[Federal Register Volume 81, Number 154 (Wednesday, August 10, 2016)]
[Notices]
[Pages 52926-52932]
[FR Doc No: 2016-18911]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-78480; File No. SR-NASDAQ-2016-097]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Related to Detection of Loss of Connection

August 4, 2016.
    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 July 28, 2016, The NASDAQ Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I and II, below, which Items have been prepared by the Exchange.
The Commission is publishing this notice to

solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend NASDAQ Options Market LLC's
(``NOM'') Rules at Chapter VI, Section 6, entitled ``Acceptance of
Quotes and Orders'' to adopt functionality which is designed to assist
NOM Participants, hereinafter ``Participants,'' in the event that they
lose communication with their assigned Financial Information eXchange
(``FIX''),\3\ Specialized Quote Feed (``SQF''),\4\ or Ouch to Trade
Options (``OTTO'') \5\ Ports due to a loss of connectivity.
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    \3\ FIX permits the entry of orders.
    \4\ SQF permits the transmission of quotes to the Exchange by a
NOM Market Maker using its Client Application.
    \5\ OTTO permits the transmission of orders to the Exchange by a
Participant. Immediate or cancel orders will not be cancelled
pursuant to this Chapter VI, Section 6 because, by definition, these
orders will cancel if not executed. All Participants have the
ability to utilize OTTO. Orders submitted by NOM Market Makers over
this interface will be treated as quotes.
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    The text of the proposed rule change is available on the Exchange's
Web site at http://nasdaq.cchwallstreet.com, at the principal office of
the Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant 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 Chapter VI, Section 6, entitled
``Acceptance of Quotes and Orders'' to adopt a new section ``(e)''
entitled ``Detection of Loss of Connection,'' a new automated process
which NOM proposes to adopt for its SQF,\6\ FIX and OTTO Ports in the
event that they lose communication with a Client Application due to a
loss of connectivity. This feature is designed to protect NOM Options
Market Makers \7\ and other market participants from inadvertent
exposure to excessive risk.
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    \6\ Today, SQF, FIX and OTTO have the capability to cancel
quotes and orders respectively. The rule change would adopt a
formalized process to automatically disconnect and cancel quotes for
SQF and offer the opportunity to cancel orders for FIX and OTTO in
addition to a disconnect if elected, when there is a loss of
communication with the Participant's Client Application. The
Exchange is formalizing the process within Chapter VI, Section 6(e).
    \7\ The term ``Nasdaq Options Market Maker'' or ``Options Market
Maker'' (herein ``NOM Market Maker'') means 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 Chapter VII of these Rules.
See NOM Rules at Chapter I, Section 1(a)(26).
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    By way of background, Participants currently enter quotes and
orders utilizing either an SQF, FIX or OTTO Port. SQF is utilized by
NOM Options Market Makers. FIX and OTTO are available to all market
participants. These ports are System \8\ components through which a
Participant communicates its quotes and/or orders to the NOM match
engine through the Participant's Client Application.
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    \8\ The term ``System'' shall mean the automated system for
order execution and trade reporting owned and operated by NOM as the
NOM Options market. See Chapter VI, Section 1(a).
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    Under the proposed rule change, an SQF Port would be defined as the
Exchange's System component through which Participants communicate
their quotes from the Client Application at proposed Chapter VI,
Section 6(e)(i)(B). FIX and OTTO Ports would be defined as the
Exchange's System components through which Participants communicate
their orders from the Client Application at proposed Chapter VI,
Section 6(e)(i)(C). NOM Options Market Makers may submit quotes to the
Exchange from one or more SQF Ports.
    Similarly, market participants may submit orders to the Exchange
from one or more FIX and/or OTTO Ports. The proposed removal feature
will be mandatory for each NOM Market Makers utilizing SQF for the
removal of quotes and optional for any market participant utilizing FIX
and OTTO for the removal of orders.
    When the SQF Port detects the loss of communication with a
Participant's Client Application because the Exchange's server does not
receive a Heartbeat message \9\ for a certain period of time (``nn''
seconds), the Exchange will automatically logoff the Participant's
affected Client Application and automatically cancel all of the
Participant's open quotes. Quotes will be cancelled across all Client
Applications that are associated with the same NOM Market Makers ID and
underlying issues.
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    \9\ It is important to note that the Exchange separately sends a
connectivity message to the Participant as evidence of connectivity.
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    The Exchange proposes to define ``Client Application'' as the
System component of the Participant through which the Exchange
Participant communicates its quotes and orders to the Exchange at
proposed Chapter VI, Section 6(e)(i)(D). The Exchange proposes to
define a ``Heartbeat'' message as a communication that acts as a
virtual pulse between the SQF, FIX or OTTO Port and the Client
Application at proposed Chapter VI, Section 6(e)(i)(A). The Heartbeat
message sent by the Participant and subsequently received by the
Exchange allows the SQF, FIX or OTTO Port to continually monitor its
connection with the Participant.
SQF Ports
    The Exchange's System has a default time period, which will trigger
a disconnect from the Exchange and remove quotes, set to fifteen (15)
seconds for SQF Ports. A Participant may change the default period of
``nn'' seconds of no technical connectivity to trigger a disconnect
from the Exchange and remove quotes to a number between one hundred
(100) milliseconds and 99,999 milliseconds for SQF Ports prior to each
session of connectivity to the Exchange. This feature is enabled for
each NOM Market Makers and may not be disabled.
    There are two ways to change the number of ``nn'' seconds: (1)
systemically or (2) by contacting the Exchange's operations staff. If
the Participant systemically changes the default number of ``nn''
seconds, that new setting shall be in effect throughout the current
session of connectivity \10\ and will then default back to fifteen
seconds.\11\ The Participant may change the default setting
systemically prior to each session of connectivity. The Participant may
also communicate the time to the Exchange by calling the Exchange's
operations staff. If the time period is communicated to the

Exchange by calling Exchange operations, the number of ``nn'' seconds
selected by the Participant shall persist for each subsequent session
of connectivity until the Participant either contacts Exchange
operations and changes the setting or the Participant systemically
selects another time period prior to the next session of connectivity.
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    \10\ Each time the Participant connects to the Exchange's System
is a new period of connectivity. For example, if the Participant
were to connect and then disconnect within a trading day several
times, each time the Participant disconnected the next session would
be a new session of connectivity.
    \11\ The Exchange's System would capture the new setting
information that was changed by the Participant and utilize the
amended setting for that particular session. The setting would not
persist beyond the current session of connectivity and the setting
would default back to 15 seconds for the next session if the
Participant did not change the setting again.
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FIX Ports
    The Exchange's System has a default time period, which will trigger
a disconnect from the Exchange and remove orders, set to thirty (30)
seconds for FIX Ports. The Participant may disable the removal of
orders feature but not the disconnect feature. If the Participant
elects to have its orders removed, in addition to the disconnect, the
Participant may determine a time period of no technical connectivity to
trigger the disconnect and removal of orders between (1) second and
thirty (30) seconds for FIX Ports prior to each session of connectivity
to the Exchange.
    There are two ways to change the number of ``nn'' seconds: (1)
systemically or (2) by contacting the Exchange's operations staff. If
the Participant systemically changes the default number of ``nn''
seconds, that new setting shall be in effect throughout that session of
connectivity and will then default back to thirty seconds at the end of
that session. The Participant may change the default setting
systemically prior to each session of connectivity. The Participant may
also communicate the time to the Exchange by calling the Exchange's
operations staff. If the time period is communicated to the Exchange by
calling Exchange operations, the number of ``nn'' seconds selected by
the Participant shall persist for each subsequent session of
connectivity until the Participant either contacts Exchange operations
and changes the setting or the Participant systemically selects another
time period prior to the next session of connectivity.
    Similar to SQF Ports, when a FIX Port detects the loss of
communication with a Participant's Client Application for a certain
time period (``nn'' seconds), the Exchange will automatically logoff
the Participant's affected Client Application and if elected,
automatically cancel all open orders. The Participant may have an order
which has routed away prior to the cancellation, in the event that the
order returns to the Order Book, because it was either not filled or
partially filled, that order will be subsequently cancelled.
    The disconnect feature is mandatory for FIX users, however the user
has the ability to elect to also enable a removal feature, which will
cancel all open orders submitted through that FIX Port. If the removal
of orders feature is not enabled, the System will simply disconnect the
FIX user and not cancel any orders. The FIX user would have to commence
a new session to add, modify or cancel its orders once disconnected.
OTTO Ports
    The Exchange's System has a default time period, which will trigger
a disconnect from the Exchange and remove orders, set to fifteen (15)
seconds for OTTO Ports. The Participant may disable the removal of
orders feature but not the disconnect feature. If the Participant
elects to have its orders removed, in addition to the disconnect, the
Participant may determine a time period of no technical connectivity to
trigger the disconnect and removal of orders between one hundred (100)
milliseconds and 99,999 milliseconds.
    There are two ways to change the number of ``nn'' seconds: (1)
systemically or (2) by contacting the Exchange's operations staff. If
the Participant systemically changes the default number of ``nn''
seconds, that new setting shall be in effect throughout that session of
connectivity and will then default back to fifteen seconds at the end
of that session. The Participant may change the default setting
systemically prior to each session of connectivity. The Participant may
also communicate the time to the Exchange by calling the Exchange's
operations staff. If the time period is communicated to the Exchange by
calling Exchange operations, the number of ``nn'' seconds selected by
the Participant shall persist for each subsequent session of
connectivity until the Participant either contacts Exchange operations
and changes the setting or the Participant systemically selects another
time period prior to the next session of connectivity.
    Similar to SQF and FIX Ports, when an OTTO Port detects the loss of
communication with a Participant's Client Application for a certain
time period (``nn'' seconds), the Exchange will automatically logoff
the Participant's affected Client Application and if elected,
automatically cancel all open orders. The Participant may have an order
which has routed away prior to the cancellation; in the event that the
order returns to the Order Book, because it was either not filled or
partially filled, that order will be subsequently cancelled.
    The disconnect feature is mandatory for OTTO users however the user
has the ability to elect to also enable a removal feature, which will
cancel all open orders submitted through that OTTO Port. If the removal
of orders feature is not enabled, the System will simply disconnect the
OTTO user and not cancel any orders. The OTTO user would have to
commence a new session to add, modify or cancel its orders once
disconnected.
    The trigger for the SQF, FIX and OTTO Ports is event and Client
Application specific. The automatic cancellation of the NOM Market
Maker's quotes for SQF Ports and open orders, if elected by the
Participant for FIX and OTTO Ports entered into the respective SQF, FIX
or OTTO Ports via a particular Client Application will neither impact
nor determine the treatment of the quotes of other NOM Market Makers
entered into SQF Ports or orders of the same or other Participants
entered into FIX or OTTO Ports via a separate and distinct Client
Application.
    In other words, with respect to quotes, each NOM Market Maker only
maintains one quote in a given option in the order book. A new quote
would replace the existing quote. Orders on the other hand do not
replace each other in the order book as multiple orders may exist in a
given option at once. Therefore, the difference in the impact between
NOM Market Makers submitting quotes and Participants submitting orders
is that quotes may continue to be submitted and/or refreshed by
unaffected NOM Market Makers because these market participants are
cancelled based on ID when an SQF Port disconnects, whereas all of the
open orders submitted by a given firm will be impacted when a FIX or
OTTO port disconnects, if the firm elected to have orders cancelled.
    The Exchange will issue an Options Trader Alert advising
Participants on the manner in which they should communicate the number
of ``nn'' seconds to the Exchange for SQF, FIX and OTTO Ports.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\12\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\13\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest, by offering removal functionality for NOM Market Makers as
well as all other market participants to prevent disruption in the
marketplace and also

