[Federal Register Volume 80, Number 115 (Tuesday, June 16, 2015)]
[Notices]
[Pages 34471-34473]
[FR Doc No: 2015-14670]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75141; File No. SR-NASDAQ-2015-060]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend Chapter VI, Section 18 of the Exchange's Options Rules

June 10, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\, and Rule 19b-4 \2\ thereunder, notice is hereby given
that, on June 4, 2015, 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 Chapter VI, Section 18 of the
Exchange's options rules.
    The text of the proposed rule change is below; proposed new
language is italicized; proposed deletions are in brackets.
* * * * *

NASDAQ Stock Market Rules

* * * * *
Options Rules
* * * * *

Chapter VI Trading Systems

* * * * *
Sec. 18 Order Price Protection
    Order Price Protection (``OPP'') is a feature of the System that
prevents certain day limit, good til cancelled, and immediate or cancel
orders at prices outside of pre-set standard limits from being accepted
by the System. OPP applies to all options but does not apply to market
orders or Intermarket Sweep Orders.
    (a) OPP is operational each trading day after the opening until the
close of trading, except during trading halts. [The Exchange may also
temporarily deactivate OPP from time to time on an intraday basis at
its discretion if it determines that volatility warrants deactivation.
Participants will be notified of intraday OPP deactivation due to
volatility and any subsequent intraday reactivation by the Exchange
through the issuance of system status messages.]
    (b) OPP will reject incoming orders that exceed certain parameters
according to the following algorithm:
    (i) If the better of the NBBO or the internal market BBO (the
``Reference BBO'') on the contra-side of an incoming order is greater
than $1.00, orders with a limit more than 50% through such contra-side
[NBBO] Reference BBO will be rejected by the System upon receipt. For
example, if the [NBBO] Reference BBO on the offer side is $1.10, an
order to buy options for more than $1.65 would be rejected. Similarly,
if the [NBBO] Reference BBO on the bid side is $1.10, an order to sell
options for less than $0.55 will be rejected.
    (ii) If the [NBBO] Reference BBO on the contra-side of an incoming
order is less than or equal to $1.00, orders with a limit more than
100% through such contra-side [NBBO] Reference BBO will be rejected by
the System upon receipt. For example, if the [NBBO] Reference BBO on
the offer side is $1.00, an order to buy options for more than $2.00
would be rejected. However, if the [NBBO] Reference BBO of the bid side
of an incoming order to sell is less than or equal to $1.00, the OPP
limits set forth above will result in all incoming sell orders being
accepted regardless of their limit.
* * * * *

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 purpose of the proposed rule change is to amend and correct
Chapter VI, Section 18 of the NOM Rulebook which describes Order Price
Protection (``OPP''), a feature of the NOM trading system that prevents
certain day limit, good till cancelled, and immediate or cancel orders
at prices outside of pre-set standard limits from being accepted by the
System. The amendments also remove language providing for the temporary
deactivation of OPP from time to time on an intraday basis at the
Exchange's discretion if the Exchange determines that volatility
warrants deactivation.
    OPP applies to all options but does not apply to market orders or
Intermarket Sweep Orders. OPP is operational each trading day after the
opening until the close of trading, except during trading halts.
Chapter VI, Section 18 also currently provides that the Exchange may
temporarily deactivate OPP from time to time on an intraday basis at
its discretion if it determines that volatility warrants deactivation.
Participants are notified of

