analysis discussed below.
    In support of its proposal to increase the position limits for QQQQ
to 1,800,000 contracts, CBOE compared the trading characteristics of
QQQQ to that of the SPDR S&P 500 ETF (``SPY''), which has no position
limits. As shown in CBOE's above table, the average daily trading
volume through August 14, 2017 for QQQQ was 26.25 million shares
compared to 64.63 million shares for SPY. The total shares outstanding
for QQQQ are 351.6 million compared to 976.23 million for SPY. The fund
market cap for QQQQ is $50,359.7 million compared to $240,540 million
for SPY. SPY is one of the most actively trading ETFs and is,
therefore, subject to no position limits. QQQQ is also very actively
traded, and while not to the level of SPY, should be subject to the
proposed higher position limits based its trading characteristics when
compared to SPY. The proposed position limit coupled with QQQQ's
trading behavior would continue to address potential manipulative
schemes and adverse market impact surrounding the use of options and
trading in its [sic] underlying the options.
    In support of its proposal to increase the position limits for EEM
and IWM from 500,000 contracts to 1,000,000 contracts, CBOE also
compared the trading characteristics of EEM and IWM to that of QQQQ,
which currently has a position limit of 900,000 contracts. As shown in
the above table, the average daily trading volume through July 31, 2017
for EEM was 52.12 million shares and IWM was 27.46 million shares
compared to 26.25 million shares for QQQQ. The total shares outstanding
for EEM are 797.4 million and for IWM are 253.1 million compared to
351.6 million for QQQQ. The fund market cap for EEM is $34,926.1
million and IWM is $35,809 million compared to $50,359.7 million for
QQQQ. EEM, IWM and QQQQ have similar trading characteristics and
subjecting EEM and IWM to the proposed higher position limit would
continue be designed to address potential manipulate [sic] schemes that
may arise from trading in the options and their underlying securities.
These above trading characteristics for QQQQ when compared to EEM and
IWM also justify increasing the position limit for QQQQ. QQQQ has a
higher options ADV than EEM and IWM, a higher numbers [sic] of shares
outstanding than IWM and a much higher market cap than EEM and IWM
which justify doubling the position limit for QQQQ. Based on these
statistics, and as stated above, the proposed position limit coupled
with QQQQ's trading behavior would continue to address potential
manipulative schemes and adverse market impact surrounding the use of
options and trading in the securities underlying the options.
    In support of its proposal to increase the position limits for FXI,
EFA, EWZ, TLT, and EWJ from 250,000 contracts to 500,000 contracts,
CBOE compared the trading characteristics of FXI, EFA, EWZ, TLT and EWJ
to that of EEM and IWM, both of which currently have a position limit
of 500,000 contracts. As shown in the above table, the average daily
trading volume through July 31, 2017 for FXI is 15.08 million shares,
EFA is 19.42 million shares, EWZ is 17.08 million shares, TLT is 8.53
million shares, and EWJ is 6.06 million shares compared to 52.12
million shares for EEM and 27.46 million shares for IWM. The total
shares outstanding for FXI is 78.6 million, EFA is 1178.4 million, EWZ
is 159.4 million, TLT is 60 million and EWJ is 303.6 million compared
to 797.4 million for EEM and 253.1 million for IWM. The fund market cap
for FXI is $3,343.6 million, EFA is $78,870.3 million, EWZ is $6,023.4
million, TLT is $7,442.4 million,, and EWJ is $16,625.1 million
compared to $34,926.1 million for EEM and $35,809.1 million for IWM.
The above trading characteristics of FXI, EFA, EWZ, TLT and EWJ is
either similar to that of EEM and IWM or sufficiently active enough so
that the proposed limit would continue to address potential
manipulative [sic] that may arise. EFA has far more shares outstanding
and a larger fund market cap than EEM, IWM, and QQQQ. EWJ has a more
shares outstanding than IWM and only slightly less shares outstanding
than QQQQ.
    On the other hand, while FXI, EWZ, and TLT do not exceed EEM, IWM
or QQQQ is any of the specified areas, they are all actively trading so
that market participant's trading activity has been impacted by them
being restricted by the current position limits. The Exchange believes
that the trading activity and these securities being based on a broad
basket of underlying