offering this removal feature to other market participants.
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    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(5).
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    NOM Market Makers will be required to utilize removal functionality
with respect to SQF Ports. This feature will remove impediments to and
perfect the mechanism of a free and open market and a national market
system and protect investors and the public interest by requiring NOM
Market Makers quotes to be removed in the event of a loss of
connectivity with the Exchange's System. NOM Market Makers provide
liquidity to the market place and have obligations unlike other market
participants.\14\ This risk feature for SQF is important because it
will enable NOM Market Makers to avoid risks associated with
inadvertent executions in the event of a loss of connectivity with the
Exchange. The proposed rule change is designed to not permit unfair
discrimination among market participants, as it would apply uniformly
to all NOM Market Makers utilizing SQF.
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    \14\ Pursuant to NOM Rules at Chapter VII, Section 5, entitled
``Obligations of NOM Options Market Makers'', in registering as a
market maker, an Options Participant commits himself to various
obligations. Transactions of a NOM Options Market Makers must
constitute a course of dealings reasonably calculated to contribute
to the maintenance of a fair and orderly market, and NOM Options
Market Makers should not make bids or offers or enter into
transactions that are inconsistent with such course of dealings.
Further, all NOM Options Market Makers are designated as specialists
on NOM for all purposes under the Act or rules thereunder. See
Chapter VII, Section 5.
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    Utilizing a time period for SQF Ports of fifteen (15) seconds and
permitting the NOM Market Makers to modify the setting to between 100
milliseconds and 99,999 milliseconds is consistent with the Act because
the Exchange does not desire to trigger unwarranted logoffs of
Participants and therefore allows Participants the ability to set their
time in order to enable the Exchange the authority to disconnect the
Participant with this feature. Each NOM Market Makers has different
levels of sensitivity with respect to this disconnect setting and each
NOM Market Makers has their own system safeguards as well. A default
setting of fifteen (15) seconds is appropriate to capture the needs of
all NOM Market Makers and high enough not to trigger unwarranted
removal of quotes.
    Further, NOM Market Makers are able to customize their setting. The
Exchange's proposal to permit a timeframe for SQF Ports between 100
milliseconds and 99,999 milliseconds is consistent with the Act and the
protection of investors because the purpose of this feature is to
mitigate the risk of potential erroneous or unintended executions
associated with a loss in communication with a Client Application.
Participants are able to better anticipate the appropriate time within
which they may require prior to a logoff as compared to the Exchange.
The Participant is being offered a timeframe by the Exchange within
which to select the appropriate time. The Exchange does not desire to
trigger unwarranted logoffs of Participants and therefore permits
Participants to provide an alternative time to the Exchange, within the
Exchange's prescribed timeframe, which authorized the Exchange to
disconnect the Participant. The ``nn'' seconds serve as the
Participant's instruction to the Exchange to act upon the loss of
connection and remove quotes from the System. This range will
accommodate Participants in selecting their appropriate times within
the prescribed timeframes.
    Also, NOM Market Makers have quoting obligations \15\ and are more
sensitive to price movements as compared to other market participants.
It is consistent with the Act to provide a wider timeframe within which
to customize settings for FIX Ports as compared to SQF Ports. NOM
Market Makers need to remain vigilant of market conditions and react
more quickly to market movements as compared to other Participants
entering orders into the System. The proposal acknowledges this
sensitivity borne by NOM Market Makers and reflects the reaction time
of NOM Market Makers as compared to Participants entering orders. Of
note, the proposed customized timeframe for FIX would be too long for
NOM Market Makers given their quoting requirements and sensitivity to
price movements. NOM Market Makers would be severely impacted by a loss
of connectivity of more than several seconds. The NOM Market Makers
would have exposure during the time period in which they are unable to
manage their quote and update that quote. The Participant is best
positioned to determine its setting.
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    \15\ See note 14 above.
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    The Exchange's proposal is further consistent with the Act because
it will mitigate the risk of potential erroneous or unintended
executions associated with a loss in communication with a Client
Application which protects investors and the public interest. Also, any
interest that is executable against a NOM Market Maker's quotes that is
received \16\ by the Exchange prior to the trigger of the disconnect to
the Client Application, which is processed by the System, automatically
executes at the price up to the NOM Market Maker's size. In other
words, the System will process the request for cancellation in the
order it was received by the System.
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    \16\ The time of receipt for an order or quote is the time such
message is processed by the Exchange book.
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    The System operates consistently with the firm quote obligations of
a broker-dealer pursuant to Rule 602 of Regulation NMS. Specifically,
with respect to NOM Market Makers, their obligation to provide
continuous two-sided quotes on a daily basis is not diminished by the
removal of such quotes triggered by the disconnect. NOM Market Makers
are required to provide continuous two-sided quotes on a daily
basis.\17\ NOM Market Makers will not be relieved of the obligation to
provide continuous two-sided quotes on a daily basis, nor will it
prohibit the Exchange from taking disciplinary action against a NOM
Market Makers for failing to meet the continuous quoting obligation
each trading day as a result of disconnects.
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    \17\ See note 14 above.
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    The proposal to permit NOM Market Makers to amend the default
setting at the beginning of each session of connectivity is consistent
with the Act because it avoids unwarranted logoffs of Participants and
provides Participants the opportunity to set a time, within the
prescribed timeframe, to authorize the Exchange to disconnect the
Participant.
    Today, NASDAQ PHLX LLC (``Phlx'') and NASDAQ BX, INC. (``BX'')
offer its market makers a similar feature to the one proposed by the
Exchange for the automatic removal of quotes when connectivity issues
arise.\18\ Phlx and BX have identical rules to the NOM proposal for SQF
Ports.
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    \18\ See Phlx Rule 1019(c) and BX Rule at Chapter VI, Section
6(e).
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    With respect to FIX Ports,\19\ the Exchange will offer an optional
removal functionality to all market participants. Offering the FIX
removal feature on a voluntary basis to all other non-Market Maker
Participants is consistent with the Act because it permits them an
opportunity to utilize this risk feature, if desired, and avoid risks
associated with inadvertent executions in the event of a loss of
connectivity with the Exchange. The removal feature is designed to
mitigate the risk of missed and/or unintended executions associated
with a loss in communication with a Client Application.
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    \19\ OTTO ports may be utilized today by non-NOM Market Makers.
The removal functionality remains optional for non-NOM Market Makers
similar to FIX.
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    The proposed rule change is designed to not permit unfair
discrimination among market participants, as this

