[Federal Register Volume 80, Number 225 (Monday, November 23, 2015)]
[Notices]
[Pages 72999-73006]
[FR Doc No: 2015-29708]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76453; File No. SR-EDGX-2015-56]

Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change Related to
Fees

November 17, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on November 9, 2015, EDGX Exchange, Inc. (the ``Exchange'' or
``EDGX'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. The Exchange
has designated the proposed rule change as one establishing or changing
a member due, fee, or other charge imposed by the Exchange under
Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2)
thereunder,\4\ which renders the proposed rule change effective upon
filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange filed a proposal to amend the fee schedule applicable
to Members \5\ and non-members of the Exchange pursuant to EDGX Rules
15.1(a) and (c).
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    \5\ The term ``Member'' is defined as ``any registered broker or
dealer that has been admitted to membership in the Exchange.'' See
Exchange Rule 1.5(n).
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    The text of the proposed rule change is available at the Exchange's
Web site at www.batstrading.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 parts 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 adopt a fee schedule which would be
applicable to the Exchange's options platform (``EDGX Options'').
Specifically, the fee schedule would establish select fees applicable
to Members trading options on and using services provided by EDGX
Options. The Exchange proposes to implement these amendments to its fee
schedule immediately.\6\
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    \6\ The Exchange initially filed the proposed fees on October
30, 2015 (SR-EDGX-2015-54). On November 9, 2015, the Exchange
withdrew that filing and submitted this filing.
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Definitions
    The Exchange proposes to include general defined terms in its fee
schedule. The proposed definitions are designed to provide greater
transparency with regard to how the Exchange assesses fees and are
based on and nearly identical to those currently provided for in the
fee schedule for the equity options platform operated by BATS Exchange,
Inc. (``BZX Options'').\7\ Each of these definitions are as follows:
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    \7\ The Exchange notes that although there is no substantive
difference between the definitions, instead of ``Away Market
Maker'', which is the proposed term for EDGX Options, BZX Options
uses the term ``Non-BATS Market Maker.''