securities alleviates any potential manipulative activity that may
arise. In addition, as discussed in more detail below, the Exchange's
existing surveillance procedures and reporting requirements at the
Exchange, other options exchanges, and at several clearing firms are
capable of properly identifying unusual and/or illegal trading
activity.
    According to CBOE, market participants' trading activity has been
adversely impacted by the current position limits for FXI, EFA, EWZ,
TLT, and EWJ and such limits have caused options trading in these
symbols to move from exchanges to the over-the-counter market. The
Exchange understands that certain market participants wishing to make
trades involving a large number of options contracts in the symbols
subject to the proposal are opting to execute those trades in the over-
the-counter market. The over-the-counter transactions occur via bi-
lateral agreements, the terms of which are not publicly disclosed to
other market participants. Therefore, these large trades do not
contribute to the price discovery process performed on a lit market.
    The Exchange notes that the ETFs that underlie options subject to
this proposal are highly liquid, and are based on a broad set of highly
liquid securities and other reference assets.\22\ The Exchange notes
that the Commission has generally looked through to the liquidity of
securities comprising an index in establishing position limits for
cash-settled index options. The Exchange further notes that options on
certain broad-based security indexes have no position limits. Likewise,
the Commission has recognized the liquidity of the securities
comprising the underlying interest of the SPDR S&P 500 ETF (``SPY'') in
permitting no position limits on SPY options since 2012,\23\ and
expanded position limits for options on EEM, IWM, and QQQQ.
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    \22\ See supra providing trading statistics for each ETF.
    \23\ See Securities Exchange Act Release No. 67936 (September
27, 2012), 77 FR 60491 (October 3, 2012) (SR-BOX-2012-013).
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    The proposed position limits set forth in the proposal would
continue to address potential manipulative activity while allowing for
potential hedging activity for appropriate economic purposes. The
creation and redemption process for these ETFs also lessen the
potential for manipulative activity. When an ETF company wants to
create more ETF shares, it looks to an Authorized Participant, which is
a market maker or other large financial institution, to acquire the
securities the ETF is to hold. For instance, IWM is designed to track
the performance of the Russell 2000 Index, the Authorized Participant
will purchase all the Russell 2000 constituent securities in the exact
same weight as the index, then deliver those shares to the ETF
provider. In exchange, the ETF provider gives the Authorized
Participant a block of equally valued ETF shares, on a one-for-one fair
value basis. The price is based on the net asset value, not the market
value at which the ETF is trading. The creation of new ETF units can be
conducted all trading day and is not subject to position limits. This
process can also work in reverse where the ETF company seeks to
decrease the number of shares that are available to trade. The creation
and redemption process, therefore, creates a direct link to the
underlying components of the ETF, and serves to mitigate potential
price impact of the ETF shares that might otherwise result from
increased position limits.
    The ETF creation and redemption seeks to keep ETF share prices
trading in line with the ETF's underlying net asset value. Because an
ETF trades like a stock, its price will fluctuate during the trading
day, due to simple supply and demand. If demand to buy an ETF is high,
for instance, the ETF's share price might rise above the value of its
underlying securities. When this happens, the Authorized Participant
believes the ETF may now be overpriced, and can buy the underlying
shares that compose the ETF and then sell ETF shares on the open
market. This should help drive the ETF's share price back toward fair
value. Likewise, if the ETF starts trading at a discount to the
securities it holds, the Authorized Participant can buy shares of the
ETF and redeem them for the underlying securities. Buying undervalued
ETF shares should drive the price of the ETF back toward fair value.
This arbitrage process helps to keep an ETF's price in line with the
value of its underlying portfolio.
    Some of the ETFs underlying options subject to the proposal are
based on broad-based indices that underlie cash settled options that
are economically equivalent to the ETF options that are the subject of
the proposal and have no position limits. Other ETFs are based on
broad-based indexes that underlie cash-settled options with position
limits reflecting notional values that are larger than the current
position limits for ETF analogues (EEM, EFA). Where there was no
approved index analogue, the Exchange believes, based on the liquidity,
breadth and depth of the underlying market, that the index referenced
by the ETF would be considered a broad-based index.\24\ The Exchange
argues that if certain position limits are appropriate for the options
overlying the same index or is an analogue to the basket of securities
that the ETF tracks, then those same economically equivalent position
limits should be appropriate for the option overlying the ETF. In
addition, the market capitalization of the underlying index or
reference asset is large enough to absorb any price movements that may
be caused by an oversized trade. Also, the Authorized Participant or
issuer may look to the stocks comprising the analogous underlying index
or reference asset when seeking to create additional ETF shares are
part of the creation/redemption process to address supply and demand or
to mitigate the price movement the price of the ETF.
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    \24\ See BOX Rule 6040, which sets forth the position limits for
broad-based index options.
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    For example, the PowerShares QQQ Trust or QQQQ is an ETF that
tracks the Nasdaq 100 Index or NDX, which is an index composed of 100
of the largest non-financial securities listed on the Nasdaq Stock
Market LLC (``Nasdaq''). Options on NDX are currently subject to the
standard position limit of 25,000 contracts for broad-based index
options but share similar trading characteristics as QQQQ.\25\ Based on
QQQQ's share price of $154.54 \26\ and NDX's index level of 6,339.14,
approximately 40 contracts of QQQQ equals one contract of NDX. Based on
the above comparison of notional values, this would result in a
position limit equivalent to 1,000,000 contracts for QQQQ as NDX's
analogue. NDX is subject to the standard position limit of 25,000
contracts for broad-based index options and has an average daily
trading volume of 15,300 contracts. QQQQ is currently subject to a
position limit of 900,000 contracts but has a much higher average daily
trading volume of 579,404 contracts. Furthermore, NDX currently has a
market capitalization of $17.2 trillion and QQQQ has a market
capitalization of $50,359.7 million, and the component securities of
NDX, in aggregate, have traded an average of 440 million shares per day
in 2017, both large enough to absorb any price movement caused by a
large trade in the QQQQ. The Exchange notes that other exchanges allow
no position limits for NDX,\27\ although it has a much lower

average daily trading volume than its analogue, the QQQQ. Therefore,
the Exchange believes it is reasonable to increase the position limit
for options on the QQQQ from 900,000 to 1,800,000 contracts.
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    \25\ Id.
    \26\ All share prices used herein are based on the closing price
of the security on November 16, 2017. Source: Yahoo Finance.
    \27\ See CBOE Rule 24.4 sets forth the position limits for
broad-based index options.
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    The iShare [sic] Russell 2000 ETF or IWM, is an ETF that also
tracks the Russell 2000 Index or RUT, which is an index that composed
of 2,000 small-cap domestic companies in the Russell 3000 index.
Options on RUT are currently subject to the standard position limit of
25,000 contracts for broad-based index options but share similar
trading characteristics as IWM.\28\ Based on IWM's share price of
$144.77 and RUT's index level of 1,486.88, approximately 10 contracts
of IWM equals one contract of RUT. Based on the above comparison of
notional values, this would result in a position limit equivalent to
250,000 contracts for IWM as RUT's analogue. The Exchange notes that at
other exchanges RUT is not subject to position limits and has an
average daily trading volume of 66,200 contracts.\29\ IWM is currently
subject to a position limit of 500,000 contracts but has a much higher
average daily trading volume of 490,070 contracts. As mentioned above,
other exchanges have no position limits for RUT,\30\ although it has a
much lower average daily trading volume than its analogue, the IWM.
Furthermore, RUT currently has a market capitalization of $2.4 trillion
and IWM has a market capitalization of $35,809.1 million, and the
component securities of RUT, in aggregate, have traded an average of
270 million shares per day in 2017, both large enough to absorb any
price movement cause by a large trade in the IWM. Therefore, the
Exchange believes it is reasonable to increase the position limit for
options on the IWM from 500,000 to 1,000,000 contracts.
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    \28\ See BOX Rule 6040, which sets forth the position limits for
broad-based index options.
    \29\ See CBOE Rule 24.4.
    \30\ Id.
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    EEM tracks the performance of the MSCI Emerging Markets Index or
MXEF, which is composed of approximately 800 component securities
following 21 emerging market country indices: Brazil, Chile, China,
Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Korea,
Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South
Africa, Taiwan, Thailand, and Turkey. Below makes the same notional
value comparison as made above. Based on EEM's share price of $47.06
and MXEF's index level of 1,136.45, approximately 24 contracts of EEM
equals one contract of MXEF. MXEF is currently subject to the standard
position limit of 25,000 contracts for broad-based index options under
BOX Rule 6040(a). Based on the above comparison of notional values,
this would result in a position limit economically equivalent to
604,000 contracts for EEM as MXEF's analogue. However, MXEF has an
average daily trading volume of 180 contracts. EEM is currently subject
to a position limit of 500,000 contracts but has a much higher average
daily trading volume of 287,357 contracts. Furthermore, MXEF currently
has a market capitalization of $5.18 trillion and EEM has a market
capitalization of $34,926.1 million, and the component securities of
MXEF, in aggregate, have traded an average of 33.6 billion shares per
day in 2017, both large enough to absorb any price movement cause by a
large trade in the EEM. Therefore, based on the comparison of average
daily trading volume, the Exchange believes it is reasonable to
increase the position limit for options on the EEM from 500,000 to
1,000,000 contracts.
    EFA tracks the performance of MSCI EAFE Index or MXEA, which has
over 900 component securities designed to represent the performance of
large and mid-cap securities across 21 developed markets, including
countries in Europe, Australasia and the Far East, excluding the U.S.
and Canada. Below makes the same notional value comparison as made
above. Based on EFA's share price of $69.16 and MXEA's index level of
1,986.15, approximately 29 contracts of EFA equals one contract of
MXEA. MXEA is currently subject to the standard position limit of
25,000 contracts for broad-based index options under BOX Rule 6040(a).
Based on the above comparison of notional values, this would result in
a position limit economically equivalent to 721,000 contracts for EFA
as MXEA's analogue. Furthermore, MXEA currently has a market
capitalization of $18.7 trillion and EFA has a market capitalization of
$78,870.3 million, and the component securities of MXEA, in aggregate,
have traded an average of 4.6 billion shares per day in 2017, both
large enough to absorb any price movement cause by a large trade in the
EEM. However, MXEA has an average daily trading volume of 270
contracts. EFA is currently subject to a position limit of 250,000
contracts but has a much higher average daily trading volume of 98,844
contracts. Based on the above comparisons, the Exchange believes it is
reasonable to increase the position limit for options on the EFA from
250,000 to 500,000 contracts.
    FXI tracks the performance of the FTSE China 50 Index, which is
composed of the 50 largest Chinese stocks. There is currently no index
analogue for FXI approved for options trading. However, the FTSE China
50 Index currently has a market capitalization of $1.7 trillion and FXI
has a market capitalization of $2,623.18 million, both large enough to
absorb any price movement cause by a large trade in FXI. The components
of the FTSE China 50 Index, in aggregate, have an average daily trading
volume of 2.3 billion shares. FXI is currently subject to a position
limit of 000 contracts but has a much higher average daily trading
volume of 15.08 million shares. Based on the above comparisons, the
Exchange believes it is reasonable to increase the position limit for
options on the FXI from 250,000 to 500,000 contracts.
    EWZ tracks the performance of the MSCI Brazil 25/50 Index, which is
composed of shares of large and mid-size companies in Brazil. There is
currently no index analogue for EWZ approved for options trading.
However, the MSCI Brazil 25/50 Index currently has a market
capitalization of $700 billion and EWZ has a market capitalization of
$6,023.4 million, both large enough to absorb any price movement cause
by a large trade in EWZ. The components of the MSCI Brazil 25/50 Index,
in aggregate, have an average daily trading volume of 285 million
shares. EWZ is currently subject to a position limit of 250,000
contracts but has a much higher average daily trading volume of 17.08
million shares. Based on the above comparisons, the Exchange believes
it is reasonable to increase the position limit for options on the EWZ
from 250,000 to 500,000 contracts.
    TLT tracks the performance of ICE U.S. Treasury 20+ Year Bond
Index, which is composed of long-term U.S. Treasury bonds. There is
currently no index analogue for TLT approved for options trading.
However, the U.S. Treasury market is one of the largest and most liquid
markets in the world, with over $14 trillion outstanding and turnover
of approximately $500 billion per day. TLT currently has a market
capitalization of $7,442.4 million, both large enough to absorb any
price movement cause by a large trade in TLT. Therefore, the potential
for manipulation will not increase solely due the increase in position
limits as set forth in this proposal. Based on the above comparisons,
the Exchange believes it is reasonable to increase the position limit
for options on the TLT from 250,000 to 500,000 contracts.
    EWJ tracks the MSCI Japan Index, which tracks the performance of
large and mid-sized companies in Japan. There is currently no index
analogue for