removal feature will be offered uniformly to all Participants utilizing
FIX. The Exchange will not require OTTO users to utilize the removal
feature for orders similar to FIX. The disconnect feature for FIX is
mandatory, however market participants will have the option to either
enable or disable the removal feature, which would result in the
cancellation of all orders submitted over a FIX port when such port
disconnects. It is appropriate to offer this removal feature as
optional to all market participants utilizing FIX because these market
participants may not bear the same magnitude of risk of potential
erroneous or unintended executions.\20\ In addition, market
participants utilizing FIX may desire their orders to remain on the
order book despite a technical disconnect, so as not to miss any
opportunities for execution of such orders while the FIX session is
disconnected. The Exchange will disconnect Participants from the
Exchange and not cancel its orders if the removal feature is disabled
for FIX. The disconnect feature is mandatory and will cause the
Participant to be disconnected within the default timeframe or the
timeframe otherwise specified by the Participant.
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    \20\ NOM Market Makers utilizes both SQF and OTTO and would be
subject to quoting obligations.
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    This feature is consistent with the Act because it enables FIX or
OTTO users, particularly non-Market Maker OTTO users, the ability to
disconnect from the Exchange, assess the situation and make a
determination concerning their risk exposure. The Exchange notes that
in the event that orders need to be removed, the Participant may elect
to utilize the Kill Switch \21\ feature. It is consistent with the Act
to require other market participants to be disconnected because the
Participant is otherwise not connected to the Exchange's System and the
Participant simply needs to reconnect to commence submitting and
cancelling orders. Requiring a disconnect when a loss of communication
is detected is a rational course of action for the Exchange to alert
the Participant of the technical connectivity issue.
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    \21\ See NOM Rule at Chapter VI, Section 6(d). The Kill Switch
would impact all three protocols, SQF, FIX and OTTO.
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    The Exchange's proposal to set a default timeframe of thirty (30)
seconds for FIX and permit a FIX user to customize their timeframe
between 1 second and 30 seconds for the removal of orders is consistent
with the Act and the protection of investors because the purpose of
this optional feature is to mitigate the risk of potential erroneous or
unintended executions associated with a loss in communication with a
Client Application. Participants selecting the removal feature are able
to better anticipate the appropriate time that they require prior to a
logoff as compared to the Exchange, within the Exchange's prescribed
timeframes.
    The Exchange does not desire to trigger unwarranted logoffs of
Participants and therefore permits Participants to provide a time to
the Exchange, within the Exchange's prescribed timeframe, to authorize
the Exchange to disconnect the Participant and remove orders. The
``nn'' seconds serve as the Participant's instruction to the Exchange
to act upon the loss of connection and remove orders from the System.
The Participant is also best positioned to determine that it only
desires the disconnect feature, which is mandatory, and not the removal
feature.
    The Exchange's proposal to offer FIX users the removal feature on a
voluntary basis is similar to Phlx and BX.\22\ Both Phlx and BX have
identical rules regarding FIX and a loss of communication as proposed
for NOM.
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    \22\ See Phlx Rule 1019(c) and BX Rule at Chapter VI, Section
6(e).
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    The proposed timeframe for the FIX feature is consistent with the
Act because the Exchange seeks to provide its Participants with the
ability to select the amount of time that they desire for a loss of
communication prior to taking action to cancel open orders or simply
disconnect. The Participant should have the ability to select the
appropriate time, within a prescribed timeframe, for authorizing the
Exchange to cancel its open orders or simply disconnect from the
Exchange. Inadvertent cancellations may create a greater risk of harm
to investors and the Participant is better positioned to determine the
appropriate time, with the prescribed timeframe, to remove orders or
disconnect.
    With respect to OTTO Ports, the Exchange notes that it offers OTTO
to all market participants, not just NOM Market Makers. Similar to SQF,
the Exchange desires to utilize the 15 second default with the ability
to customize the setting to permit a timeframe between 100 milliseconds
and 99,999 milliseconds. The Exchange believes that it is consistent
with the Act to utilize the shorter timeframe of 15 seconds as compared
to the 30 second timeframe for FIX because today, OTTO is utilized
solely by NOM Market Makers, although it is offered to all
Participants. OTTO orders submitted by NOM Market Makers over this
interface are treated as quotes for purposes of compiling with quoting
obligations.
    As noted previously, NOM Market Makers have quoting obligations
\23\ and are more sensitive to price movements as compared to other
market participants. NOM Market Makers need to remain vigilant of
market conditions and react more quickly to market movements as
compared to other Participants entering orders into the System. The
proposal acknowledges this sensitivity borne by NOM Market Makers and
reflects the reaction time of NOM Market Makers as compared to
Participants entering orders. NOM Market Makers would be severely
impacted by a loss of connectivity of more than several seconds. The
NOM Market Makers would have exposure during the time period in which
they are unable to manage their quote and update that quote. The
Participant is best positioned to determine its setting. Also, the
Exchange desires to offer NOM Market Makers the ability to have SQF
quotes and OTTO orders removed with the same timeframes in order that
NOM Market Makers may attend to all open interest in a similar manner
with this risk feature.
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    \23\ See note 14 above.
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    The Exchange notes that offering the shorter timeframe, despite the
fact that non-Market Maker Participants are utilizing this feature is
also consistent with the Act because the removal feature will not be
mandatory. The disconnect feature for OTTO will be mandatory, however
market participants will have the option to either enable or disable
the removal feature, which would result in the cancellation of all
orders submitted over an OTTO Port when such port disconnects. NOM
Market Makers will be able to set a similar timeframe for both SQF and
OTTO to ensure all open interest is removed simultaneously.
    The Exchange believes that it is consistent with the Act to permit
OTTO users to disable the removal feature, similar to FIX, because the
Exchange does not desire to require non-Market Maker Participants to
have orders removed on mandatory basis. While the Exchange believes
that this risk feature will mitigate the risk of potential erroneous or
unintended executions associated with a loss in communication with a
Client Application which protects investors and the public interest, as
noted above, Participants are able to better anticipate the appropriate
time within which they may require prior to a logoff as compared to the
Exchange.
    The Exchange does not desire to trigger unwarranted logoffs of
Participants and therefore permits

Participants to provide an alternative time to the Exchange, within the
Exchange's prescribed timeframe, which authorized the Exchange to
disconnect the Participant. The ``nn'' seconds serve as the
Participant's instruction to the Exchange to act upon the loss of
connection and remove quotes from the System. This range will
accommodate Participants in selecting their appropriate times within
the prescribed timeframes.
    The Exchange believes this hybrid approach will permit NOM Market
Makers to synchronize the removal of their SQF quotes and OTTO
orders,\24\ while still permitting non-Market Maker Participants the
ability to choose to enable the risk feature. OTTO is not available on
either Phlx or BX, so the OTTO feature is not similar to those markets,
rather, as mentioned, it is a hybrid approach.
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    \24\ NOM Market Makers may utilize both SQF and OTTO.
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    It is appropriate to offer this removal feature as optional to all
Participants utilizing OTTO, who may not be required to provide quotes
in all products in which they are registered. Non-Market Maker
Participants utilizing OTTO may not bear the same magnitude of risk of
potential erroneous or unintended executions as NOM Market Makers. In
addition, non-Market Maker Participants utilizing OTTO may desire their
orders to remain on the order book despite a technical disconnect, so
as not to miss any opportunities for execution of such orders while the
OTTO session is disconnected. OTTO is similar to FIX on Phlx and BX
because it offers market participants, on a voluntary basis, the
ability to cancel orders when a technical disconnect occurs.\25\
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    \25\ See Phlx Rule 1019(c) and BX Rule at Chapter VI, Section
6(e).
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    The Exchange's default timeframe for the disconnect and removal of
orders for OTTO is 15 seconds with the ability to modify that timeframe
to between 100 milliseconds and 99,999 milliseconds, on a session by
session basis. This timeframe is similar to the SQF timeframe offered
by Phlx and BX today.\26\ Similar to FIX on Phlx and BX today, OTTO
users may choose to enable or disable the removal feature when a
disconnect occurs. The proposed timeframe for the OTTO feature is
consistent with the Act because the Exchange seeks to provide its
Participants with the ability to select the amount of time that they
desire for a loss of communication prior to taking action to cancel
open orders or simply disconnect.
---------------------------------------------------------------------------

    \26\ Id.
---------------------------------------------------------------------------

    The Exchange notes that Participants are free to select the
protocols with which they desire to access NOM. The Exchange does not
require Participants to utilize more than one protocol to access NOM.
The proposed rule change will help maintain a fair and orderly market
which promotes efficiency and protects investors. This mandatory
removal feature for NOM Market Makers using SQF and optional removal
for all market participants using FIX or OTTO will mitigate the risk of
potential erroneous or unintended executions associated with a loss in
communication with a Client Application.