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     Per Contract. All references to ``per contract'' within
the fee schedule are to mean ``per contract executed''.
     Broker Dealer. Applies to any order for the account of a
broker dealer, including a foreign broker dealer, that clears in the
Customer range at the Options Clearing Corporation (``OCC'').
     Customer. Applies to any transaction identified by a
Member for clearing in the Customer range at the OCC, excluding any
transaction for a Broker Dealer or a ``Professional'' as defined in
Exchange Rule 16.1.
     Firm. Applies to any transaction identified by a Member
for clearing in the Firm range at the OCC, excluding any Joint Back
Office transaction.
     Joint Back Office. Applies to any transaction identified
by a Member for clearing in the Firm range at the OCC that is
identified with an origin code as Joint Back Office. A Joint Back
Office participant is a Member that maintains a Joint Back Office
arrangement with a clearing broker-dealer.
     Market Maker. Applies to any transaction identified by a
Member for clearing in the Market Maker range at the OCC, where such
Member is registered with the Exchange as a Market Maker as defined in
Rule 16.1(a)(37).
     Non-Customer. Applies to any transaction that is not a
Customer order.
     Away Market Maker. Applies to any transaction identified
by a Member for clearing in the Market Maker range at the OCC, where
such Member is not registered with the Exchange as a Market Maker, but
is registered as a market maker on another options exchange.
     Professional. Applies to any transaction identified by a
Member as such pursuant to Exchange Rule 16.1.
     Penny Pilot Securities. Are those issues quoted pursuant
to Exchange Rule 21.5, Interpretation and Policy .01.\8\
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    \8\ Exchange Rule 21.5, Interpretation and Policy .01 states
that the Exchange will operate a pilot program set to expire on June
30, 2016 to permit options classes to be quoted and traded in
increments as low as $.01. A list of option classes included in the
pilot program is available on the Exchange's Web site.
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Standard Transaction Fees
    The Exchange proposes to implement a fee structure under which
standard rates are applied, the amount of which depend on whether the
order is for a Customer, Non-Customer, or Market Maker as well as the
capacity of the order with which such order trades. The standard rates
and applicable fee codes described below would apply unless a Member's
transaction is assigned a fee code other than a standard fee code. A
fee code other than a standard fee code would only be applied to a
Member's transaction that is routed to and executed on another options
exchange or where it is to participate in the EDGX Options opening
process under Exchange Rule 21.7. Like on BZX Options, an order that
participates in the EDGX Options opening process would yield fee code
OO and would not be charged a fee nor receive any rebate.\9\
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    \9\ See the BZX Options fee schedule available at http://www.batsoptions.com/support/fee_schedule/bzx/.
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    Initially, the Exchange does not propose to implement a tiered
pricing structure under which it would provide enhanced rebates or
reduced fees based on the Member's monthly trading activity. Nor does
the Exchange propose to implement ``maker-taker'' pricing (i.e.,
providing a rebate to the side of the transaction that added liquidity
and a fee to the side of the transaction that removed liquidity).
    Customer vs. Customer. Neither side of a transaction will be
charged a fee where both sides trade in a Customer capacity. Such
Customer orders would yield either fee code PA or NA where they add
liquidity and PR or NR where they remove liquidity, depending on
whether the order is in a Penny Pilot Security or not.
    Customer vs. Non-Customer. An order that trades in a Customer
capacity will receive a rebate of $0.21 per contract where it executes
against a contra-side order that trades in a Non-Customer capacity.
Such Customer orders would yield either fee code PY or NY where they
add liquidity and PC or NC where they remove liquidity, depending on
whether the order is in a Penny Pilot Security or not.
    Market Maker vs. Customer. An order that trades in a Market Maker
capacity will be charged a fee of $0.21 per contract where it executes
against a contra-side order that trades in a Customer capacity. Such
Market Maker orders would yield either fee code PM or NM where they add
liquidity and PP or NP where they remove liquidity, depending on
whether the order is in a Penny Pilot Security or not.
    Non-Customer (other than Market Maker) vs. Customer. For Penny
Pilot Securities, an order that trades in a Non-Customer capacity,
other than a Market Maker, will be charged a fee of $0.46 per contract
where it executes against a contra-side order that trades in a Customer
capacity. Such Non-Customer orders in Penny Pilot Securities would
yield fee code PO where they add liquidity and PQ where they remove
liquidity. Such Non-Customer orders in Non-Penny Pilot Securities would
be charged a fee of $0.86 per contract and yield fee code NO where they
add liquidity and NQ where they remove liquidity.
    Non-Customer vs. Non-Customer. Neither side of a transaction will
be charged a fee where both sides trade in a Non-Customer capacity.
Such Non-Customer orders would yield either fee code PF or NF where
they add liquidity and PN or NN where they remove liquidity, depending
on whether the order is in a Penny Pilot Security or not.
Routing Fees
    The Exchange proposes to adopt rates for routed orders that
approximate the cost of routing to other options exchanges based on the
cost of transaction fees assessed by each venue as well as costs to the
Exchange for routing (i.e., clearing fees, connectivity and other
infrastructure costs, membership fees, etc.) (collectively, ``Routing
Costs''). The Exchange intends to monitor the fees charged as compared
to the costs of its routing services and adjust its routing fees to
ensure that the Exchange's fees do indeed result in a rough
approximation of overall Routing Costs, and are not significantly
higher or lower in any area. The proposed rates are based on the rates
charged by the Exchange's affiliate, BZX Options, for routing services.
Marketing Fees
    The Exchange will assess a marketing fee to all Market Makers for
contracts they execute in their assigned classes when the contra-party
to the execution is a Customer. The marketing fee is charged only in a
Market Maker's assigned classes because it is in these classes that the
Market Maker has the general obligation to attract order flow to the
Exchange. Each Primary Market Maker (``PMM'') \10\ and Directed Market
Maker (``DMM'') \11\ will have a marketing fee pool into which the
Exchange will deposit the applicable per-contract marketing fee. For
orders directed to DMMs, the applicable marketing fees are allocated to
the DMM pool. For non-directed orders, the applicable marketing fees
are allocated to the PMM pool. All Market Makers that participated in
such transaction will pay the applicable marketing fees to the
Exchange, which will allocate such funds to the Market Maker that
controls the distribution of the marketing fee pool. Each month the
Market Maker will provide instruction to the Exchange