EWJ approved for options trading. However, the MSCI Japan Index has a
market capitalization of $3.5 trillion and EWJ has a market
capitalization of $16,625.1 million, and the component securities of
the MSCI Japan Index, in aggregate, have traded an average of 1.1
billion shares per day in 2017, both large enough to absorb any price
movement cause by a large trade in EWJ. EWJ is currently subject to a
position limit of 250,000 contracts and has an average daily trading
volume of 6.6 million shares. Based on the above comparisons, the
Exchange believes it is reasonable to increase the position limit for
options on EWJ from 250,000 to 500,000 contracts.
    The Exchange believes that increasing the position limits for the
options subject to this proposal would lead to a more liquid and
competitive market environment for these options, which will benefit
customers interested in this product. Under the proposal, the reporting
requirement for the above options would be unchanged. Thus, the
Exchange would still require that each BOX Participant that maintains a
position in the options on the same side of the market, for its own
account or for the account of a customer, report certain information to
the Exchange. This information would include, but would not be limited
to, the options' position, whether such position is hedged and, if so,
a description of the hedge, and the collateral used to carry the
position, if applicable. Exchange Market Makers \31\ would continue to
be exempt from this reporting requirement, as Market Maker information
can be accessed through the Exchange's market surveillance systems.\32\
In addition, the general reporting requirement for customer accounts
that maintain an aggregate position of 200 or more options contracts
would remain at this level for the options subject to this
proposal.\33\
---------------------------------------------------------------------------

    \31\ A Market Maker ``is an Options Participant registered with
the Exchange for the purpose of making markets in options contracts
traded on the Exchange and that is vested with the rights and
responsibilities specified in the Rule 8000 Series. All Market
Makers are designated as specialists on the Exchange for all
purposes under the Exchange Act or Rules thereunder.'' See BOX Rule
100(a)(31).
    \32\ The Exchange notes that the Financial Industry Regulatory
Authority (``FINRA''), pursuant to a regulatory services agreement,
operates surveillance on behalf of BOX. This type of Market Maker
information can be found through FINRA.
    \33\ See BOX Rule 3150 for reporting requirements.
---------------------------------------------------------------------------

    The Exchange believes that the existing surveillance procedures and
reporting requirements at the Exchange, other options exchanges, and at
the several clearing firms are capable of properly identifying unusual
and/or illegal trading activity. In addition, routine oversight
inspections of the Exchange's regulatory programs by the Commission
have not uncovered any material inconsistencies or shortcomings in the
manner in which the Exchange's market surveillance is conducted. These
procedures utilize daily monitoring of market movements via automated
surveillance techniques to identify unusual activity in both options
and underlying stocks.\34\
---------------------------------------------------------------------------

    \34\ These procedures have been effective for the surveillance
of trading the options subject to this proposal and will continue to
be employed by FINRA on behalf of BOX.
---------------------------------------------------------------------------

    Furthermore, large stock holdings must be disclosed to the
Commission by way of Schedules 13D or 13G.\35\ The positions for
options subject to this proposal are part of any reportable positions
and, thus, cannot be legally hidden. Moreover, the Exchange's
requirement that BOX Participants file reports with the Exchange for
any customer who held aggregate large long or short positions of any
single class for the previous day will continue to serve as an
important part of the Exchange's surveillance efforts.\36\
---------------------------------------------------------------------------

    \35\ 17 CFR 240.13d-1.
    \36\ The Exchange again notes that these surveillance efforts
are carried out by FINRA on behalf of BOX.
---------------------------------------------------------------------------

    The Exchange believes that the current financial requirements
imposed by the Exchange and by the Commission adequately address
concerns that a BOX Participant or its customer may try to maintain an
inordinately large un-hedged position in the options subject to this
proposal. Current margin and risk-based haircut methodologies serve to
limit the size of positions maintained by any one account by increasing
the margin and/or capital that a BOX Participant must maintain for a
large position held by itself or by its customer.\37\ In addition, Rule
15c3-1 \38\ imposes a capital charge on BOX Participants to the extent
of any margin deficiency resulting from the higher margin requirement.
---------------------------------------------------------------------------