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. Specifically, the Exchange does
not believe the proposed rule change will cause an undue burden on
intra-market competition because NOM Market Makers, unlike other market
participants, have greater risks in the market place. Quoting across
many series in an option creates large principal positions that expose
NOM Market Makers, who are required to continuously quote in assigned
options, to potentially significant market risk.
    Providing a broader timeframe for the disconnect and removal of
orders for FIX as compared to the disconnect and removal of quotes for
SQF Ports does not create an undue burden on competition. NOM Market
Makers have quoting obligations \27\ and are more sensitive to price
movements as compared to other market participants. The proposal does
not impose an undue burden on intra-market competition because it
provides a tighter timeframe for the disconnect and removal of quotes
for SQF Ports as compared to the disconnect and removal of orders, if
enabled, for FIX Ports. NOM Market Makers need to remain vigilant of
market conditions and react more quickly to market movements as
compared to other Participants entering multiple orders into the
System.
---------------------------------------------------------------------------

    \27\ See note 14 above.
---------------------------------------------------------------------------

    The proposal reflects this sensitivity borne by NOM Market Makers
and reflects the reaction time of NOM Market Makers as compared to
other Participants entering orders. Offering the removal feature to
other market participants on an optional basis for FIX and OTTO users
does not create an undue burden on intra-market competition because
unlike NOM Market Makers, other market participants do not bear the
same risks of potential erroneous or unintended executions. FIX users
have the opportunity to disable the removal feature and simply
disconnect from the Exchange. FIX users may also set a timeframe that
is appropriate for their business. It is appropriate to offer this
optional cancellation functionality to other market participants for
open orders, because those orders are subject to risks of missed and/or
unintended executions due to a lack of connectivity which the
Participants need to weigh.
    Today, OTTO is utilized solely by NOM Market Makers, although it is
offered to all Participants. OTTO Orders submitted by NOM Market Makers
over this interface are treated as quotes for purposes of compiling
with quoting obligations. NOM Market Makers have quoting obligations
\28\ and are more sensitive to price movements as compared to other
market participants. NOM Market Makers need to remain vigilant of
market conditions and react more quickly to market movements as
compared to other Participants entering orders into the System. For
this reason, the proposal does not impose an undue burden on intra-
market competition because the proposal acknowledges this sensitivity
borne by NOM Market Makers and reflects the reaction time of NOM Market
Makers as compared to Participants entering orders. As noted, NOM
Market Makers would be severely impacted by a loss of connectivity of
more than several seconds. NOM Market Makers would have exposure during
the time period in which they are unable to manage their quote and
update that quote.
---------------------------------------------------------------------------

    \28\ See note 14 above.
---------------------------------------------------------------------------

    The Exchange's proposal offers NOM Market Makers the ability to
have SQF and OTTO orders removed within the same timeframes in order
that NOM Market Makers may attend to all open interest in a similar
manner with this risk feature. The Exchange notes that offering the
shorter timeframe, despite the fact that non-Market Maker Participants
may utilize this feature does not impose an undue burden on intra-
market competition because the removal feature will not be mandatory.
The disconnect feature for OTTO will be mandatory, however market
participants will have the option to either enable or disable removal
feature, which would result in the cancellation of all orders submitted
over an OTTO Port when such port disconnects.

    The Exchange believes that it does not impose an undue burden on
intra-market competition to permit OTTO users to disable the removal
feature, similar to FIX, because the Exchange does not desire to
require non-Market Maker Participants to have orders removed on
mandatory basis. While the Exchange believes that this risk feature
will mitigate the risk of potential erroneous or unintended executions
associated with a loss in communication with a Client Application which
protects investors and the public interest, as noted above,
Participants are able to better anticipate the appropriate time within
which they may require prior to a logoff as compared to the Exchange.
    The Exchange does not desire to trigger unwarranted logoffs of
Participants and therefore permits Participants to provide an
alternative time to the Exchange, within the Exchange's prescribed
timeframe, which authorized the Exchange to disconnect the Participant.
This hybrid approach will permit NOM Market Makers to synchronize the
removal of their SQF quotes and OTTO orders, while still permitting
non-NOM Market Makers the ability to choose to enable the risk feature.
    Finally, the Exchange does not believe that such change will impose
any burden on inter-market competition that is not necessary or
appropriate in furtherance of the purposes of the Act. Other options
exchanges offer similar functionality.\29\
---------------------------------------------------------------------------

    \29\ See BOX's Rule 8140, CBOE's Rule 6.23C, Phlx Rule 1019(c)
and BX Rule at Chapter VI, Section 6(e).
---------------------------------------------------------------------------

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

    No written comments were either solicited or received.

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

    Because the foregoing proposed rule change does not: (i)
significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \30\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\31\
---------------------------------------------------------------------------

    \30\ 15 U.S.C. 78s(b)(3)(a)(iii).
    \31\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) normally does
not become operative for 30 days from the date of filing. However, Rule
19b-4(f)(6)(iii) \32\ 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 it may immediately offer the proposed
risk protection feature. The Commission believes that waiving the 30-
day operative delay is consistent with the protection of investors and
the public interest. The Exchange proposes to adopt a functionality
designed to assist Participants with managing certain risks in the
event that a Participant loses communication with its FIX, SQF, or OTTO
Ports due to a loss of connectivity. The Commission notes that other
options exchanges currently have similar risk protection
functionalities for their members.\33\ Therefore, the Commission hereby
waives the 30-day operative delay and designates the proposal operative
upon filing.\34\ 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.
---------------------------------------------------------------------------

    \32\ 17 CFR 240.19b-4(f)(6)(iii).
    \33\ See Phlx Rule 1019(c) and BX Rule at Chapter VI, Section
6(e).
    \34\ 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).
---------------------------------------------------------------------------

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NASDAQ-2016-097 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-NASDAQ-2016-097. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NASDAQ-2016-097 and should
be submitted on or before August 31, 2016.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\35\
---------------------------------------------------------------------------

    \35\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-18911 Filed 8-9-16; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 80, Number 108 (Friday, June 5, 2015)]
[Proposed Rules]
[Pages 32055-32057]
[FR Doc No: 2015-13340]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2015-1427; Directorate Identifier 2013-NM-203-AD]
RIN 2120-AA64

Airworthiness Directives; Airbus Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: We propose to supersede Airworthiness Directive (AD) 96-18-06
for certain Airbus Model A320-211 and -231 airplanes. AD 96-18-06
currently requires visual inspections to detect cracks of the
pressurized floor fittings at frame (FR) 36, and renewal of the zone
protective finish or replacement of fittings with new fittings if
necessary. Since we issued AD 96-18-06, an extended service goal
analysis by the manufacturer revealed that the compliance times and
repetitive inspection intervals should be reduced to meet the design
service goal. This proposed AD would retain the requirements of AD 96-
18-06, with reduced compliance times and repetitive inspection
intervals. This proposed AD would also add Model A320-212 airplanes to
the applicability. We are proposing this AD to detect and correct
fatigue cracking in the pressurized floor fittings at FR 36, which
could result in failure of a floor fitting and subsequent
depressurization of the fuselage.

DATES: We must receive comments on this proposed AD by July 20, 2015.

ADDRESSES: You may send comments by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE., Washington, DC 20590.
     Hand Delivery: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE., Washington, DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
    For service information identified in this proposed AD, contact
Airbus, Airworthiness Office--EIAS, 1 Rond Point Maurice Bellonte,
31707 Blagnac Cedex, France; telephone +33 5 61 93 36 96; fax +33 5 61
93 44 51; email<EMAIL_ADDRESS>Internet http://www.airbus.com. You may view this referenced service information at the
FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA.
For information on the availability of this material at the FAA, call
425-227-1221.

Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2015-
1427; or in person at the Docket Management Facility between 9 a.m. and
5 p.m., Monday through Friday, except Federal holidays. The AD docket
contains this proposed AD, the regulatory evaluation, any comments
received, and other information. The street address for the Docket
Operations office (telephone<PHONE_NUMBER>) is in the ADDRESSES
section. Comments will be available in the AD docket shortly after
receipt.

FOR FURTHER INFORMATION CONTACT: Sanjay Ralhan, Aerospace Engineer,
International Branch, ANM-116, Transport Airplane Directorate, FAA,
1601 Lind Avenue SW., Renton, WA 98057-3356; telephone<PHONE_NUMBER>;
fax<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Comments Invited

    We invite you to send any written relevant data, views, or
arguments about this proposed AD. Send your comments to an address
listed under the ADDRESSES section. Include ``Docket No. FAA-2015-1427;
Directorate Identifier 2013-NM-203-AD'' at the beginning of your
comments. We specifically invite comments on the overall regulatory,
economic, environmental, and energy aspects of this proposed AD. We
will consider all comments received by the closing date and may amend
this proposed AD based on those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this proposed AD.

Discussion

    On August 23, 1996, we issued AD 96-18-06, Amendment 39-9730 (61 FR
46703, September 5, 1996). AD 96-18-06 requires actions intended to
address an unsafe condition on certain Airbus Model A320-211 and -231
airplanes.
    Since we issued AD 96-18-06, Amendment 39-9730 (61 FR 46703,
September 5, 1996), an extended service goal analysis by the
manufacturer revealed that the compliance times and repetitive
inspection intervals must be reduced to meet the design service goal.
    The European Aviation Safety Agency (EASA), which is the Technical
Agency for the Member States of the European Union, has issued EASA
Airworthiness Directive 2013-0226, dated September 23, 2013 (referred
to after this as the Mandatory Continuing Airworthiness Information, or
``the MCAI''), to correct an unsafe condition for Airbus Model A320-
211, -212, and -231 airplanes. The MCAI states:

    During center fuselage certification full scale fatigue test,
damage was found on the pressurized floor fittings at Frame 36,
below the lower surface panel. This condition, if not detected and
corrected, could affect the structural integrity of the aeroplane.
    To prevent such damage, Airbus developed modification 21282,
which was introduced in production from [manufacturer serial number]
MSN 0105, to reinforce the pressurized floor fitting lower surface
by changing material. For affected in-service aeroplanes, Airbus
issued Service Bulletin (SB) A320-57-1028, introducing repetitive
inspections, and SB A320-57-1029, which provides modification
instructions.
    DGAC [Direction G[eacute]n[eacute]rale de l'Aviation Civile]
France issued [an] AD * * * [for Model A320-111, -211, and -231
airplanes] to require these repetitive inspections and, depending on
findings, corrective action(s), while the modification was specified
in that AD as optional terminating action for these inspections.
    Following new analysis in the frame of ESG (Extended Service
Goal) exercise, the inspection thresholds and intervals have been
revised to meet the original DSG (Design Service Goal).