describing how the Exchange is to distribute the marketing fees in the
pool to the order flow provider, who submit as agent, Customer orders
to the Exchange.
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    \10\ See Exchange Rule 21.8(g).
    \11\ See Exchange Rule 21.8(f).
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    Undisbursed marketing fees will be reimbursed to the Market Makers
that contributed to the pool based upon their pro-rata portion of the
entire amount of marketing fee collected. In order to provide PMMs and
DMMs flexibility in the timing of their disbursements to Electronic
Exchange Members, PMMs and DMMs may choose to disburse the Market Fees
collected in one month over a three month period. Reimbursement of
undisbursed Marketing Fees will take this into consideration.
    The amount of the Marketing Fee would depend upon whether the
affected option class is a Penny Pilot Security. A Marketing Fee of
$0.25 per contract will be assessed to Market Makers for transactions
in Penny Pilot Securities. A Marketing Fee of $0.65 per contract will
be assessed to Market Makers for transactions in Non-Penny Pilot
Securities. A list of option classes included in the Penny Pilot
Program is available on the Exchange's Web site. The Exchange's
marketing fees are the same as Miami International Securities Exchange,
Inc. (``MIAX''), Chicago Board Options Exchange, Inc. (``CBOE''),
International Securities Exchange, Inc. (``ISE''), the NYSE MKT LLC
(``NYSE MKT''), and the Nasdaq OMX PHLX LLC (``PHLX'') for transactions
in option classes that are Penny Pilot Securities. For option classes
that are Non-Penny Pilot Securities, the Exchange's Marketing Fees is
less than MIAX and PHLX ($0.70 each respectively) and equal to CBOE,
ISE and the NYSE MKT ($0.65 each respectively).
Port Fees
    The Exchange proposes to: (i) offer logical ports free of charge;
and (ii) adopt fees for physical connectivity.
    Logical Ports. The Exchange proposes to provide logical ports
(including Multicast PITCH Spin Server and GRP ports), as well as ports
with bulk quoting capabilities, free of charge. A logical port
represents a port established by the Exchange within the Exchange's
system for trading and billing purposes. Each logical port established
is specific to a Member or non-Member and grants that Member or non-
Member the ability to operate a specific application, such as FIX order
entry or PITCH data receipt. The Exchange's Multicast PITCH data feed
\12\ is available from two primary feeds, identified as the ``A feed''
and the ``C feed'', which contain the same information but differ only
in the way such feeds are received. The Exchange also offers two
redundant feeds, identified as the ``B feed'' and the ``D feed.'' The
Exchange also offers a bulk-quoting interface which allows Users \13\
of EDGX Options to submit and update multiple bids and offers in one
message through logical ports enabled for bulk-quoting. The bulk-
quoting application would allow Users to provide quotations in many
different options.
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    \12\ See Exchange Rule 21.15(b)(1).
    \13\ A User on EDGX Options is either a member of EDGX Options
or a sponsored participant who is authorized to obtain access to the
Exchange's system pursuant to Exchange Rule 11.3.
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    Physical Connectivity. The Exchange does, however, propose to adopt
fees for physical connectivity. A physical port is utilized by a Member
or non-Member to connect to the Exchange at the data centers where the
Exchange's servers are located. The Exchange currently maintains a
presence in two third-party data centers: (i) The primary data center
where the Exchange's business is primarily conducted on a daily basis,
and (ii) a secondary data center, which is predominantly maintained for
business continuity purposes. The Exchange proposes to assess the
following physical connectivity fees for Members and non-Members on a
monthly basis: $2,000 per physical port that connects to the System via
1 gigabyte circuit; and $4,000 per physical port that connects to the
System via 10 gigabyte circuit. The Exchange will pass-through in full
any fees or costs in excess of $1,000 incurred by the Exchange to
complete a cross-connect. These proposed fees are identical to those
currently provided for in the fee schedule applicable to the Exchange's
equities trading platform (``EDGX Equities'') and those of its
affiliates, BATS Exchange, Inc. (``BZX'') (including BZX Options), EDGA
Exchange, Inc. (``EDGA''), and BATS Y-Exchange, Inc. (``BYX'').\14\
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    \14\ See fee schedules for EDGX Equities, BZX, BZX Options,
EDGA, and BYX.
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Market Data Definitions and Product
    The Exchange proposes to include in its fee schedule the following
defined terms that relate to the Exchange's market data fees. The
proposed definitions are designed to provide greater transparency with
regard to how the Exchange provides for market data. The Exchange notes
that none of the proposed definitions are designed to adopt any fee.
Instead, the Exchange is adopting definitions to avoid confusion for
Members and non-Members who are familiar with market data fees on other
exchanges, including the Exchange's affiliates. Each of these
definitions are identical to those currently provided for in the
Exchange's equities fee schedule and those of its affiliates.\15\
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    \15\ Id.
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    First, a ``Distributor'' of an Exchange Market Data product would
be defined as any entity that receives the Exchange Market Data product
directly from the Exchange or indirectly through another entity and
then distributes it internally or externally to a third party. An
``Internal Distributor'' of an Exchange Market Data product would be
defined as a Distributor that receives the Exchange Market Data product
and then distributes that data to one or more Users within the
Distributor's own entity. Meanwhile, an ``External Distributor'' of an
Exchange Market Data product would be defined as a Distributor that
receives the Exchange Market Data product and then distributes that
data to a third party or one or more Users outside the Distributor's
own entity.
    A ``User'' of an Exchange Market Data product would be defined as a
natural person, a proprietorship, corporation, partnership, or entity,
or device (computer or other automated service), that is entitled to
receive Exchange data. A ``Non-Professional User'' of an Exchange
Market Data product would be defined as a natural person who is not:
(i) Registered or qualified in any capacity with the Commission, the
Commodity Futures Trading Commission, any state securities agency, any
securities exchange or association, or any commodities or futures
contract market or association; (ii) engaged as an ``investment
adviser'' as that term is defined in Section 202(a)(11) of the
Investment Advisers Act of 1940 (whether or not registered or qualified
under that Act); or (iii) employed by a bank or other organization
exempt from registration under federal or state securities laws to
perform functions that would require registration or qualification if
such functions were performed for an organization not so exempt.
Lastly, a ``Professional User'' of an Exchange Market Data product
would be defined as any User other than a Non-Professional User.
    The Exchange will offer a market data product called Multicast
PITCH.\16\ Multicast PITCH is an uncompressed data feed that offers
depth of book quotations and execution information based on options
orders entered into the System. The Exchange proposes to offer the
Multicast PITCH feed free of charge.
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    \16\ See Exchange Rule 21.15(b)(1).