    \37\ See BOX Rule 10100 Series for a description of margin
requirements.
    \38\ 17 CFR 240.15c3-1.
---------------------------------------------------------------------------

2. Statutory Basis

    The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Securities Exchange Act of 1934
(the ``Act''),\39\ in general, and Section 6(b)(5) of the Act,\40\ in
particular, in that it is 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 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. The current position limits for the options subject to
this proposal have inhibited the ability of Market Makers to make
markets on the Exchange. Specifically, the proposal is designed to
encourage Market Makers to shift liquidity from over the counter
markets onto the Exchange, which will enhance the process of price
discovery conducted on the Exchange through increased order flow. The
proposal will also benefit institutional investors as well as retail
traders, and public customers, by providing them with a more effective
trading and hedging vehicle. In addition, the Exchange believes that
the structure of the ETFs subject to this proposal and the considerable
liquidity of the market for options on those ETFs diminishes the
opportunity to manipulate this product and disrupt the underlying
market that a lower position limit may protect against.
---------------------------------------------------------------------------

    \39\ 15 U.S.C. 78f(b).
    \40\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    Increased position limits for select actively traded options, such
as that proposed herein, is not novel and has been previously approved
by the Commission. For example, the Commission has previously approved,
on a pilot basis, eliminating position limits for options on SPY.\41\
Additionally, the Commission has approved similar proposed rule changes
to increase position limits for options on highly liquid, actively-
traded ETFs,\42\ including a proposal to permanently eliminate the
position and exercise limits for options overlaying the S&P 500 Index,
S&P 100 Index, Dow Jones Industrial Average, and Nasdaq 100 Index.\43\
In approving the permanent elimination of position and exercise limits,
the Commission relied heavily upon CBOE's surveillance capabilities,
the Commission expressed trust in the enhanced surveillance and
reporting

safeguards that CBOE took in order to detect and deter possible
manipulative behavior which might arise from eliminating position and
exercise limits.\44\ Furthermore, as described more fully above,
options on other ETFs have the position limits proposed herein, but
their trading volumes are significantly lower than the ETFs subject to
the proposed rule change.
---------------------------------------------------------------------------

    \41\ See Securities Exchange Act Release Nos. 67672 (August 15,
2012), 77 FR 50750 (August 22, 2012)(SR-NYSEAmex-2012-29); 67937
(September 27, 2012), 77 FR 60489 (October 3, 2012) (SR-CBOE-2012-
091); 67936 (September 27, 2012), 77 FR 60491 (October 3, 2012) (SR-
BOX-2012-013).
    \42\ See Securities Exchange Act Release Nos. 68086 (October 23,
2012), 77 FR 65600 (October 29, 2012)(SR-CBOE-2012-066); 64928 (July
20, 2011), 76 FR 44633 (July 26, 2011) (SR-CBOE-2011-065); 64695
(June 17, 2011), 76 FR 36942 (June 23, 2011) (SR-PHLX-2011-58); and
55155 (January 23, 2007), 72 FR 4741 (February 1, 2017) (SR-CBOE-
2007-008.).
    \43\ See Securities Exchange Act Release Nos. 44994 (October 26,
2001), 66 FR 55722 (November 2, 2001) (SR-CBOE-2001-22); 52650
(October 21, 2005), 70 FR 62147 (October 28, 2005) (SR-CBOE-2005-41)
(``NDX Approval'').
    \44\ See NDX Approval at 62149.
---------------------------------------------------------------------------

    Lastly, the Commission expressed the belief that removing position
and exercise limits may bring additional depth and liquidity without
increasing concerns regarding intermarket manipulation or disruption of
the options or the underlying securities.\45\ The Exchange believes
that BOX's enhanced surveillance and reporting safeguards continue to
be designed to deter and detect possible manipulative behavior which
might arise from eliminating position and exercise limits.
---------------------------------------------------------------------------

    \45\ Id.
---------------------------------------------------------------------------

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. The Exchange believes that the
proposed rule change will result in additional 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.
    Further, the Exchange notes that the rule change is being proposed
as a competitive response to a filing submitted by CBOE that was
recently approved by the Commission.\46\
---------------------------------------------------------------------------

    \46\ See supra, note 3.
---------------------------------------------------------------------------

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

    The Exchange has neither solicited nor received comments on the
proposed rule change.

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

    Because the proposed rule change does not (i) significantly affect
the protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative for 30
days from the date on which it was filed, or such shorter time as the
Commission may designate, it has become effective pursuant to Section
19(b)(3)(A) of the Act \47\ and Rule 19b-4(f)(6) thereunder.\48\
---------------------------------------------------------------------------

    \47\ 15 U.S.C. 78s(b)(3)(A).
    \48\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written
notice of its intent to file the proposed rule change, along with a
brief description and the text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission.
---------------------------------------------------------------------------

    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \49\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \50\ 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 so that
the proposed rule change may become operative upon filing. The Exchange
states that waiver of the operative delay would be consistent with the
protection of investors and the public interest because it will ensure
fair competition among the exchanges by allowing the Exchange to
immediately increase the position limits for the products subject to
this proposal, which the Exchange believes will provide consistency for
BOX Participants that are also members at CBOE where these increased
position limits are currently in place. The Commission believes that
waiving the 30-day operative delay is consistent with the protection of
investors and the public interest. Therefore, the Commission hereby
waives the operative delay and designates the proposal as operative
upon filing.\51\
---------------------------------------------------------------------------

    \49\ 17 CFR 240.19b-4(f)(6).
    \50\ 17 CFR 240.19b-4(f)(6)(iii).
    \51\ 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).
---------------------------------------------------------------------------

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

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-BOX-2018-10 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-BOX-2018-10. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of such filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-BOX-2018-10, and should be submitted on
or before April 18, 2018.
---------------------------------------------------------------------------

    \52\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\52\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-06138 Filed 3-27-18; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 78, Number 91 (Friday, May 10, 2013)]
[Notices]
[Pages 27402-27404]
[FR Doc No: 2013-11126]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2012-N-1181]

Agency Information Collection Activities; Submission for Office
of Management and Budget Review; Comment Request; Medicated Feed Mill
License Application; Extension

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration (FDA) is announcing that a
proposed collection of information has been submitted to the Office of
Management and Budget (OMB) for review and clearance under the
Paperwork Reduction Act of 1995.

DATES: Fax written comments on the collection of information by June
10, 2013.

ADDRESSES: To ensure that comments on the information collection are
received, OMB recommends that written comments be faxed to the Office
of Information and Regulatory Affairs, OMB, Attn: FDA Desk Officer,
FAX:<PHONE_NUMBER>, or emailed to<EMAIL_ADDRESS>All
comments should be identified with the OMB control number 0910-0337.
Also include the FDA docket number found in brackets in the heading of
this document.