    For the reasons described above, this [EASA] AD retains the
requirements of [a] DGAC France AD * * *, which is superseded, but
requires these actions within reduced compliance times. [This EASA
AD also adds Model A320-212 airplanes to its applicability.]

You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating it in Docket No. FAA-
2015-1427.

Related Service Information Under 1 CFR Part 51

    Airbus has issued Service Bulletin A320-57-1028, Revision 02, dated
June 3, 2013. The service information describes procedures for an
inspection to detect cracks of the pressurized floor fittings at frame
(FR) 36, renewal of the zone protective finish, and replacement of
fittings with new fittings.
    Airbus has also issued Service Bulletin A320-57-1029, Revision 02,
dated June 16, 1999. The service information describes procedures for
modification of the pressurized floor fittings at FR 36.
    The actions described in this service information are intended to
correct the unsafe condition identified in the MCAI. This service
information is reasonably available because the interested parties have
access to it through their normal course of business or by the means
identified in the ADDRESSES section of this NPRM.

FAA's Determination and Requirements of This Proposed AD

    This product has been approved by the aviation authority of another
country, and is approved for operation in the United States. Pursuant
to our bilateral agreement with the State of Design Authority, we have
been notified of the unsafe condition described in the MCAI and service
information referenced above. We are proposing this AD because we
evaluated all pertinent information and determined an unsafe condition
exists and is likely to exist or develop on other products of the same
type design.
    Unlike the required actions in the MCAI, this proposed AD would not
permit further flight if damage (cracking) is detected during any
inspection of the pressurized floor fittings at FR 36. Instead, this
proposed AD would require repair of any damage before further flight.
We find that, to achieve an adequate level of safety for the affected
fleet, damaged structural elements must be replaced prior to further
flight. This difference has been coordinated with EASA.

Costs of Compliance

    We estimate that this proposed AD affects 13 airplanes of U.S.
registry.
    The actions required by AD 96-18-06, Amendment 39-9730 (61 FR
46703, September 5, 1996), and retained in this proposed AD, take about
3 work-hours per product, at an average labor rate of $85 per work-
hour. Required parts cost about $0 per product. Based on these figures,
the estimated cost of the actions that are required by AD 96-18-06 is
$255 per product.
    We also estimate that it would take about 11 work-hours per product
to comply with the basic requirements of this proposed AD. The average
labor rate is $85 per work-hour. Required parts would cost about $0 per
product. Based on these figures, we estimate the cost of this proposed
AD on U.S. operators to be $12,155, or $935 per product.
    We have received no definitive data that would enable us to provide
cost estimates for the on-condition actions specified in this proposed
AD.

Authority for This Rulemaking

    Title 49 of the United States Code specifies the FAA's authority to
issue rules on aviation safety. Subtitle I, section 106, describes the
authority of the FAA Administrator. ``Subtitle VII: Aviation
Programs,'' describes in more detail the scope of the Agency's
authority.
    We are issuing this rulemaking under the authority described in
``Subtitle VII, Part A, Subpart III, Section 44701: General
requirements.'' Under that section, Congress charges the FAA with
promoting safe flight of civil aircraft in air commerce by prescribing
regulations for practices, methods, and procedures the Administrator
finds necessary for safety in air commerce. This regulation is within
the scope of that authority because it addresses an unsafe condition
that is likely to exist or develop on products identified in this
rulemaking action.

Regulatory Findings

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

List of Subjects in 14 CFR Part 39

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

The Proposed Amendment

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

PART 39--AIRWORTHINESS DIRECTIVES

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

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

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by removing Airworthiness Directive (AD)
96-18-06, Amendment 39-9730 (61 FR 46703, September 5, 1996), and
adding the following new AD:

Airbus: Docket No. FAA-2015-1427; Directorate Identifier 2013-NM-
203-AD.

(a) Comments Due Date

    We must receive comments by July 20, 2015.

(b) Affected ADs

    This AD replaces AD 96-18-06, Amendment 39-9730 (61 FR 46703,
September 5, 1996).

(c) Applicability

    This AD applies to Airbus Model A320-211, -212, and -231
airplanes, certificated in any category, manufacturer serial numbers
0002 through 0104 inclusive.

(d) Subject

    Air Transport Association (ATA) of America Code 57, Wings.

(e) Reason

    This AD was prompted by an extended service goal analysis by the
manufacturer, which revealed that the compliance times and
repetitive inspection intervals should be reduced to meet the design
service goal. We are issuing this AD to detect and correct fatigue
cracking in the pressurized floor fittings at FR 36, which could
result in failure of a floor fitting and subsequent depressurization
of the fuselage.

(f) Compliance

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

(g) Retained Inspection

    This paragraph restates the requirements of paragraph (a) of AD
96-18-06, Amendment 39-9730 (61 FR 46703, September 5, 1996), with
revised service information for Airbus Model A320-211 and -231
airplanes. Prior to the accumulation of 16,000 total landings, or
within 6 months after October 10, 1996 (the effective date of AD 96-
18-06), whichever occurs later, perform a visual inspection to
detect cracks of the 6 fittings of the pressurized floor at frame 36
under the lower surface panel, in accordance with the Accomplishment
Instructions of Airbus Service Bulletin A320-57-1028, Revision 1,
dated April 19, 1996; or Airbus Service Bulletin A320-57-1028,
Revision 02, dated June 3, 2013. As of the effective date of this
AD, use only Airbus Service Bulletin A320-57-1028, Revision 02,
dated June 3, 2013, for accomplishing the actions required by this
paragraph. Accomplishment of the initial inspection required by
paragraph (i) of this AD terminates the actions required by this
paragraph.
    (1) If no cracking is found, prior to further flight, renew the
zone protective finish, in accordance with the Accomplishment
Instructions of Airbus Service Bulletin A320-57-1028, Revision 1,
dated April 19, 1996; or Airbus Service Bulletin A320-57-1028,
Revision 02, dated June 3, 2013. As of the effective date of this
AD, use only Airbus Service Bulletin A320-57-1028, Revision 02,
dated June 3, 2013, for accomplishing the actions required by this
paragraph. Repeat the visual inspection thereafter at intervals not
to exceed 12,000 landings.
    (2) If only 1 of the 6 fittings is found to be cracked and that
crack is less than or equal to 0.59 inch (15 mm) in length, prior to
further flight, replace the cracked fitting with a new fitting, in
accordance with the Accomplishment Instructions of Airbus Service
Bulletin A320-57-1028, Revision 1, dated April 19, 1996; or Airbus
Service Bulletin A320-57-1028, Revision 02, dated June 3, 2013.
Thereafter, prior to the accumulation of 500 landings following
accomplishment of this replacement, replace the remaining 5 fittings
with new fittings, in accordance with the Accomplishment
Instructions of Airbus Service Bulletin A320-57-1028, Revision 1,
dated April 19, 1996; or Airbus Service Bulletin A320-57-1028,
Revision 02, dated June 3, 2013. As of the effective date of this
AD, use only Airbus Service Bulletin A320-57-1028, Revision 02,
dated June 3, 2013, for accomplishing the actions required by this
paragraph.
    (3) If only 1 of the 6 fittings is found to be cracked, and that
crack is greater than 0.59 inch (15 mm) in length, prior to further
flight, replace all six fittings with new fittings, in accordance
with the Accomplishment Instructions of Airbus Service Bulletin
A320-57-1028, Revision 1, dated April 19, 1996; or Airbus Service
Bulletin A320-57-1028, Revision 02, dated June 3, 2013. As of the
effective date of this AD, use only Airbus Service Bulletin A320-57-
1028, Revision 02, dated June 3, 2013, for accomplishing the actions
required by this paragraph.
    (4) If 2 or more fittings are found to be cracked, prior to
further flight, replace all 6 fittings with new fittings, in
accordance with the Accomplishment Instructions of Airbus Service
Bulletin A320-57-1028, Revision 1, dated April 19, 1996; or Airbus
Service Bulletin A320-57-1028, Revision 02, dated June 3, 2013. As
of the effective date of this AD, use only Airbus Service Bulletin
A320-57-1028, Revision 02, dated June 3, 2013, for accomplishing the
actions required by this paragraph.

(h) Retained Optional Terminating Action

    This paragraph restates the provisions of paragraph (b) of AD
96-18-06, Amendment 39-9730 (61 FR 46703, September 5, 1996), with
revised service information for Airbus Model A320-211 and -231
airplanes. Replacement of all 6 fittings with new fittings, in
accordance with the Accomplishment Instructions of Airbus Service
Bulletin A320-57-1028, Revision 01, dated April 19, 1996; or Airbus
Service Bulletin A320-57-1028, Revision 02, dated June 3, 2013;
constitutes terminating action for the inspection requirements of
paragraph (g) of this AD.