intraday OPP deactivation due to volatility and any subsequent intraday
reactivation by the Exchange through the issuance of system status
messages.
    OPP rejects incoming orders that exceed certain parameters.
Currently, Chapter VI, Section 18(b) establishes those parameters with
reference to the NBBO. It states that if the NBBO on the contra-side of
an incoming order is greater than $1.00, orders with a limit more than
50% through such contraside NBBO will be rejected by the system upon
receipt. For example, the rule provides that if the NBBO on the offer
side is $1.10, an order to buy options for more than $1.65 would be
rejected. Similarly, the rule states that if the NBBO on the bid side
is $1.10, an order to sell options for less than $0.55 will be
rejected. The rule provides that if the NBBO on the contra-side of an
incoming order is less than or equal to $1.00, orders with a limit more
than 100% through such contra-side NBBO will be rejected by the system
upon receipt. For example, under the rule if the NBBO on the offer side
is $1.00, an order to buy options for more than $2.00 would be
rejected. However, the rule provides that if the NBBO of the bid side
of an incoming order to sell is less than or equal to $1.00, the OPP
limits set forth above will result in all incoming sell orders being
accepted regardless of their limit.
    The Exchange has determined that a discrepancy exists between this
rule description of how the OPP process works and how the system
actually functions in cases where Price Improving Orders are present.
Price Improving Orders may be submitted in $0.01 increments on NOM
rather than at the minimum price variation (``MPV'').\3\ These Price
Improving Orders are considered part of the Exchange's internal market
BBO at their non-MPV limit and are displayed at the allowable MPV price
as part of the NBBO. While Chapter VI, Section 18 states that the NBBO
is used for OPP determinations as described above, the system is
actually basing OPP determinations on the better of (a) the NBBO, or
(b) the Exchange's internal market BBO, which may differ from the NBBO
due to the presence of Price Improving Orders. The Exchange is
proposing to correct this discrepancy by deleting the term ``NBBO'' in
each instance where it appears in Chapter VI, Section 18 and replacing
it with the term ``Reference BBO'' which will be defined in the rule as
the better of the NBBO or the internal market BBO.
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    \3\ See Chapter VI, Section 1, which provides that Price
Improving Orders are orders to buy or sell an option at a specified
price at an increment smaller than the minimum price variation in
the security. Price Improving Orders may be entered in increments as
small as one cent. Price Improving Orders that are available for
display shall be displayed at the minimum price variation in that
security and shall be rounded up for sell orders and rounded down
for buy orders.
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    Finally, the Exchange is removing from Chapter VI, Section 18 the
statements that the Exchange may temporarily deactivate OPP from time
to time on an intraday basis at its discretion if it determines that
volatility warrants deactivation, and that members will be notified of
intraday OPP deactivation due to volatility and any subsequent intraday
reactivation by the Exchange through the issuance of system status
messages. The Exchange currently lacks the technology to implement
intraday OPP deactivation and is deleting the language which suggests
that it has such capability.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act in general, and furthers the objectives of Section
6(b)(5) of the Act 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 amending and correcting the rule text to that it accurately reflects
the functioning of the trading system. The amendments concerning the
Reference BBO and the elimination of references to intraday
deactivation of the OPP are both intended to improve the accuracy of
the rule. The Exchange believes that the amendments should promote just
and equitable principles of trade as well as protect investors and the
public interest by making clear how OPP determinations are actually
made on the Exchange and by eliminating the potential for confusion
inherent in the statement that the Exchange may temporarily deactivate
OPP on an intraday basis when in fact it lacks the technical capacity
to do so. Calculating OPP on the basis of the better of the NBBO or the
internal market BBO rather than solely on the basis of the NBBO
protects investors and the public interest by extending the benefits of
OPP to orders received in instances where the internal market BBO is
better than the NBBO.

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, as the amendments to Chapter
VI, Section 18 will apply uniformly to all market participants availing
themselves of the OPP feature. Nor will the proposal impose a burden on
competition among the options exchanges, because of the vigorous
competition for order flow among the options exchanges. To the extent
that market participants disagree with the particular approach taken by
the Exchange herein, market participants can easily and readily direct
order flow to competing venues.