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BATS Connect
    In December 2014, the Exchange filed a proposed rule change with
the Commission to adopt a communication and routing service now known
as BATS Connect.\17\ The Exchange now proposes to adopt fees related to
the use of BATS Connect that are equal to the fees charged for an
identical service, also called BATS Connect, offered by the Exchange's
affiliates. The Exchange notes that BATS Connect is offered by all of
the Exchange's affiliated exchanges. The Exchange believes that the
fees should also be appropriately set forth on the fee schedule of EDGX
Options because BATS Connect will be offered to all Exchange Members,
including Members that participate primarily or exclusively on EDGX
Options.
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    \17\ See the EDGX equities fee schedule available at http://batstrading.com/support/fee_schedule/edgx/. See also Securities
Exchange Act Release Nos. 73780 (December 8, 2014), 79 FR 73942
(December 12, 2014) (SR-EDGX-2014-28); and 75150 (June 11, 2015), 80
FR 34772 (June 17, 2015) (SR-EDGX-2015-27).
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    BATS Connect is offered by the Exchange on a voluntary basis in a
capacity similar to a vendor. In sum, BATS Connect is a communication
service that provides subscribers an additional means to receive market
data from and route orders to any destination connected to the
Exchange's network. BATS Connect does not provide any advantage to
subscribers for connecting to the Exchange's affiliates as compared to
other methods of connectivity available to subscribers. The servers of
the subscriber need not be located in the same facilities as the
Exchange in order to subscribe to BATS Connect. Subscribers may also
seek to utilize BATS Connect in the event of a market disruption where
other alternative connection methods become unavailable.
    The Exchange will charge a monthly connectivity fee to subscribers
utilizing BATS Connect to route orders to other exchanges and broker-
dealers that are connected to the Exchange's network. The amount of the
connectivity fee varies based solely on the bandwidth selected by the
subscriber. Specifically, the Exchange proposes to charge $350 for 1
Mb, $700 for 5 Mb, $950 for 10 Mb, $1,500 for 25 Mb, $2,500 for 50 Mb,
and $3,500 for 100 Mb.
    BATS Connect allows subscribers to receive market data feeds from
the exchanges connected to the Exchange's network. In such case, the
subscriber would pay the Exchange a connectivity fee, which varies and
is based solely on the amount of bandwidth required to transmit the
selected data product to the subscriber. The proposed connectivity fees
are set forth in the Exhibit 5 attached hereto and range from no charge
to $11,500 based on the market data product the subscriber selects.
    The Exchange also proposes to adopt a discounted fee of $4,160 per
month for subscribers who purchase connectivity to a bundle of select
market data products. The following market data products would be
included in the bundle: UQDF/UTDF/OMDF, CQS/CTS, Nasdaq TotalView,
Nasdaq BX TotalView, Nasdaq PSX TotalView, NYSE ArcaBook, NYSE MKT
OpenBook Ultra, and BBS/TTDS. Absent the discount, a subscriber
purchasing connectivity through BATS Connect for each of these market
data products would pay a total monthly fee of $5,200. As proposed, a
subscriber who purchases connectivity to each of the above market data
products would be charged a monthly fee of $4,160, which represents a
20% discount. The subscribers would pay any fees charged by the
exchange providing the market data feed directly to that exchange.
    The Exchange notes that it will not charge a fee to subscribers
utilizing BATS Connect to route orders to or receive market data
products from the Exchange's affiliates, EDGA, BZX (including BZX
Options), and BYX. BATS Connect provides subscribers a means to access
exchanges and market centers on the Exchange's network. In all cases,
BATS Connect subscribers would continue to be liable for the necessary
fees charged by that exchange or market center, including any required
connectivity fees. Market participants who chose a method other than
BATS Connect to connect to another exchange or market center would also
pay any required connectivity fees directly to that exchange or market
center. Likewise, BATS Connect subscribers would be liable for any
connectivity fees charged by the Exchange's affiliate.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the requirements of the Act and the rules and regulations
thereunder that are applicable to a national securities exchange, and,
in particular, with the requirements of Section 6 of the Act.\18\
Specifically, the Exchange believes that the proposed rule change is
consistent with Section 6(b)(4) of the Act,\19\ in that it provides for
the equitable allocation of reasonable dues, fees and other charges
among members and other persons using any facility or system which the
Exchange operates or controls.
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    \18\ 15 U.S.C. 78f.
    \19\ 15 U.S.C. 78f(b)(4).
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Standard Rates and Routing Rates
    The Exchange believes its proposed standard rates as well as rates
for routed orders are equitable and reasonable. The Exchange will
operate in a highly competitive market in which market participants may
readily send order flow to any of twelve competing venues if they deem
fees at the Exchange to be excessive. Initially, the Exchange does not
propose to implement a tiered pricing structure under which it would
provide enhanced rebates or reduced fees based on the Member's monthly
trading activity. Nor does the Exchange propose to implement ``maker-
taker'' pricing. As a new options exchange, the proposed fee structure
is intended to attract order flow to the Exchange by offering market
participants a competitive and simplified pricing structure.
    The Exchange believes it is equitable, reasonable and non-
discriminatory to implement a fee structure under which standard rates
are applied, the amount of which depend on whether the order is for a
Customer, Non-Customer, or Market Maker as well as the capacity of the
order with which such order trades. The Exchange believes that
application of a simple pricing structure that groups participants
together is advantageous to all Members of EDGX Options.
    The Exchange believes it is equitable, reasonable and non-
discriminatory to charge fees to Non-Customers (including Market
Makers) and provide a rebate to Customers when their orders execute
against each other. Non-Customer accounts generally engage in increased
trading activity as compared to Customer accounts. This level of
trading activity draws on a greater amount of Exchange system resources
than that of Customers. Simply, the more orders submitted to the
Exchange, the more messages sent to and received from the Exchange, and
the more Exchange system resources utilized. This level of trading
activity by Non-Customer accounts results in greater ongoing
operational costs to the Exchange.\20\ As such, the Exchange aims to
recover its costs by fees to Non-Customers when they execute against a
Customer order. Sending orders to and trading on the Exchange are
entirely voluntary. Under these circumstances, Exchange transaction
fees must be competitive to attract order flow, execute orders, and
grow its market. Other options