(i) New Inspection

    (1) At the latest of the times in paragraph (i)(1)(i),
(i)(1)(ii), or (i)(1)(iii) of this AD: Do a detailed inspection of
the pressurized floor fittings at frame 36, in accordance with the
Accomplishment Instructions of Airbus Service Bulletin A320-57-1028,
Revision 02, dated June 3, 2013. Repeat the inspection thereafter,
at intervals not to exceed 9,300 flight cycles or 18,600 flight
hours, whichever occurs first. Accomplishment of the initial
inspection required by this paragraph terminates the actions
required by paragraph (g) of this AD.
    (i) Prior to the accumulation of 20,900 total flight cycles or
41,800 total flight hours, whichever occurs first.
    (ii) Prior to the accumulation of 9,300 flight cycles or 18,600
flight cycles since the most recent inspection required by paragraph
(g) or (i) of this AD, whichever occurs first.
    (iii) At the earlier of the times specified in paragraph
(i)(iii)(A) and (i)(iii)(B) of this AD.
    (A) Prior to the accumulation of 1,250 flight cycles or 2,500
flight hours after the effective date of this AD, whichever occurs
first.
    (B) Prior to the accumulation of 12,000 flight cycles since the
most recent inspection required by paragraph (g) or (i) of this AD.
    (2) If any crack is found during any inspection required by
paragraph (i)(1) of this AD: Before further flight, repair using a
method approved by the Manager, International Branch, ANM-116,
Transport Airplane Directorate, FAA; or the European Aviation Safety
Agency (EASA); or Airbus's EASA Design Organization Approval (DOA).

(j) New Optional Terminating Action

    Modification (replacement of aluminum fittings with titanium
fittings) of the pressurized floor fittings at frame 36, in
accordance with the Accomplishment Instructions of Airbus Service
Bulletin A320-57-1029, Revision 02, dated June 16, 1999, is
terminating action for the repetitive inspections required by
paragraphs (g) and (i) of this AD.

(k) Other FAA AD Provisions

    The following provisions also apply to this AD:
    (1) Alternative Methods of Compliance (AMOCs): The Manager,
International Branch, ANM-116, Transport Airplane Directorate, FAA,
has the authority to approve AMOCs for this AD, if requested using
the procedures found in 14 CFR 39.19. In accordance with 14 CFR
39.19, send your request to your principal inspector or local Flight
Standards District Office, as appropriate. If sending information
directly to the International Branch, send it to ATTN: Sanjay
Ralhan, Aerospace Engineer, International Branch, ANM-116, Transport
Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-
3356; telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>. Information may be
emailed to<EMAIL_ADDRESS>    (i) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the local flight standards district office/certificate holding
district office. The AMOC approval letter must specifically
reference this AD.
    (ii) AMOCs approved previously for AD 96-18-06, Amendment 39-
9730 (61 FR 46703, September 5, 1996), are approved as AMOCs for the
corresponding provisions of this AD.
    (2) Contacting the Manufacturer: As of the effective date of
this AD, for any requirement in this AD to obtain corrective actions
from a manufacturer, the action must be accomplished using a method
approved by the Manager, International Branch, ANM-116, Transport
Airplane Directorate, FAA; or the EASA; or Airbus's EASA DOA. If
approved by the DOA, the approval must include the DOA-authorized
signature.

(l) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information
(MCAI) EASA Airworthiness Directive 2013-0226, dated September 23,
2013, for related information. This MCAI may be found in the AD
docket on the Internet at http://www.regulations.gov by searching
for and locating Docket No. FAA-2015-1427.
    (2) For service information identified in this AD, contact
Airbus, Airworthiness Office--EIAS, 1 Rond Point Maurice Bellonte,
31707 Blagnac Cedex, France; telephone +33 5 61 93 36 96; fax +33 5
61 93 44 51; email<EMAIL_ADDRESS>Internet http://www.airbus.com. You may view this service information at the FAA,
Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA.
For information on the availability of this material at the FAA,
call<PHONE_NUMBER>.

    Issued in Renton, Washington, on May 19, 2015.
Dionne Palermo,
Acting Manager, Transport Airplane Directorate, Aircraft Certification
Service.
[FR Doc. 2015-13340 Filed 6-4-15; 8:45 am]
 BILLING CODE 4910-13-P


[Federal Register: December 4, 2009 (Volume 74, Number 232)]
[Rules and Regulations]
[Page 63617-63672]
[DOCID:fr04de09-26]

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

Coast Guard

46 CFR Parts 2, 24, 30, 70, 90, 114, 175, and 188

[USCG-2008-1107]
RIN 1625-ZA21

Shipping; Vessel Inspections; Technical and Conforming Amendments

AGENCY: Coast Guard, DHS.

ACTION: Final rule.

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

SUMMARY: This rule makes a non-substantive change to the definition of
``ferry'' in 46 CFR. The purpose of this rule is to incorporate into
Coast Guard regulations the statutory definition of ``ferry'' found at
46 U.S.C. 2101(10)(b), as amended by the Coast Guard and Maritime
Transportation Act of 2006. This rule will have no substantive effect
on ferry vessel owners or operators or other members of the public.

DATES: This final rule is effective December 4, 2009.

ADDRESSES: Comments and material received from the public, as well as
documents mentioned in this preamble as being available in the docket,
are part of docket USCG-2008-1107 and are available for inspection or
copying at the 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, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays. You may also find this
docket on the Internet by going to http://regulations.gov, inserting
USCG-2008-1107 in the ``Keyword'' box, and then clicking ``Search.''

FOR FURTHER INFORMATION CONTACT: If you have questions on this rule,
call or email LCDR Reed Kohberger, Coast Guard Headquarters,
Washington, DC, telephone<PHONE_NUMBER><EMAIL_ADDRESS>If
you have questions on viewing the docket, call Ms. Renee V. Wright,
Program Manager, Docket Operations, telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Table of Contents for Preamble

I. Abbreviations
II. Regulatory History
III. Background and Purpose
IV. Regulatory Analysis
    A. Regulatory Planning and Review
    B. Small Entities
    C. Collection of Information
    D. Federalism
    E. Unfunded Mandates Reform Act
    F. Taking of Private Property
    G. Civil Justice Reform
    H. Protection of Children
    I. Indian Tribal Governments
    J. Energy Effects
    K. Technical Standards
    L. Environment

I. Abbreviations

CFR Code of Federal Regulations
DHS Department of Homeland Security
FR Federal Register
NPRM Notice of Proposed Rulemaking
U.S.C. United States Code

II. Regulatory History

    We did not publish a notice of proposed rulemaking (NPRM) for this
regulation. Under 5 U.S.C. 553(b)(3)(B), the Coast Guard finds that
good cause exists for not publishing an NPRM for the revision in the
rule because it is a non-substantive change. These changes will have no
substantive effect on the public beyond what is already required by
statute; therefore, it is unnecessary to publish an NPRM because these
regulatory revisions are already mandated by law. Notice and public
procedures are unnecessary because public comment on this rulemaking
will have no effect on the statute that these rules incorporate. This
rule does not create any substantive requirements, but merely
incorporates a technical change to a statutory definition into the CFR.
See, Gray Panthers Advocacy Committee v. Sullivan, 936 F.2d 1284, 1291
(D.C. Cir. 1991) (when regulations merely restate the statute they
implement, notice-and-comment procedures are unnecessary); Komjathy v.
National Transportation Safety Bd., 832 F.2d 1294, 1297 (D.C.Cir.1987),
cert. denied, 486 U.S. 1057, 108 S.Ct. 2825, 100 L.Ed.2d 926 (1988)
(``The fact that the regulation merely reiterates the statutory
language precludes any serious argument that the regulation affects the
agency or holders of airman certificates in such a way as to require
notice-and-comment procedures pursuant to 5 U.S.C. 553.'') Under 5
U.S.C. 553(b)(3)(A), the Coast Guard also finds that this rule is
exempt from notice and comment rulemaking requirements because these
provisions involve agency organization, procedures, and practices. This
final rule merely restates the revised statutory definition for the
inspection and certification of ferry vessels. The Coast Guard already
ensures that these vessels comply with the vessel inspection laws and
regulations. It is necessary for Coast Guard inspection personnel to be
aware of this new statutory mandate and for Coast Guard procedures used
by local Coast Guard inspection offices to be modified where necessary
to reflect this change in the law. These amendments place this new
statutory mandate into Coast Guard regulations that are used by
inspection personnel. This rule consists only of corrections and
editorial, organizational, and conforming amendments.
    The rule is effective immediately notwithstanding 5 U.S.C. 553(d)
because it is not a substantive rule.

III. Background and Purpose

    We are amending the definition of ``ferry'' in 46 CFR to conform to
the statutory definition of ``ferry'' found at 46 U.S.C. 2101(10)(b),
which was amended by section 301 of The Coast Guard and Maritime Safety
Act of 2006, Public Law 109-241. The amended definition provides that
``Ferry means a vessel that is used on a regular schedule--
    (1) To provide transportation only between places that are not more
than 300 miles apart; and
    (2) To transport only --
    (i) Passengers; or
    (ii) Vehicles, or railroad cars, that are being used, or have been
used, in transporting passengers or goods.''
    The statutory definition of ferry was further included elsewhere in
the Act as a category of passenger vessel or small passenger vessel,
both of which already require inspection and certification. See, 46
U.S.C. 2101(22) and (35).
    This rule merely conforms to the statutory requirements of defining
ferry vessels and including them within the category of passenger
vessel or small passenger vessel as appropriate. The existing tables in
46 CFR that describe vessels requiring inspection and certification are
being amended to reflect the change in statutory definition.