FOR FURTHER INFORMATION CONTACT: Jonna Capezzuto, Office of Information
Management, Food and Drug Administration, 1350 Piccard Dr., PI50-400B,
Rockville, MD 20850,<PHONE_NUMBER><EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: In compliance with 44 U.S.C. 3507, FDA has
submitted the following proposed collection of information to OMB for
review and clearance.

Medicated Feed Mill Licensing Application--21 CFR Part 515 (OMB Control
Number 0910-0337)--Extension

    The Animal Drug Availability Act (ADAA) of October 9, 1996, amended
section 512 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
360b) to replace the system for the approval of specific medicated feed
with a general licensing system for feed mills. Before passage of the
ADAA, medicated feed manufacturers were required to obtain approval of
Medicated Feed Applications (MFAs) in order to manufacture certain
types of medicated feeds. An individual approved MFA was required for
each and every applicable medicated feed. The ADAA streamlined the
paperwork process for gaining approval to manufacture medicated feeds
by replacing the MFA system with a facility license for each medicated
feed manufacturing facility. Implementing regulations are at 21 CFR
part 515.
    In the Federal Register of December 21, 2012 (77 FR 75635), FDA
published a 60-day notice requesting public comment on the proposed
collection of information. One comment was received; however, it was
unrelated to the information collection.
    FDA estimates the burden of this collection of information as
follows:

                                 Table 1--Estimated Annual Reporting Burden \1\
----------------------------------------------------------------------------------------------------------------
                                                   Number of
  21 CFR Section and activity      Number of     responses per   Total annual    Average burden     Total hours
                                  respondents     respondent       responses      per response
----------------------------------------------------------------------------------------------------------------
Medicated Feed Mill License                 20               1              20  0.25............               5
 Application Using Form FDA                                                     (15 minutes)....
 3448 (515.10(b)).
Supplemental Feed Mill License              40               1              40  0.25............              10
 Application Using Form FDA                                                     (15 minutes)....
 3448 (515.11(b)).
Voluntary Revocation of                     40               1              40  0.25............              10
 Medicated Feed Mill License                                                    (15 minutes)....
 (515.23).
Filing a Request for a Hearing               1               1               1  4...............               4
 on Medicated Feed Mill
 License (515.30(c)).
                               ---------------------------------------------------------------------------------
    Total.....................  ..............  ..............  ..............  ................              29
----------------------------------------------------------------------------------------------------------------
\1\ There are no capital costs or operating and maintenance costs associated with this collection of
  information.

                                Table 2--Estimated Annual Recordkeeping Burden\1\
----------------------------------------------------------------------------------------------------------------
                                                    No. of
        21 CFR section              No. of       responses per   Total annual    Average burden     Total hours
                                 recordkeepers   recordkeeper       records     per recordkeeper
----------------------------------------------------------------------------------------------------------------
Maintenance of Records for                 950               1             950  0.03............            28.5
 Approved Labeling for Each                                                     (2 minutes).....
 ``Type B'' and ``Type C''
 Labeling (510.305).
----------------------------------------------------------------------------------------------------------------
\1\ There are no capital costs or operating and maintenance costs associated with this collection of
  information.

    Estimated annual reporting burden on industry is 29 hours as shown
in table 1. Industry estimates it takes about 15 minutes (0.25) to
submit the application. We estimate 100 original and supplemental
applications, and voluntary revocations for a total of 25 hours (100
submissions x 0.25 (15 minutes)). An additional 4 hours is added for
the rare notice of opportunity for a hearing to not approve or revoke
an application. Finally, we estimate 28.5 hours for maintaining and
retrieving labels as required by 21 CFR 510.305. We estimated 2 minutes
(0.03 hour) for each of approximately 950 licensees. Total burden for
reporting and recordkeeping would be 57.5 hours.

    Dated: May 6, 2013.
Leslie Kux,
Assistant Commissioner for Policy.
[FR Doc. 2013-11126 Filed 5-9-13; 8:45 am]
BILLING CODE 4160-01-P


[Federal Register Volume 79, Number 213 (Tuesday, November 4, 2014)]
[Proposed Rules]
[Page 65361]
[FR Doc No: 2014-26185]

=======================================================================
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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 110

[Docket No. USCG-2014-0142]
RIN 1625-AA01

Anchorage Regulations: Special Anchorage Areas, Marina del Rey
Harbor, California

AGENCY: Coast Guard, DHS.

ACTION: Notice of proposed rulemaking; notice of public meeting and
reopening of the comment period.

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

SUMMARY: The Coast Guard announces a November 20, 2014 public meeting
to receive comments on a notice of proposed rulemaking entitled
``Anchorage Regulations: Subpart A--Special Anchorage Areas, Marina del
Rey Harbor, California '' that was published in the Federal Register on
May 28, 2014. As stated in that document, the Coast Guard proposes to
disestablish the special anchorage area at the north end of the main
channel in Marina del Rey Harbor, California. This proposed action
would remove the anchorage area from Coast Guard regulations. This
proposed rule would not prevent vessels from anchoring in the harbor
during storms, stress, or other emergency situations. We have reopened
the comment period which will now end November 28, 2014.

DATES: A public meeting will be held on Thursday, November 20, 2014,
from 4:30 p.m. to 6:30 p.m. in Marina del Rey, CA to provide an
opportunity for oral comments. The comment period for this rulemaking
is reopened through November 28, 2014.

ADDRESSES: The public meeting will be held at the Burton W. Chace Park
Community Room, 13650 Mindanao Way, Marina del Rey, CA 90292, telephone
310-305-9595.
    You may submit comments identified by docket number USCG-2014-0142
using any one of the following methods:
    (1) Federal eRulemaking Portal: http://www.regulations.gov.
    (2) Fax:<PHONE_NUMBER>.
    (3) Mail or Delivery: Docket Management Facility (M-30), U.S.
Department of Transportation, West Building Ground Floor, Room W12-140,
1200 New Jersey Avenue SE., Washington, DC 20590-0001. Deliveries
accepted between 9 a.m. and 5 p.m., Monday through Friday, except
federal holidays. The telephone number is<PHONE_NUMBER>.
    See the ``Public Participation and Request for Comments'' portion
of the SUPPLEMENTARY INFORMATION section below for further instructions
on submitting comments. To avoid duplication, please use only one these
three methods.