exchanges also provide for varying rates based on the capacity of the
order.\21\ As such, the Exchange believes its proposed trading fees are
fair and reasonable.
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    \20\ The Exchange, however, does not propose to assess ongoing
fess for EDGX Options market data or fees related to order
cancellation.
    \21\ See Nasdaq OMX PHLX LLC (``PHLX'') fee schedule available
at http://nasdaqtrader.com/Micro.aspx?id=PHLXPricing (charging no
fee to customer orders and variable rates non-customer orders). See
also Nasdaq OMX BX, Inc. fee schedule available at http://nasdaqtrader.com/Micro.aspx?id=BXOptionsPricing.
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    While Non-Customer orders will be assessed transaction fees when
executing against Customer orders, as proposed, Non-Customer orders
will be charged no fee when executing against other Non-Customer
orders. The Exchange believes it is equitable, reasonable and not
unfairly discriminatory to charge no fee to a Non-Customer order that
interacts with another Non-Customer order. Providing the opportunity
for a Non-Customer, including a Market Maker, to be charged no fee in
such scenarios is designed to encourage Non-Customers to add liquidity
to the Exchange. In turn, increased liquidity attracts should help
attract Customer order flow, which is beneficial to all other market
participants on the Exchange that seek executions against those
Customer orders. As a new entrant into the options marketplace, the
Exchange believes such a pricing incentive for Non-Customers is a
reasonable means to attract order flow by offering market participants
a competitive pricing structure.
    The Exchange also believes it is equitable, reasonable and not
unfairly discriminatory to charge Market Makers lower fees than Non-
Customers who are not Market Makers when executing against a Customer
order. The proposed differentiation between Market Makers and other
market participants such as Non-Customers recognizes the differing
contributions made to the liquidity and trading environment on the
Exchange by these market participants. Market Makers, unlike other
market participants, have obligations to the market and regulatory
requirements,\22\ which normally do not apply to other market
participants. A Market Maker has the obligation to make continuous
markets, engage in course of dealings reasonably calculated to
contribute to the maintenance of a fair and orderly market, and not
make bids or offers or enter into transactions that are inconsistent
with such course of dealings. On the other hand, Non-Customers and non-
Market Makers, do not have such obligations on the Exchange.
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    \22\ See Exchange Rule 21.5, Obligations of Market Makers.
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    Moreover, the Exchange believes it is equitable, reasonable and not
unfairly discriminatory to charge no fee or provide a rebate to
Customer orders that interacts with another Customer order. The
securities markets generally, and the Exchange in particular, have
historically aimed to improve markets for investors and develop various
features within the market structure for Customer benefit. Like
charging no fee to Non-Customer orders that execute against other Non-
Customer orders described above, charging no fee or providing a rebate
to Customers is designed to encourage Customers to add liquidity to the
Exchange. In turn, increased liquidity is beneficial to all other
market participants on the Exchange that seek executions against those
Customer orders. As such, the Exchange believes the proposed Customer
transaction pricing is equitably allocated, reasonable and not unfairly
discriminatory.
    As explained above, the Exchange's proposal with respect to routing
rates is to approximate the cost of routing to other options exchanges,
including other applicable costs to the Exchange for routing. The
Exchange believes that a pricing model based on approximate Routing
Costs is a reasonable, fair and equitable approach to pricing.
Specifically, the Exchange believes that its proposal to modify fees is
fair, equitable and reasonable because the proposed fees are generally
an approximation of the cost to the Exchange for routing orders to such
exchanges. As a general matter, the Exchange believes that the proposed
fees will allow it to recoup and cover its costs of providing routing
services to such exchanges. The Exchange notes that routing through the
Exchange is voluntary. The Exchange also believes that the proposed fee
structure for orders routed to and executed at these away options
exchanges is fair and equitable and not unreasonably discriminatory in
that it applies equally to all Members.
    The Exchange reiterates that it operates in a highly competitive
market in which market participants can readily direct order flow to
competing venues if they deem fee levels to be excessive or providers
of routing services if they deem fee levels to be excessive. Finally,
the Exchange notes that it will continually evaluate its routing fees,
including profit and loss attributable to routing, as applicable, and
would consider future adjustments to the proposed pricing structure to
the extent it was recouping a significant profit or loss from routing
to away options exchanges.
Marketing Fees
    The Exchange notes that the U.S. options markets are highly
competitive, and the marketing fee is intended to provide an incentive
for Market Makers to enter into marketing agreements with Members so
that they will provide order flow to the Exchange. The marketing fee is
charged only in a Market Maker's assigned classes because it is in
these classes that the Market Maker has the general obligation to
attract order flow to the Exchange. The Exchange believes that its
program of marketing fees, which is similar to marketing fee programs
that have previously been implemented on other options exchanges,\23\
will enhance the Exchange's competitive position and will result in
increased liquidity on the Exchange, thereby providing more of an
opportunity for customers to receive best executions. The Exchange
believes that its marketing fee is reasonable since the amount of the
Exchange's marketing fee is the same as other exchanges for Penny Pilot
Securities and less than or equal to other exchanges for Non-Penny
Pilot Securities.
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    \23\ See e.g., Securities Exchange Act Release Nos. 98415
(December 12, 2012), 77 FR 74905 (December 18, 2012) (SR-MIAX-2012-
01); 53969 (June 9, 2006), 71 FR 34973 (June 16, 2006) (SR-CBOE-
2006-53); 55265 (February 9, 2007), 72 FR 7697 (February 16, 2007)
(SR-CBOE-2007-11); 55271 (February 12, 2007), 72 FR 7699 (February
16, 2007) (SR-ISE-2007-08); and 54152 (July 14, 2006), 71 FR 41488
(July 21, 2006). See also, Securities Exchange Act Release Nos.
53841 (May 19, 2006), 71 FR 30461 (May 26, 2006) (SR-Phlx-2006-33);
54297 (August 9, 2006), 71 FR 47280 (August 16, 2006) (SR-Phlx-2006-
47); 54485 (September 22, 2006), 71 FR 57017 (September 28, 2006)
(SR-Phlx-2006-56); 55290 (February 13, 2007), 72 FR 8051 (February
22, 2007) (SR-Phlx-2007-05); and 55473 (March 14, 2007), 72 FR 13338
(March 21, 2007) (SR-Phlx-2007-12).
---------------------------------------------------------------------------