Discussion of Rule

    Subchapters A, H, K, and T of 46 CFR, define the term ``ferry'' and
this rule modifies those definitions to conform to the statutory
definition and the applicability of the inspection subchapter to ferry
vessels. Subchapters A, C, D, I, H, and U of 46 CFR contain tables that
describe vessels requiring inspection and certification. This rule
incorporates ferry vessels into those tables in the appropriate
category of passenger vessel or small passenger vessel in accordance
with the statutory change.

IV. Regulatory Analyses

    We developed this rule after considering numerous statutes and
executive orders related to rulemaking. Below we summarize our analyses
based on 13 of these statutes or executive orders.

A. Regulatory Planning and Review

    This rule is not a ``significant regulatory action'' under section
3(f) of Executive Order 12866, Regulatory Planning and Review, and does
not require an assessment of potential costs and benefits under section
6(a)(3) of that Order. The Office of Management and Budget has not
reviewed it under that Order.
    We expect the economic impact of this rule to be so minimal that a
full Regulatory Analysis under the regulatory policies and procedures
of DHS is unnecessary. As this rule involves technical and conforming
amendments and procedures and non-substantive changes, it will not
impose any costs on the public.

B. Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have
considered whether this rule would have a significant economic impact
on a substantial number of small entities. The term ``small entities''
comprises small businesses, not-for-profit organizations that are
independently owned and operated and are not dominant in their fields,
and governmental jurisdictions with populations of less than 50,000.
This rule does not require a general NPRM and, therefore, is exempt
from the requirements of the Regulatory Flexibility Act. Although this
rule is exempt, we reviewed it for potential economic impact on small
entities. Therefore, the Coast Guard certifies under 5 U.S.C. 605(b)
that this final rule will not have a significant economic impact on a
substantial number of small entities.

C. Collection of Information

    This rule calls for no new collection of information under the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

D. Federalism

    A rule has implications for federalism under Executive Order 13132,
Federalism, if it has a substantial direct effect on State or local
governments and would either preempt State law or impose a substantial
direct cost of compliance on them. It is well settled that States may
not regulate in categories reserved for regulation by the Coast Guard.
It is also well settled, now, that all of the categories covered in 46
U.S.C. 3306, 3703, 7101, and 8101 (design, construction, alteration,
repair, maintenance, operation, equipping, personnel qualification, and
manning of vessels), as well as the reporting of casualties and any
other category in which Congress intended the Coast Guard to be the
sole source of a vessel's obligations, are within the field foreclosed
from regulation by the States. (See the decision of the Supreme Court
in the consolidated cases of United States v. Locke and Intertanko v.
Locke, 529 U.S. 89, 120 S.Ct. 1135 (March 6, 2000).)
    Section 301 of The Coast Guard and Maritime Safety Act of 2006,
Public Law 109-241, amended the statutory definition of ferry found at
46 U.S.C. 2101(10)(b) to include ferry vessels as a category of
passenger vessel or small passenger vessel in the statute. These
categories of vessels are required to undergo safety inspections prior
to and during subsequent operation of the vessels, including approval
of the design, construction, alteration, repair, maintenance,
operation, equipping, personnel qualification, and manning of the
vessels. Because the States may not regulate within these categories,
preemption under Executive Order 13132 is not an issue.

E. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538)
requires Federal agencies to assess the effects of their discretionary
regulatory actions. In particular, the Act addresses actions that may
result in the expenditure by a State, local, or tribal government, in
the aggregate, or by the private sector of $100,000,000 or more in any
one year. Though this rule will not result in an expenditure of this
magnitude, we do discuss the effects of this rule elsewhere in this
preamble.

F. Taking of Private Property

    This rule will not effect a taking of private property or otherwise
have taking implications under Executive Order 12630, Governmental
Actions and Interference with Constitutionally Protected Property
Rights.

G. Civil Justice Reform

    This rule meets applicable standards in sections 3(a) and 3(b)(2)
of Executive Order 12988, Civil Justice Reform, to minimize litigation,
eliminate ambiguity, and reduce burden.

H. Protection of Children

    We have analyzed this rule under Executive Order 13045, Protection
of Children from Environmental Health Risks and Safety Risks. This rule
is not an economically significant rule and does not create an
environmental risk to health or risk to safety that may
disproportionately affect children.

I. Indian Tribal Governments

    This rule does not have tribal implications under Executive Order
13175, Consultation and Coordination with Indian Tribal Governments,
because it does not have a substantial direct effect on one or more
Indian tribes, on the relationship between the

Federal Government and Indian tribes, or on the distribution of power
and responsibilities between the Federal Government and Indian tribes.

J. Energy Effects

    We have analyzed this rule under Executive Order 13211, Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use. We have determined that it is not a ``significant
energy action'' under that order because it is not a ``significant
regulatory action'' under Executive Order 12866 and is not likely to
have a significant adverse effect on the supply, distribution, or use
of energy. The Administrator of the Office of Information and
Regulatory Affairs has not designated it as a significant energy
action. Therefore, it does not require a Statement of Energy Effects
under Executive Order 13211.

K. Technical Standards

    The National Technology Transfer and Advancement Act (NTTAA) (15
U.S.C. 272 note) directs agencies to use voluntary consensus standards
in their regulatory activities unless the agency provides Congress,
through the Office of Management and Budget, with an explanation of why
using these standards would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., specifications of materials, performance, design, or
operation; test methods; sampling procedures; and related management
systems practices) that are developed or adopted by voluntary consensus
standards bodies. This rule does not use technical standards.
Therefore, we did not consider the use of voluntary consensus
standards.

L. Environment

    We have analyzed this rule under Department of Homeland Security
Directive 023-01 and Commandant Instruction M16475.lD, which guide the
Coast Guard in complying with the National Environmental Policy Act of
1969 (NEPA)(42 U.S.C. 4321-4370f), and have concluded that this action
is one of a category of actions which do not individually or
cumulatively have a significant effect on the human environment. This
rule is categorically excluded, under section 2.B.2. figure 2-1,
paragraph 34(a) and (d), of the Instruction. This rule involves a non-
substantive, technical change to conform the regulations to an amended
statutory definition found at 46 U.S.C. 2101(10)(b) and the
applicability of inspection to ferry vessels. Paragraph 34(a) deals
with editorial or procedural regulations and paragraph 34(d) concerns
regulations for the inspection of vessels. An environmental analysis
checklist and a categorical exclusion determination are available in
the docket where indicated under ADDRESSES.

List of Subjects

46 CFR Part 2

    Marine safety, Passenger vessels, Water transportation.

46 CFR Part 24

    Marine safety, Passenger vessels.

46 CFR Part 30

    Marine safety, Passenger vessels.

46 CFR Part 70

    Marine safety, Passenger vessels, Water transportation.

46 CFR Part 90

    Marine safety, Passenger vessels.

46 CFR Part 114

    Marine safety, Passenger vessels, Water transportation.

46 CFR Part 175

    Marine safety, Passenger vessels, Water transportation.

46 CFR Part 188

    Marine safety, Passenger vessels.

0
For the reasons discussed in the preamble, the Coast Guard amends 46
CFR parts 2, 24, 30, 70, 90, 114, 175, and 188 as set forth below:

Title 46--Shipping

PART 2--VESSEL INSPECTIONS

0
1. The authority citation for part 2 continues to read as follows:

    Authority:  33 U.S.C. 1903; 43 U.S.C. 1333; 46 U.S.C. 2110,
3103, 3205, 3306, 3307, 3703; 46 U.S.C. Chapter 701; E.O. 12234, 45
FR 58801, 3 CFR, 1980 Comp., p. 277; Department of Homeland Security
Delegation No. 0170.1. Subpart 2.45 also issued under the Act Dec.
27, 1950, Ch. 1155, secs. 1, 2, 64 Stat. 1120 (see 46 U.S.C. App.
Note prec. 1).

0
2. Revise Table 2.01-7(a) to read as follows:

Sec.  2.01-7  Classes of vessels (including motorboats) examined or
inspected and certificated.

    (a) * * *
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* * * * *

0
3. Section 2.10-25 is amended by revising the definitions for
``Ferry'', ``Passenger Vessel'', and ``Small Passenger Vessel'', to
read as follows:

46 CFR Sec.  2.10-25

Sec.  2.10-25   Definitions.