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

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

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) of the Act \4\ and Rule 19b-
4(f)(6) thereunder.\5\
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    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 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 Commission has determined to waive the five-day pre-filing
period in this case.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \6\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6) \7\ permits the Commission to
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange believes
that waiving the 30-day operative delay is consistent with the
protection of investors and the public interest because it would allow
the Exchange to immediately correct the inaccuracy with respect to the
NBBO described above, as well as eliminate language suggesting the
Exchange possesses the capability to temporarily deactivate OPP on an
intraday basis when in fact this is not the case. The Exchange believes
that the public interest would not be served by preserving these
inaccuracies in its rules during a notice and comment period for

this proposed rule change. The Commission believes that waiving the 30-
day operative delay \8\ is consistent with the protection of investors
and the public interest and designates the proposal operative on
filing.
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    \6\ 17 CFR 240.19b-4(f)(6).
    \7\ 17 CFR 240.19b-4(f)(6).
    \8\ For purposes only of waiving the 30-day operative delay, the
Commission has considered the proposed rule's impact on efficiency,
competition, and capital formation. See 15 U.S.C. 78c(f).
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is 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 will institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NASDAQ-2015-060 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-2015-060. 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-060 and should be
submitted on or before July 7, 2015.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-14670 Filed 6-15-15; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: December 20, 2007 (Volume 72, Number 244)]
[Proposed Rules]
[Page 72322-72325]
[DOCID:fr20de07-25]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2007-0970; FRL-8508-7]

Revision to the California State Implementation Plan, Bay Area
Air Quality Management District

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing approval of a revision to the Bay Area Air
Quality Management District (BAAQMD) portion of the California State
Implementation Plan (SIP). This revision concerns nitrogen oxides
(NOX) and carbon monoxide (CO) emissions from boilers, steam
generators and process heaters at petroleum refineries. We are
proposing to approve a local rule that regulates these emission sources
under the Clean Air Act as amended in 1990 (CAA or the Act). We are
taking comments on this proposal and plan to follow with a final
action.

DATES: Any comments must arrive by January 22, 2008.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2007-0970, by one of the following methods:
    1. Federal eRulemaking Portal: http://www.regulations.gov. Follow the on-

line instructions.
    2. E-mail<EMAIL_ADDRESS>    3. Mail or deliver: Andrew Steckel (Air-4), U.S. Environmental
Protection Agency Region IX, 75 Hawthorne Street, San Francisco, CA
94105-3901.
    Instructions: All comments will be included in the public docket
without change and may be made available online at http://www.regulations.gov,

including any personal information provided, unless the comment
includes Confidential Business Information (CBI) or other information
whose disclosure is restricted by statute. Information that you
consider CBI or otherwise protected should be clearly identified as
such and should not be submitted through http://www.regulations.gov or e-mail.

http://www.regulations.gov is an ``anonymous access'' system, and EPA will not

know your identity or contact information unless you provide it in the
body of your comment. If you send e-mail directly to EPA, your e-mail
address will be automatically captured and included as part of the
public comment. If EPA cannot read your comment due to technical
difficulties and cannot contact you for clarification, EPA may not be
able to consider your comment.

    Docket: The index to the docket for this action is available
electronically at http://www.regulations.gov and in hard copy at EPA Region

IX, 75 Hawthorne Street, San Francisco, California. While all documents
in the docket are listed in the index, some information may be publicly
available only at the hard copy location (e.g., copyrighted material),
and some may not be publicly available in either location (e.g., CBI).
To inspect the hard copy materials, please schedule an appointment
during normal business hours with the contact listed in the FOR FURTHER
INFORMATION CONTACT section.

FOR FURTHER INFORMATION CONTACT: Andrew Steckel, EPA Region IX, (415)
947-4115<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and
``our'' refer to EPA.

Table of Contents

I. The State's Submittal
    A. What rule did the State submit?
    B. Are there other versions of this rule?
    C. What is the purpose of the submitted rule?
II. EPA's Evaluation
    A. EPA's Previous Action
    B. How is EPA evaluating the rule?
    C. Why is EPA re-proposing to approve this rule?
    D. Public Comments and EPA Responses
III. EPA Action
IV. Statutory and Executive Order Reviews

I. The State's Submittal

A. What rule did the State submit?

    EPA is proposing to approve BAAQMD Rule 9-10, Nitrogen Oxides and
Carbon Monoxide from Boilers, Steam Generators, and Process Heaters in
Petroleum Refineries, adopted by the BAAQMD on July 17, 2002, and
submitted by the California Air Resources Board on August 12, 2002. On
September 11, 2002, this rule submittal was found to meet the
completeness criteria in 40 CFR part 51 Appendix V, which must be met
before formal EPA review.