FOR FURTHER INFORMATION CONTACT: If you have questions concerning the
meeting or the proposed rule, please call or email Lieutenant Van Vu,
Waterways Management Division, U.S. Coast Guard District 11, telephone
510-437-2978, email<EMAIL_ADDRESS>If you have questions on viewing
or submitting material to the docket, call Cheryl Collins, Program
Manager, Docket Operations, telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Background and Purpose

    We published a notice of proposed rulemaking (NPRM) in the Federal
Register on May 28, 2014 (79 FR 30509), entitled ``Anchorage
Regulations: Subpart A--Special Anchorage Areas, Marina del Rey Harbor,
California'' in which we stated we did not plan to hold a public
meeting. We received several requests for a meeting in comments
submitted to the docket and have concluded that a public meeting would
aid this rulemaking. Therefore, we are announcing a public meeting.
    You may view the NPRM in our online docket and comments submitted
thus far by going to http://www.regulations.gov. Once there, insert
``USCG-2014-0142'' in the ``Keyword'' box and click ``Search.'' You may
also visit the Docket Management Facility in Room W12-140 on the ground
floor of the Department of Transportation West Building, 1200 New
Jersey Avenue SE., Washington, DC 20590, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays. We have an agreement
with the Department of Transportation to use the Docket Management
Facility.
    We encourage you to participate in this rulemaking by submitting
comments either orally at the meeting or in writing. If you bring
written comments to the meeting, you may submit them to Coast Guard
personnel specified at the meeting to receive written comments. These
comments will be submitted to our online public docket. To submit your
comment online, go to http://www.regulations.gov, type the docket
number USCG-2014-0142 in the ``SEARCH'' box and click ``SEARCH.'' Click
on ``Submit a Comment'' on the line associated with this rulemaking.
All comments received will be posted without change to http://www.regulations.gov and will include any personal information you have
provided.
    Anyone can search the electronic form of comments received into any
of our dockets by the name of the individual submitting the comment (or
signing the comment, if submitted on behalf of an association,
business, labor union, etc.). You may review a Privacy Act notice
regarding our public dockets in the January 17, 2008, issue of the
Federal Register (73 FR 3316).

Information on Service for Individuals With Disabilities

    For information on facilities or services for individuals with
disabilities or to request special assistance at the public meeting,
contact Lieutenant Van Vu at the telephone number or email address
indicated under the FOR FURTHER INFORMATION CONTACT section above.

Public Meeting

    The Coast Guard will hold a public meeting regarding its Anchorage
Regulations: Subpart A--Special Anchorage Areas, Marina del Rey Harbor,
California proposed rule on Thursday, November 20, 2014, from 4:30 p.m.
to 6:30 p.m. at the Burton W. Chace Park Community Room at 13650
Mindanao Way, Marina del Rey, CA 90292, telephone<PHONE_NUMBER>. Public
parking lots are available on a pay basis. For Public transit
information to the Community Room, contact the Los Angeles County
Metropolitan Transportation Authority (Metro) at<PHONE_NUMBER> or search
at http://www.metro.net for additional information. We will provide a
written summary of the meeting and additional comments received at the
meeting in the docket. The meeting may conclude before the allotted
time if all who have come to submit oral comments have done so before
6:30 p.m.

    Dated: October 23, 2014.
J.A. Servidio,
Rear Admiral, U.S. Coast Guard, Commander, Eleventh Coast Guard
District.
[FR Doc. 2014-26185 Filed 11-3-14; 8:45 am]
BILLING CODE 9110-04-P


[Federal Register Volume 88, Number 106 (Friday, June 2, 2023)]
[Rules and Regulations]
[Page 36243]
[FR Doc No: 2023-11792]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[Docket No. USCG-2023-0458]

Safety Zone; Military Ocean Terminal Concord Safety Zone, Suisun
Bay, Military Ocean Terminal Concord, CA

AGENCY: Coast Guard, DHS.

ACTION: Notification of enforcement of regulation.

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

SUMMARY: The Coast Guard will enforce the safety zone in the navigable
waters of Suisun Bay, off Concord, CA, in support of explosive on-
loading to Military Ocean Terminal Concord (MOTCO) from June 4, 2023,
through June 10, 2023. This safety zone is necessary to protect
personnel, vessels, and the marine environment from potential explosion
within the explosive arc. The safety zone is open to all persons and
vessels for transitory use, but vessel operators desiring to anchor or
otherwise loiter within the safety zone must obtain the permission of
the Captain of the Port San Francisco or a designated representative.
All persons and vessels operating within the safety zone must comply
with all directions given to them by the Captain of the Port San
Francisco or a designated representative.

DATES: The regulations in 33 CFR 165.1198 will be enforced from 12:01
a.m. on June 4, 2023, until 11:59 p.m. on June 10, 2023.

FOR FURTHER INFORMATION CONTACT: If you have questions about this
notification of enforcement, call, or email Lieutenant William K.
Harris, U.S. Coast Guard Sector San Francisco, Waterways Management
Division, at<PHONE_NUMBER>, [email protected].

SUPPLEMENTARY INFORMATION: The Coast Guard will enforce the safety zone
in 33 CFR 165.1198 for the Military Ocean Terminal Concord, CA (MOTCO)
regulated area from 12:01 a.m. on June 4, 2023, until 11:59 p.m. on
June 10, 2023, or as announced via marine local broadcasts. This safety
zone is necessary to protect personnel, vessels, and the marine
environment from potential explosion within the explosive arc. The
regulation for this safety zone, Sec.  165.1198, specifies the location
of the safety zone which encompasses the navigable waters in the area
between 500 yards of MOTCO Pier 2 in position 38[deg]03'30'' N,
122[deg]01'14'' W and 3,000 yards of the pier. During the enforcement
periods, as reflected in Sec.  165.1198(d), if you are the operator of
a vessel in the regulated area you must comply with the instructions of
the COTP or the designated on-scene patrol personnel. Vessel operators
desiring to anchor or otherwise loiter within the safety zone must
contact Sector San Francisco Vessel Traffic Service at<PHONE_NUMBER> or
VHF Channel 14 to obtain permission.
    In addition to this notification of enforcement in the Federal
Register, the Coast Guard plans to provide notification of this
enforcement period via marine information broadcasts.

    Dated: May 26, 2023.
Taylor Q. Lam,
Captain, U.S. Coast Guard, Captain of the Port San Francisco.
[FR Doc. 2023-11792 Filed 6-1-23; 8:45 am]
BILLING CODE 9110-04-P


[Federal Register Volume 87, Number 127 (Tuesday, July 5, 2022)]
[Notices]
[Page 39820]
[FR Doc No: 2022-14232]

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

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 3511-024]

Lower Saranac Hydro, LLC; Notice of Denial of Water Quality
Certification

    On May 29, 2020, Lower Saranac Hydro, LLC (Lower Saranac Hydro)
filed an application for a license for the Groveville Hydroelectric
Project (project) in the above captioned docket. Lower Saranac Hydro
filed with the New York State Department of Environmental Conservation
(New York DEC) a request for water quality certification for the
project under section 401(a)(1) of the Clean Water Act on July 2, 2021.
On June 6, 2022, the New York DEC denied certification for the project.
Pursuant to 40 CFR 121.8, we are providing notice that New York DEC's
denial satisfies the requirements of 40 CFR 121.7(e).

    Dated: June 28, 2022.
Kimberly D. Bose,
Secretary.
[FR Doc. 2022-14232 Filed 7-1-22; 8:45 am]
BILLING CODE 6717-01-P


Significant New Alternatives Policy Program

Fire Extinguishing and Explosion Prevention Sector

Risk Screen on Substitutes for Halon 1211 in Portable Fire Extinguishers

Substitute: Firebane® All-Weather 1115 and Firebane® 1115

This risk screen does not contain Clean Air Act (CAA) Confidential
Business Information (CBI) and, therefore, may be disclosed to the
public.