Port Fees
    The Exchange believes that the proposed logical port and physical
connection fees further the objectives of Section 6(b)(4),\24\ as it is
designed to provide for the equitable allocation of reasonable dues,
fees and other charges among its Members and other persons using its
facilities. The Exchange believes that the proposal represents an
equitable allocation of reasonable dues, fees, and other charges as its
fees for physical connectivity are reasonably constrained by
competitive alternatives. If a particular exchange charges excessive
fees for connectivity, affected Members and non-Members may opt to
terminate their connectivity arrangements with that exchange, and

adopt a possible range of alternative strategies, including routing to
the applicable exchange through another participant or market center or
taking that exchange's data indirectly. Accordingly, if the Exchange
charges excessive fees, it would stand to lose not only connectivity
revenues but also revenues associated with the execution of orders
routed to it, and, to the extent applicable, market data revenues. The
Exchange believes that this competitive dynamic imposes powerful
restraints on the ability of any exchange to charge unreasonable fees
for connectivity. The Exchange believes that the proposed fees are
reasonable in that they are identical to those included on the
Exchange's equities fee schedule and those of its affiliates.\25\
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78f(b)(4).
    \25\ See fee schedules for EDGX Equities, BZX, BZX Options,
EDGA, and BYX (charging fees for 1 gigabyte circuit of $2,000 per
month and for 10 gigabyte circuit of $4,000 per month).
---------------------------------------------------------------------------