B. Are there other versions of this rule?

    BAAQMD adopted an earlier version of this rule on January 5, 1994,
and CARB submitted it to us on July 23, 1996. We published a limited
approval and limited disapproval of this previous version of Rule 9-10
into the SIP on March 29, 2001 (66 FR 17078).

C. What is the purpose of the submitted rule?

    Rule 9-10 limits the emissions of nitrogen oxides (NOX)
and carbon monoxide from boilers, steam generators, and process heaters
in petroleum refineries. NOX emissions contribute to
producing ground-level ozone, smog and particulate matter, which harm
human health and the environment. Section 110(a) of the CAA requires
States to submit regulations that control NOX emissions.

II. EPA's Evaluation

A. EPA's Previous Action

    On March 29, 2001 (66 FR 17078), EPA published a limited approval
and limited disapproval of a previous version of this rule, because the
rule improved the SIP overall, but some rule provisions failed to
satisfy the requirements of section 110 of the CAA. On August 12, 2002,
BAAQMD submitted a revised version of Rule 9-10 for approval into the
SIP, to address the deficiencies identified by EPA in 2001.
    On October 7, 2002 (67 FR 62389), EPA published a direct final rule
to approve this revised version of BAAQMD Rule 9-10 into the California
SIP. In association with the direct final rule, EPA published a
proposed rule to allow an opportunity for the public to comment on the
approval of Rule 9-10 into the California SIP (67 FR 62427). Based on
the proposed approval of Rule 9-10, EPA made an interim final
determination to stay the imposition of sanctions that resulted from
the March 29, 2001, limited disapproval action. The interim final rule
to stay the imposition of sanctions was published concurrently on
October 7, 2002 (67 FR 62388).
    Adverse comments were received in response to the October 7, 2002,
proposed rule. As a result, EPA published a withdrawal of the direct
final rule on November 25, 2002 (67 FR 70555). The proposed approval
remained in effect, and therefore the interim final determination
regarding sanctions was not affected by the withdrawal because the
determination was based on the proposed approval of Rule 9-10. The
comments received are being addressed in today's proposed rule.

B. How is EPA evaluating the rule?

    Generally, SIP rules must be enforceable (see section 110(a) of the
Act), must require Reasonably Available Control Technology (RACT) for
each category of sources covered by a Control Techniques Guidelines
(CTG) document as well as each major source in nonattainment areas (see
sections 182(a)(2) and 182(f)), and must not relax existing
requirements (see sections 110(l) and 193). However, as further
explained in our response to public comments below, we believe that
Rule 9-10 is not required to fulfill RACT or Reasonably Available
Control Measures (RACM) to be approved into the SIP. Therefore, BAAQMD
Rule 9-10 was primarily evaluated for enforceability and whether it
would relax existing SIP requirements.
    As mentioned in the October 7, 2002, proposed approval, the
guidance and policy documents that we use to help evaluate
enforceability and other general requirements consistently include the
following:
    1. ``State Implementation Plans; Nitrogen Oxides Supplement to the
General Preamble; Clean Air Act Amendments of 1990 Implementation of
Title I; Proposed Rule,'' (the NOX Supplement), 57 FR 55620,
November 25, 1992.
    2. ``Issues Relating to VOC Regulation Cutpoints, Deficiencies, and
Deviations,'' EPA, May 25, 1988 (the Bluebook).
    3. ``Guidance Document for Correcting Common VOC & Other Rule
Deficiencies,'' EPA Region 9, August 21, 2001 (the Little Bluebook).
    We believe BAAQMD Rule 9-10 meets the evaluation criteria and is
consistent with the relevant policy and guidance regarding
enforceability and SIP relaxations.