Introduction

Ozone-depleting substances (ODS) are being phased out of production in
response to a series of diplomatic and legislative efforts that have
taken place over the past few years, including the Montreal Protocol and
the Clean Air Act Amendments of 1990 (CAAA).  The U.S. Environmental
Protection Agency (EPA), as authorized by Section 612 of the CAAA,
administers the Significant New Alternatives Policy (SNAP) Program,
which identifies acceptable and unacceptable substitutes for ODS in
specific end-uses based on assessment of their health and environmental
impacts.

EPA’s decision on the acceptability of a substitute is based largely
on the findings of a screening assessment of potential human health and
environmental risks posed by the substitute in specific applications.
EPA has already screened a large number of substitutes in many end-use
applications within all of the major ODS-using sectors, including
refrigeration and air conditioning, solvent cleaning, foam blowing,
aerosols, fire suppression, adhesives, coatings and inks, and
sterilization. The results of these risk screens are presented in a
series of Background Documents that are available in EPA's docket.

The purpose of this risk screen is to supplement EPA’s Background
Document on the fire suppression and explosion protection sector (EPA
1994) (hereinafter referred to as the Background Document). This risk
screen discusses the potential human health and environmental risks
posed by Firebane® All-Weather 1115 or Firebane® 1115 when used as a
streaming agent in portable fire extinguishers as a replacement for
Halon 1211.  The reader is referred to the Background Document for the
methodologies and assumptions used to conduct the risk screen. Table 1
presents the composition of the proposed substitutes.

Table 1.  Composition of Firebane® All-Weather 1115 and Firebane® 1115

Constituent	Chemical Formula	CAS No.	Formulation

(by Weight Percent)

	Firebane® 1115	Firebane® All-Weather 1115

Because the formulations of Firebane® All-Weather 1115 and Firebane®
1115 are very similar and share the same human health and environmental
risks, the remaining sections of this risk screen address both
Firebane® All-Weather 1115 and Firebane® 1115  (hereinafter
collectively referred to as “both Firebane® 1115 formulations”).

Section 2 of this risk screen summarizes the results of the risk screen
for the proposed substitutes listed in Table 1.  The remainder of the
risk screen is organized into the following sections:

Section 3: Atmospheric Assessment;

Section 4: Occupational Exposure Assessment;

Section 5: End-Use Exposure Assessment;

Section 6: General Population Exposure Assessment;

Section 7: Volatile Organic Compound Assessment; and

Section 8: References.

Summary of Results

Both Firebane® 1115 formulations are recommended for SNAP approval as
streaming agents in portable fire extinguishers.  However, the
appropriate personal protective equipment (PPE) should be worn and
proper training administered for the manufacture, use and disposal of
this product. PPE should include safety goggles and protective gloves.
Additionally, the risk screen indicates that the use of the proposed
substitutes will be less harmful to the atmosphere than the continued
use of Halon 1211.  Risk to the general population is expected to be
negligible, and occupational exposure should not pose a problem if PPE
is used.  For applications of this and all other portable fire
extinguishers, ICF recommends that National Fire Protection Agency
(NFPA) Standard 10 be followed.

Atmospheric Assessment

This section presents an assessment of the potential risks to
atmospheric integrity posed by the use of both Firebane® 1115
formulations as streaming agents.  According to the applicant, both
Firebane® 1115 formulations contain no Class I or Class II ozone
depleting substances, nor any compounds with measured global warming
potential (GWP). Therefore, the use of Firebane® 1115 and Firebane®
All-Weather 1115 will be less damaging to the atmosphere than the
continued use of Halon 1211.

Occupational Exposure Assessment

The potential for personnel exposure during manufacture, installation,
and maintenance are examined in this section.  The discharge scenarios
discussed are assumed to occur accidentally and not as the result of a
fire.  In order to evaluate occupational exposure, ICF has evaluated the
active compounds contained in both Firebane® 1115 formulations.  The
common application types, U.S. Food and Drug Administration (FDA)
approval status, and associated hazards for these compounds are
presented in   REF _Ref291689835 \h  \* MERGEFORMAT  Table 2 .

Table   SEQ Table \* ARABIC  2 : Common Applications Types and FDA
Approval Status of Firebane® 1115 and Firebane® All-Weather 1115
Constituents

Constituent	Common Application Types	FDA Approval Statusa,b,c	Associated
Hazards

a FDA = U.S. Food and Drug Administration

b FDA approvals are subject to use restrictions. Please see the cited
regulation for further information.

c GRAS = Generally Recognized as Safe

Occupational Exposure during Manufacture

Both formulations of Firebane® 1115 are not expected to pose a risk to
workers during manufacture. Based on the information provided in the
SNAP submission, occupational exposures during manufacture of both
Firebane® 1115 formulations are expected to be limited to the following
activities: mixing of the chemicals, filling of extinguishers, and
maintenance of extinguishers. According to the submitter, exposure to
both Firebane® 1115 formulation is expected to be in the liquid form,
with any vapor or gas exposures considered to be negligible. Workers
that may be exposed to any chemicals during manufacture or an accidental
release or spill are recommended to take precautionary measures as
listed below to minimize risk. In accordance with general procedures
prescribed in the MSDS of the proposed substitutes and by the submitter,
EPA recommends the following:

Proper Level D or higher PPE be used during handling of the substitute
(e.g. goggles, gloves);

Adequate ventilation should be in place;

All spills should be cleaned up immediately in accordance with good
industrial hygiene practices; and

Training for safe handling procedures should be provided to all
employees that would be likely to handle containers of or extinguishing
units filled with Firebane® 1115 or Firebane® All-Weather 1115.

Because of the minimal chance of worker exposure to the chemicals during
the manufacturing process, the use of exposure controls and adherence to
the appropriate occupational safety guidelines as mentioned above, are
sufficient to ensure that the manufacture of Firebane® 1115 and
Firebane® All-Weather 1115 does not pose a risk to human health.

Occupational Exposure during Installation and Maintenance

Both Firebane® 1115 formulations are not expected to pose a significant
risk to personnel during installation and maintenance activities. During
the installation or maintenance of either of the Firebane® 1115
formulations, inadvertent discharge may occur.  Oxygen displacement
during discharge of either Firebane® 1115 formulation is considered to
be negligible, and therefore not a concern during inadvertent discharge.
In addition, as noted above, all constituents exhibit low toxicity and
are commonly used in food or cosmetics applications.  To ensure that the
potential for exposure during installation and maintenance are further
minimized, it is recommended that all personnel involved in the
installation and maintenance of either of the Firebane® 1115
formulations adhere to safety guidelines, as mentioned previously in
Section   REF _Ref292194109 \r \h  \* MERGEFORMAT  4.1 .  It is
recommended that the safe handling training also focus on the prevention
of an inadvertent discharge.  In case of an inadvertent discharge,
workers should immediately follow the instructions listed in the MSDS
for Firebane® 1115 and Firebane® All-Weather 1115.