    Finally, the Exchange believes that the proposed rates are
equitable and non-discriminatory in that they apply uniformly to all
Members and non-Members. Members and non-Members will continue to
choose whether they want more than one physical port and choose the
method of connectivity based on their specific needs. All Exchange
Members that voluntarily select various service options will be charged
the same amount for the same services. As is true of all physical
connectivity, all Members and non-Members have the option to select any
connectivity option, and there is no differentiation with regard to the
fees charged for the service.
Market Data Definitions and Products
    The Exchange believes that the proposed definitions are reasonable
because they are designed to provide greater transparency to Members
and non-Members with regard to how the Exchange provides for market
data. The Exchange believes that Members would benefit from clear
guidance in its fee schedule that describes the manner in which the
Exchange may assess fees if such fees are proposed in the future. These
definitions are intended to make the fee schedule clearer and less
confusing for Members and non-Members and eliminate potential
confusion, thereby removing impediments to and perfecting the mechanism
of a free and open market and a national market system, and, in
general, protecting investors and the public interest. Lastly, the
proposed definitions are identical to those included in the Exchange's
equities fee schedule and those of its affiliates.\26\
---------------------------------------------------------------------------

    \26\ See fee schedules for EDGX Equities, BZX, BZX Options,
EDGA, and BYX.
---------------------------------------------------------------------------

    The Exchange believes that its proposal to provide its Multicast
PITCH feed free of charge is consistent with Section 6(b)(4) of the Act
\27\ because it provides for an equitable allocation of reasonable
dues, fees, and other charges among its members and other recipients of
Exchange data. The Exchange also believes the proposal to provide
Multicast PITCH free of charge is reasonable and equitable in light of
the Exchange being a new entrant into the options exchange space and
would enable the Exchange to attract additional order flow. Lastly, the
Exchange also believes that the proposed amendments to its fee schedule
are reasonable and non-discriminatory because it will apply uniformly
to all Members.
---------------------------------------------------------------------------

    \27\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

BATS Connect
    The Exchange also believes that its proposal is consistent with
Section 6(b)(4) of the Act,\28\ in that it provides for the equitable
allocation of reasonable dues, fees and other charges among members and
other persons using its facilities. The Exchange notes that its fees
proposed for BATS Connect are identical to those currently charged by
its affiliates, all of which have been published for comment by the
Commission.\29\
---------------------------------------------------------------------------

    \28\ 15 U.S.C. 78f(b)(4).
    \29\ See fee schedules for EDGX Equities, BZX, BZX Options,
EDGA, and BYX (charging identical fees to those proposed herein for
the BATS Connect service).
---------------------------------------------------------------------------

    First, the Exchange will charge a connectivity fee to subscribers
utilizing BATS Connect to route orders to other exchanges and market
centers that are connected to the Exchange's network, which varies
based solely on the amount of bandwidth selected by the subscriber.
Second, with regard to utilizing BATS Connect to receive market data
products from other exchanges, the Exchange would only charge
subscribers a connectivity fee, the amount of which is based solely on
the amount of bandwidth required to transmit that specific data product
to the subscribers.
    The Exchange believes it is reasonable to offer such discounted
pricing to subscribers who purchase connectivity to a bundle of market
data products as it would enable them to reduce their overall
connectivity costs for the receipt of market data. As stated above,
BATS Connect is offered and purchased on a voluntary basis and
subscribers can discontinue use at any time and for any reason,
including due to an assessment of the reasonableness of fees charged.
Moreover, the Exchange believes the proposed fees are reasonable and
equitable because they continue to be based on the Exchange's costs to
cover the amount of bandwidth required to provide connectivity to the
select bundle of data feeds. The proposed fees will continue to allow
the Exchange to recoup this cost, while providing subscribers with an
alternative means to connect to the select bundle of data feeds at a
discounted rate.
    The subscribers would pay any fees: (i) Charged by the exchange
providing the market data feed directly to that exchange (ii) charged
by a market center to which they routed an order and an execution
occurred directly to that market center. The Exchange itself would not
charge any additional fees.\30\ BATS Connect is offered and purchased
on a voluntary basis, in that neither the Exchange nor subscribers are
required by any rule or regulation to make this product available.
Accordingly, subscribers can discontinue use at any time and for any
reason, including due to an assessment of the reasonableness of fees
charged.
---------------------------------------------------------------------------

    \30\ The Exchange's rules and fees would not address the fees or
manner of operation of any destination to which the subscriber asked
that an order be routed.
---------------------------------------------------------------------------