C. Why is EPA re-proposing to approve this rule?

    In our proposed action on October 7, 2002, we stated that BAAQMD
Rule 9-10 must fulfill RACT and that the rule was consistent with the
relevant policy and guidance regarding RACT (67 FR 62386). As further
explained in our response to public comments below, we have re-
evaluated whether Rule 9-10 is subject to federal RACT requirements in
CAA section 182(f). We believe that Rule 9-10 is not required to
fulfill RACT to be approved into the SIP. Additionally, as a marginal
8-hour ozone nonattainment area, the BAAQMD is not required to submit
an attainment demonstration showing that it has adopted all necessary
RACM. See 70 FR 71659. In today's action, we are again proposing to
fully approve BAAQMD Rule 9-10 into the SIP. In this proposed rule, we
are giving the public an opportunity to review and comment on the
changes in our evaluation of the rule.

D. Public Comments and EPA Responses

    EPA's proposed action on October 7, 2002, provided a 30-day public
comment period. During this period, we received comments from the
following parties:
    1. Brigette Tollstrup, Sacramento Metropolitan Air Quality
Management

District (SMAQMD); letter dated October 23, 2002, and received October
30, 2002.
    2. Ken Kloc, Our Children's Earth Foundation (OCE); letter dated
November 6, 2002, and received November 12, 2002.
    3. Suma Peesapati, Community for a Better Environment (CBE); letter
dated November 6, 2002, and received November 12, 2002.
    4. Peter Hess, Bay Area Air Quality Management District (BAAQMD);
letter dated November 30, 2002. The BAAQMD letter, in support of the
EPA approval action, was received after the close of the comment
period. However, we considered BAAQMD comments and included information
from the BAAQMD in our responses.
    The comments and our responses are summarized below.
    Comment 1: SMAQMD and CBE contend that sources of NOX in
the BAAQMD must implement RACT under section 182(f) of the Act because
the BAAQMD's redesignation plan, which relied on Rule 9-10 as a
maintenance measure, was disapproved and ``the NOX waiver''
revoked by EPA. See 63 FR 37258. CBE further contends that the BAAQMD
must implement all RACM under section 172(c)(1) of the Act.
    Response 1: The BAAQMD contends and EPA agrees that Rule 9-10 is
not subject to federal RACT requirements in CAA section 182(f). Since
the early 1990's, the Bay Area has fluctuated in and out of attainment
with respect to the National Ambient Air Quality Standard (NAAQS) for
ozone. Despite being designated as a nonattainment area under both the
1-hour and the recently promulgated 8-hour ozone standards, the Bay
Area has not been subject to the NOX RACT requirements
contained in CAA section 182(f) since the early 1990's as explained
below.
     From 1990 to 1992, the Bay Area did not experience any
exceedances of the original 1-hour ozone NAAQS and submitted requests
to EPA for redesignation to attainment and for a waiver of the CAA
section 182(f) NOX RACT requirements. The request for ``the
NOX waiver'' was based on a claim by the BAAQMD that a
modeling analysis indicated that additional NOX reductions
would tend to raise local Bay Area ozone levels. On May 22, 1995, EPA
redesignated the Bay Area to attainment and granted the BAAQMD's
request for the NOX waiver. See 60 FR 27028. As a result,
the BAAQMD was not subject to the section 182(f) NOX RACT
requirements.
     From 1995 to 1996, the Bay Area experienced a number of
exceedances of the 1-hour NAAQS. As a result, EPA redesignated the Bay
Area to nonattainment and revoked ``the NOX waiver'' on July
10, 1998. See 63 FR 37258. Under certain circumstances, the
redesignation may have required that the BAAQMD impose NOX
RACT requirements, however, EPA's redesignation was made pursuant to
our authority in part D, subpart 1 of the Act, which does not impose
specific NOX RACT requirements. As stated in our final
rulemaking, ``[b]ecause the Bay Area is being redesignated under
subpart 1 of the Act, there are no mandatory NOX measures
which must be adopted.'' See 63 FR 37273. Specific NOX RACT
requirements are found in part D, subpart 2. Therefore, the BAAQMD was