End-Use Exposure Assessment

In order to evaluate exposure at end use, ICF has evaluated the four
active compounds contained in Firebane® 1115 or for Firebane®
All-Weather 1115. The majority of Firebane ® 1115 is composed of GRAS
compounds, and the remaining constituents are FDA-approved for use as a
direct and/or indirect food additive. These compounds are commonly used
in food, pharmaceutical, and/or cosmetic applications. Individual
constituents may cause gastrointestinal discomfort (if excessively
ingested), eye irritation, skin irritation, and/or respiratory tract
irritation.

General Population Exposure Assessment

This section screens potential risks to the general population from
exposure to both formulations of Firebane® 1115 and its constituents to
ambient air, surface water, and solid waste.  Firebane® 1115 and
Firebane® All-Weather 1115 are not expected to cause a significant
threat to human health in the general population when used as a
streaming agent in portable fire extinguishers. The only consumer
exposure to either Firebane® 1115 formulation will be during discharge
of fire extinguishers in occupied spaces.   Firefighters and other
end-users exposed to Firebane® 1115 or Firebane® All-Weather 1115
during release should wear appropriate PPE, including goggles and
gloves.  Individuals should follow the precautionary measures described
in the proposed substitutes’ MSDS and Section 4.1 of this risk screen.
 When the recommended safety precautions are followed, no significant
adverse health effects are expected.

Ambient Air

Firebane® 1115 and Firebane® All-Weather 1115 are not expected to pose
a significant threat to human health in the general population in the
ambient air concentrations. As noted previously, both Firebane® 1115
formulations are composed entirely of compounds that are FDA-approved
for use in food of which some are also FDA-classified as GRAS.
Therefore, both Firebane® 1115 formulations are not expected to be a
safety concern for ambient air contamination.

Surface Water

As discussed in the Background Document, the physicochemical properties
of the majority of halon substitutes make it unlikely that the
substitutes would be released to surface water as a result of use. In
the case of both Firebane® 1115 formulations, it is expected that all
of the constituents would rapidly aerosolize during expulsion from the
container and then settle as a liquid film on surfaces. After settling,
cleanup would involve washing/rinsing of surfaces and there would be no
restrictions on discharge to publicly owned treatment works (POTW) based
on the GRAS nature of the majority of the constituents of both
Firebane® 1115 formulations.  Further, based on information from the
submitter, the proposed substitutes are readily biodegradable and have
exceptionally low biological oxygen demands and chemical oxygen demands.
Based on these considerations, it is expected that the proposed
substitutes would not contribute to surface water contamination.

Solid Waste

No constituents of Firebane® 1179 are considered to be hazardous waste
under EPA regulations implementing the Resource Conservation and
Recovery Act.  During post-activation clean-up procedures, clean-up
residues should be disposed of in accordance with requirements
appropriate for those materials.

Volatile Organic Compound Assessment

Of the constituents of both Firebane 1115®formulations, only one has
not been exempted as a volatile organic compound (VOC) under the CAA (40
CFR 51.000). However, some states also have regulations concerning
exempted VOCs and the definition of a VOC, which could exclude this
constituent from consideration as a VOC. In general, VOC emissions
should be sufficiently controlled through regulations and standard
industry practices. VOC emissions from the production of portable
extinguishers charged with Firebane® 1115 or Firebane® All-Weather
1115 are controlled through standard industry practices, and as such,
emissions from manufacture of units are likely to be minimal.  Using
release estimates from the Vintaging Model, the annual release rate
(including discharge, leak, and training release rates) for portable
extinguishers was calculated to be approximately 3.5% of extinguisher
charge size.  Assuming this release rate, an assessment was performed to
compare the annual VOC emissions from use of Firebane® 1115 and
Firebane® All-Weather 1115 in portable extinguisher produced in one
year to other anthropogenic sources of VOC emissions.  Assuming the
submitter’s current production plans, the amount of VOCs that would be
emitted would be approximately equal to 2.5x10-5 percent of the annual
VOC emissions caused by fires, or only about 9.1x10-7 percent of all
annual anthropogenic sources.   Moreover, even if all the Firebane®
1115 and Firebane® 1115 All-Weather produced by Global Safety Labs in
one year were to be released to the atmosphere over the course of the
year (extremely unlikely), the resulting annual VOC emissions would be
approximately 7.2x10-4 percent of annual VOC emissions caused by fires,
or 2.6x10-5 percent of all annual anthropogenic VOC emissions. As these
emissions are several orders of magnitude less than other anthropogenic
emissions, the environmental impacts of these VOCs are not considered a
threat.

References

EPA 1994. "Risk Screen on the Use of Substitutes for Class I
Ozone-depleting Substances:  Fire Extinguishing and Protection (Halon
Substitutes)," U.S. Environmental Protection Agency, March 1994.

EPA 2008. 2005 National Emissions Inventory Data & Documentation.
Inventory Data: 42 Category Summaries. Last updated 6 July 2010.
Accessed 20 September 11. Available online at
<http://www.epa.gov/ttn/chief/net/2005inventory.html#inventorydata>.

EPA 2009.  National Emissions Inventory (NEI) Air Pollutant Emissions
Trends Data and Estimation Procedures.1970 – 2008 Average Annual
Emissions, All Criteria Pollutants.  Last updated 09 June 2009. Accessed
20 September 11. Available online at
<http://www.epa.gov/ttn/chief/trends/index.html#tables>.

EPA 2011. The National Emissions Inventory. 2008 National Inventory
Data. Last updated 19 July 11. Accessed 20 September 11. Available
online at <http://www.epa.gov/ttn/chief/net/2008inventory.html>.

Global Safety Labs, Inc. 2010a.  “Request for information on a typical
compartment size in a protected vehicle and an estimated rate of
airflow.”  February 9, 2010.

Global Safety Labs, Inc. 2010b. “Response to Incomplete SNAP
Submission for Arctic-Firefreeze™ All-Weather 1115.” December 22,
2009.

Global Safety Labs, Inc. 2010c.  “SNAP Submission to EPA for
Arctic-Firefreeze™ All-Weather 1115.”  November 2, 2009.

Global Safety Labs, Inc. 2010d.  “Request to Include a Formula
Modification Under Current SNAP Preliminary Acceptability Determination
for Arctic Fire-Freeze™ All-Weather 1115.”  June 15, 2010.

NFPA. 2010.  NFPA 10: Standard for Portable Fire Extinguishers.  2010
Edition.  Available at
<http://www.nfpa.org/catalog/product.asp?pid=1010&order%5Fsrc=B484>

 The total annual release rate of 3.5% for portable extinguishers was
determined using the average annual leak rate (2%), annual discharge
rate (1.5%), and annual release during training (0%) from the Vintaging
Model (v4.4_3.23.11).

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September 23, 2011

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September 23, 2011

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