* * * * *
    Ferry means a vessel that is used on a regular schedule--
    (1) To provide transportation only between places that are not more
than 300 miles apart; and
    (2) To transport only--
    (i) Passengers; or
    (ii) Vehicles, or railroad cars, that are being used, or have been
used, in transporting passengers or goods.
* * * * *
    Passenger vessel means a vessel of at least 100 gross tons:
    (1) Carrying more than 12 passengers, including at least one
passenger for hire;
    (2) That is chartered and carrying more than 12 passengers;
    (3) That is a submersible vessel carrying at least one passenger
for hire; or
    (4) That is a ferry carrying a passenger.
* * * * *
    Small passenger vessel means a vessel of less than 100 gross tons:
    (1) Carrying more than 6 passengers, including at least 1 passenger
for hire;
    (2) That is chartered with the crew provided or specified by the
owner or the owner's representative and carrying more than 6
passengers;
    (3) That is chartered with no crew provided or specified by the
owner or the owner's representative and carrying more than 12
passengers;
    (4) That is a submersible vessel carrying at least one passenger
for hire; or
    (5) That is a ferry carrying more than 6 passengers.
* * * * *

PART 24--GENERAL PROVISIONS

0
4. The authority citation for part 24 continues to read as follows:

    Authority:  46 U.S.C. 2113, 3306, 4104, 4302; Pub. L. 103-206;
107 Stat. 2439; E.O. 12234; 45 FR 58801; 3 CFR, 1980 Comp., p. 277;
Department of Homeland Security Delegation No. 0170.1.

0
5. Revise Table 24.05-1(a) to read as follows:

Sec.  24.05-1  Vessels subject to the requirements of this subchapter.

    (a) * * *
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* * * * *

PART 30--GENERAL PROVISIONS

0
6. The authority citation for part 30 continues to read as follows:

    Authority:  46 U.S.C. 2103, 3306, 3703; Pub. L. 103-206, 107
Stat. 2439; 49 U.S.C. 5103, 5106; Department of Homeland Security
Delegation No. 0170.1; Section 30.01-2 also issued under the
authority of 44 U.S.C. 3507; Section 30.01-05 also issued under the
authority of Sec. 4109, Pub. L. 101-380, 104 Stat. 515.

0
7. Revise Table 30.01-5(d) to read as follows:

Sec.  30.01-5  Application of regulations--TB/ALL.

* * * * *
    (d) * * *
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* * * * *

PART 70--GENERAL PROVISIONS

0
8. The authority citation for part 70 continues to read as follows:

    Authority:  46 U.S.C. 3306, 3703; Pub. L. 103-206, 107 Stat.
2439; 49 U.S.C. 5103, 5106; E.O. 12234, 45 FR 58801; 3 CFR, 1980
Comp., p. 277; Department of Homeland Security Delegation No.
0170.1; Section 70.01-15 also issued under the authority of 44
U.S.C. 3507.

0
9. Revise Table 70.05-1(a) to read as follows:

Sec.  70.05-1  United States flag vessels subject to the requirements
of this subchapter.

    (a) * * *
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BILLING CODE 9110-04-C

* * * * *

0
10. Section 70.10-1 is amended by revising the definitions for
``Ferry'' and ``Passenger vessel'' to read as follows:

Sec.  70.10-1  Definitions.

* * * * *
    Ferry means a vessel that is used on a regular schedule--
    (1) To provide transportation only between places that are not more
than 300 miles apart; and
    (2) To transport only--
    (i) Passengers; or
    (ii) Vehicles, or railroad cars, that are being used, or have been
used, in transporting passengers or goods.
* * * * *
    Passenger vessel means a vessel of at least 100 gross tons:
    (1) Carrying more than 12 passengers, including at least one
passenger for hire;
    (2) That is chartered and carrying more than 12 passengers;
    (3) That is a submersible vessel carrying at least one passenger
for hire; or
    (4) That is a ferry carrying a passenger.
* * * * *

PART 90--GENERAL PROVISIONS

0
11. The authority citation for part 90 continues to read as follows:

    Authority:  46 U.S.C. 3306, 3703; Pub. L. 103-206, 107 Stat.
2439; 49 U.S.C. 5103, 5106; E.O. 12234, 45 FR 58801; 3 CFR, 1980
Comp., p. 277; Department of Homeland Security Delegation No.
0170.1.

0
12. Revise Table 90.05-1(a) to read as follows:

Sec.  90.05-1  Vessels subject to the requirements of this subchapter.

    (a) * * *
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BILLING CODE 9110-04-C

* * * * *

PART 114--GENERAL PROVISIONS

0
13. The authority citation for part 114 continues to read as follows:

    Authority: 46 U.S.C. 2103, 3306, 3703; Pub. L. 103-206, 107
Stat. 2439; 49 U.S.C. App. 1804; Department of Homeland Security
Delegation No. 0170.1; Sec.  114.900 also issued under 44 U.S.C.
3507.

0
14. Section 114.110 is amended by revising paragraph (a)(3) and adding
a new paragraph (a)(4) before the Note to paragraph (a) to read as
follows:

Sec.  114.110  General applicability.

* * * * *
    (a) * * *
    (3) If a submersible vessel, carries at least one passenger for
hire; or
    (4) Is a ferry carrying more than 150 passengers, or having
overnight accommodations for more than 49 passengers.
* * * * *

0
15. Section 114.400(b) is amended by revising the definition for
``Ferry'' to read as follows:

Sec.  114.400  Definitions of terms used in this subchapter.

* * * * *
    (b) * * *
    ``Ferry'' means a vessel that is used on a regular schedule--(1) To
provide transportation only between places that are not more than 300
miles apart; and
    (2) To transport only--
    (i) Passengers; or
    (ii) Vehicles, or railroad cars, that are being used, or have been
used, in transporting passengers or goods.
* * * * *

PART 175--GENERAL PROVISIONS

0
16. The authority citation for part 175 continues to read as follows:

    Authority: 46 U.S.C. 2103, 3205, 3306, 3703; Pub. L. 103-206,
107 Stat. 2439; 49 U.S.C. App. 1804; Department of Homeland Security
Delegation No. 0170.1; 175.900 also issued under authority of 44
U.S.C. 3507.

0
17. Section 175.110 is amended by redesignating the ``Note to Sec.
175.110'' as ``Note to paragraph (a)'', revising paragraph (a)(4) and
adding paragraph (a)(5) to read as follows:

Sec.  175.110  General applicability.

* * * * *
    (4) If a submersible vessel, carries at least one passenger for
hire; or
    (5) Is a ferry carrying more than six passengers.
* * * * *

0
18. Section 175.400 is amended by revising the definition for ``Ferry''
to read as follows:

Sec.  175.400  Definitions of terms used in this subchapter.

* * * * *
    Ferry means a vessel that is used on a regular schedule--
    (1) To provide transportation only between places that are not more
than 300 miles apart; and
    (2) To transport only--
    (i) Passengers; or
    (ii) Vehicles, or railroad cars, that are being used, or have been
used, in transporting passengers or goods.
* * * * *

PART 188--GENERAL PROVISIONS

0
19. The authority citation for part 188 continues to read as follows:

    Authority: 46 U.S.C. 2113, 3306; Pub. L. 103-206, 107 Stat.
2439; 49 U.S.C. 5103, 5106; E.O. 12234, 45 FR 58801; 3 CFR, 1980
Comp., p. 277; Department of Homeland Security Delegation No.
0170.1.

0
20. Revise Table 188.05-1(a) to read as follows:

Sec.  188.05-1  Vessels subject to requirements of this subchapter.

    (a) * * *
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* * * * *

    Dated: November 23, 2009.
Stefan G. Venckus,
Chief, Office of Regulations and Administrative Law, United States
Coast Guard.
[FR Doc. E9-28473 Filed 12-3-09; 8:45 am]

BILLING CODE 9110-04-C


[Federal Register Volume 81, Number 48 (Friday, March 11, 2016)]
[Rules and Regulations]
[Page 12821]
[FR Doc No: C1-2016-03178]

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SECURITIES AND EXCHANGE COMMISSION

17 CFR Part 240

[Release No. 34-77104; File No. S7-06-15]
RIN 3235-AL73

Security-Based Swap Transactions Connected With a Non-U.S.
Person's Dealing Activity That Are Arranged, Negotiated, or Executed by
Personnel Located in a U.S. Branch or Office or in a U.S. Branch or
Office of an Agent; Security-Based Swap Dealer De Minimis Exception

Correction

    In rule document 2016-03178, appearing on pages 8598-8637, in the
issue of Friday, February 19, 2016, make the following corrections:
    1. On page 8604, at the bottom of the page, footnotes 55, 56, 57,
58, and 59 were inadvertently duplicated and these duplicate set of
footnotes should not have appeared in the published document.
    2. On page 8605, in the second column, the heading titled ``e.
Current Estimates of Number of Security-Based Wwap Dealers'' should
read ``e. Current Estimates of Number of Security-Based Swap Dealers''.
    3. On page 8606, at the bottom page, footnote 75 was inadvertently
duplicated and this duplicate footnote should not have appeared in the
published document.
    4. On page 8606, at the bottom of the page, footnote 77 was
inadvertently omitted and it should have appeared as follows:
    ``\77\ Commission staff analysis of TIW transaction records
indicates that approximately 99 percent of single-name CDS price-
forming transactions in 2014 involved an ISDA-recognized dealer.''
    5. On page 8611, at the bottom of the page, in the first column,
footnote 107, should read:
    ``\107\ See Section II.A.3, supra, for an analysis of the
proportion of the security-based swap market that constitutes
interdealer transactions. For the purposes of this analysis we classify
any security-based swap transaction between two ISDA-recognized dealers
as interdealer activity.''

[FR Doc. C1-2016-03178 Filed 3-10-16; 8:45 am]
 BILLING CODE 1505-01-D