not subject to the CAA section 182(f) NOX RACT requirements.
     With additional exceedances of the 1-hour NAAQS from 1999
to 2000, EPA made a formal finding on September 20, 2001, that the Bay
Area had not attained the standard, and EPA disapproved the BAAQMD's
1999 Ozone Attainment Plan. See 66 FR 48340. This finding required that
the BAAQMD submit a new ozone attainment plan. However, the CAA section
182(f) NOX RACT requirements were still not necessary
because BAAQMD's nonattainment status was established under part D,
subpart 1 of the Act in our 1998 rulemaking.
     From 2001 to 2003, the Bay Area did not experience any
exceedances of the 1-hour NAAQS. As a result, EPA made a finding of
attainment on April 22, 2004, which would also serve to relieve the
BAAQMD of any possible unmet obligations with regard to RACT it may
have had under the 1-hour standard. See 69 FR 21717.
     On June 15, 2004, EPA's designation of the Bay Area as an
8-hour ozone marginal nonattainment area became effective. See 69 FR
23857. As with all marginal areas, the BAAQMD is not required to submit
a SIP that meets RACT. See ``Final Rule to Implement the 8-hour Ozone
NAAQS--Phase 2,'' 70 FR 71653.
    With regard to the section 172(c)(1) requirement that nonattainment
areas must provide for RACM, we have interpreted this requirement to
mean that it would not be reasonable to require implementation of those
measures which might in fact be available for implementation yet would
not advance the area's attainment date. See id. at 71653. Because we
have determined that the Bay Area attained the revoked 1-hour ozone
NAAQS (see 69 FR 21717), Rule 9-10 would not be expected to advance the
Bay Area's attainment date and, therefore, would not be considered a
necessary RACM measure under section 172(c)(1). Additionally, as a
marginal 8-hour ozone nonattainment area, the BAAQMD is not required to
submit an attainment demonstration showing that it has adopted all RACM
necessary. See 70 FR 71659.
    Comment 2: SMAQMD, OCE and CBE commented that Rule 9-10 contains
several provisions that do not satisfy the RACT requirements of CAA
section 182(f), citing more stringent standards imposed by other air
pollution control agencies in California. These stricter provisions
should be considered technologically feasible because they have been
adopted in other areas and should therefore be required to be
implemented by nonattainment areas including the BAAQMD.
    Response 2: The BAAQMD is not required to submit rules which
satisfy the RACT requirements of section 182(f). See Response 1 for a
more detailed explanation.
    Comment 3: SMAQMD, OCE and CBE highlight more stringent limits that
were adopted by the BAAQMD but not submitted to EPA for approval into
the SIP. SMAQMD and OCE argue that the adoption of a more stringent
standard by the BAAQMD is further evidence that the submitted limits do
not represent RACT.
    Response 3: As discussed in Response 1, the BAAQMD need not submit
regulations containing RACT requirements. The BAAQMD argues that the
rule provisions which were not submitted to EPA for inclusion in the
SIP implement California Best Available Retrofit Control Technology
(BARCT). Measures necessary to meet California's more stringent air
quality standards are not required to meet the NAAQS and therefore need
not be submitted to EPA for inclusion in the SIP. The BAAQMD has
determined which provisions of Rule 9-10 are necessary to meet the
NAAQS and submitted them to EPA. The omission from the submitted
version of Rule 9-10 of the other more stringent limits cited by the
commenters does not affect EPA's ability to independently evaluate the
submitted version of Rule 9-10 against applicable CAA requirements.
    Comment 4: CBE urged EPA to require BAAQMD to submit the entire
rule for inclusion in the SIP as required by the Act. CBE had requested
that the BAAQMD include Rule 9-10, in its entirety, in the BAAQMD's
2001 and Revised 2001 Ozone Attainment Plans. CBE requests that EPA
remedy the situation by requiring the BAAQMD to submit all provision of
Rule 9-10.
    Response 4: See Response 3.

    Comment 5: OCE requested that EPA conduct a RACT evaluation of Rule
9-10 and re-propose approval of Rule 9-10 once that evaluation is
complete.
    Response 5: A RACT evaluation of Rule 9-10 is not required. For
further discussion regarding RACT requirements in the BAAQMD, see
Response 1.

III. EPA Action

    Because EPA believes the submitted rule fulfills all relevant
requirements, we are proposing to fully approve it as described in
section 110(k)(3) of the Act. We will accept comments from the public
on this proposal for the next 30 days. Unless we receive convincing new
information during the comment period, we intend to publish a final
approval action that will incorporate this rule into the federally
enforceable SIP.
    All sanctions and sanction clocks, which were triggered as a result
of the disapproval action on March 29, 2001 (66 FR 17078), continue to
be stayed as a result of the interim final determination published on
October 7, 2002 (67 FR 62388). The comments received in response to the
October 7, 2002, proposed rule approval have not changed our conclusion
that the submitted rule complies with the relevant CAA requirements.
The sanctions and sanction clocks will be permanently terminated on the
effective date of the final rule approval.

IV. Statutory and Executive Order Reviews

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
proposed action is not a ``significant regulatory action'' and
therefore is not subject to review by the Office of Management and
Budget. For this reason, this action is also not subject to Executive
Order 13211, ``Actions Concerning Regulations That Significantly Affect
Energy Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001). This
proposed action merely proposes to approve State law as meeting Federal
requirements and imposes no additional requirements beyond those
imposed by State law. Accordingly, the Administrator certifies that
this proposed rule will not have a significant economic impact on a
substantial number of small entities under the Regulatory Flexibility
Act (5 U.S.C. 601 et seq.). Because this rule proposes to approve
preexisting requirements under State law and does not impose any
additional enforceable duty beyond that required by State law, it does
not contain any unfunded mandate or significantly or uniquely affect
small governments, as described in the Unfunded Mandates Reform Act of
1995 (Pub. L. 104-4).
    This proposed rule also does not have tribal implications because
it will 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, as specified by Executive
Order 13175 (65 FR 67249, November 9, 2000). This action also does not
have Federalism implications because it does not have substantial
direct effects 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, as specified
in Executive Order 13132 (64 FR 43255, August 10, 1999). This action
merely proposes to approve a State rule implementing a Federal
standard, and does not alter the relationship or the distribution of
power and responsibilities established in the Clean Air Act. This
proposed rule also is not subject to Executive Order 13045 ``Protection
of Children From Environmental Health Risks and Safety Risks'' (62 FR
19885, April 23, 1997), because it approves a State rule implementing a
Federal standard.
    In reviewing SIP submissions, EPA's role is to approve State
choices, provided that they meet the criteria of the Clean Air Act. In
this context, in the absence of a prior existing requirement for the
State to use voluntary consensus standards (VCS), EPA has no authority
to disapprove a SIP submission for failure to use VCS. It would thus be
inconsistent with applicable law for EPA, when it reviews a SIP
submission, to use VCS in place of a SIP submission that otherwise
satisfies the provisions of the Clean Air Act. Thus, the requirements
of section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (15 U.S.C. 272 note) do not apply. This proposed rule does
not impose an information collection burden under the provisions of the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501, et seq.).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by
reference, Intergovernmental relations, Nitrogen dioxide, Ozone,
Reporting and recordkeeping requirements.

    Authority: 42 U.S.C. 7401, et seq.

    Dated: November 27, 2007.
Wayne Nastri,
Regional Administrator, Region IX.
 [FR Doc. E7-24715 Filed 12-19-07; 8:45 am]

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