    Moreover, the Exchange believes the proposed fees are reasonable
and equitable because they are based on the Exchange's costs to cover
hardware, installation, testing and connection, as well as expenses
involved in maintaining and managing the service. The proposed fees
allow the Exchange to recoup these costs, while providing subscribers
with an alternative means to connect to other exchange and market
centers. The Exchange believes that the proposed fees are reasonable
and equitable in that they reflect the costs and the benefit of
providing alternative connectivity.
    The Exchange also believes it is equitable and reasonable to
provide BATS Connect to subscribers for no charge to route orders to or
receive market data products from the Exchange's affiliates. BATS
Connect provides subscribers a means to access exchanges and market
centers on the Exchange's network. In all cases, BATS Connect
subscribers would continue to be liable for the necessary fees charged
by the Exchange, its affiliate, or another exchange or market center,
including any required connectivity fees. As stated above, BATS Connect
is offered and purchased on a voluntary basis, and

subscribers and market participants may choose an alternative method to
connect to the Exchange, its affiliates, or another exchange or market
center connected to the Exchange's network. Such other services may
also offer at no charge connectivity to certain exchanges or a group of
exchanges.\31\ Therefore, the Exchange believes that providing BATS
Connect to subscribers at no charge to route orders to or receive
market data products from the Exchange's affiliates is reasonable and
equitable as they will continue to be liable to the Exchange or its
affiliate for any required connectivity fees.
---------------------------------------------------------------------------

    \31\ See NYSE's SFTI Americas Product and Service List available
at http://www.nyxdata.com/docs/connectivity (offering at no charge
connectivity to the NYSE, NYSE MKT LLC, and NYSE Arca, Inc.).
---------------------------------------------------------------------------

    Lastly, the Exchange also believes that the proposed fees for BATS
Connect are non-discriminatory because they will apply uniformly to all
subscribers. All subscribers that voluntarily select various service
options will be charged the same amount for the same services. All
subscribers have the option to select any connectivity option, and
there is no differentiation among subscribers with regard to the fees
charged for the service. Further, the benefits of selecting such
services are the same for all subscribers, irrespective of whether
their servers are located in the same facility as the Exchange.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes its proposed amendments to its fee schedule
would not impose any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The Exchange
does not believe that the proposed change represents a significant
departure from previous pricing offered by the Exchange or pricing
offered by the Exchange's competitors. Additionally, Members may opt to
disfavor the Exchange's pricing if they believe that alternatives offer
them better value. Accordingly, the Exchange does not believe that the
proposed change will impair the ability of Members or competing venues
to maintain their competitive standing in the financial markets. The
Exchange believes that its proposed pass through rates for orders
routed to and executed on an away options exchange would increase
competition because they offer customers an alternative means to route
to those destinations.
    The Exchange believes that its program of marketing fees, which is
similar to marketing fee programs that have previously been implemented
on other options exchanges,\32\ will enhance the Exchange's competitive
position and will result in increased liquidity on the Exchange,
thereby providing more of an opportunity for customers to receive best
executions.
---------------------------------------------------------------------------

    \32\ See supra note 23.
---------------------------------------------------------------------------

    The Exchange believes that fees for connectivity are constrained by
the robust competition for order flow among exchanges and non-exchange
markets. Further, excessive fees for connectivity, would serve to
impair an exchange's ability to compete for order flow rather than
burdening competition. The Exchange also does not believe the proposed
rule change would impact intramarket competition as it would apply to
all Members and non-Members equally.
    Lastly, the Exchange does not believe the proposed fees for BATS
Connect will result in any burden on competition. The proposed rule
change is designed to provide subscribers with an alternative means to
access other market centers on the Exchange's network if they choose or
in the event of a market disruption where other alternative connection
methods become unavailable. BATS Connect is not the exclusive method to
connect to these market centers and subscribers may utilize alternative
methods to connect to the product if they believe the Exchange's
proposed pricing is unreasonable or otherwise. Therefore, the Exchange
does not believe the proposed rule change will have any effect on
competition.

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

    The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any written comments from members or other interested parties.

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \33\ and paragraph (f) of Rule 19b-4
thereunder.\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.
---------------------------------------------------------------------------

    \33\ 15 U.S.C. 78s(b)(3)(A).
    \34\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposal 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 No. SR-EDGX-2015-56 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-EDGX-2015-56. 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 such filing will also 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-EDGX-2015-56 and should be
submitted on or before December 14, 2015.

    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. 2015-29708 Filed 11-20-15; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 81, Number 16 (Tuesday, January 26, 2016)]
[Rules and Regulations]
[Pages 4165-4167]
[FR Doc No: 2016-01268]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2015-3585; Directorate Identifier 2015-NE-22-AD;
Amendment 39-18384; AD 2015-28-01]
RIN 2120-AA64

Airworthiness Directives; Engine Alliance Turbofan Engines

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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

SUMMARY: We are adopting a new airworthiness directive (AD) for certain
Engine Alliance (EA) GP7270 turbofan engines. This AD was prompted by
the manufacturer informing us that the inspection criteria and repair
procedures in the maintenance manual for aft bolt holes of the high-
pressure compressor (HPC) cone shaft on the affected engines is
incorrect. This AD requires inspection of the HPC cone shaft and repair
of affected parts, if needed. We are issuing this AD to prevent failure
of the HPC cone shaft, which could lead to uncontained engine failure
and damage to the airplane.

DATES: This AD is effective March 1, 2016.
    The Director of the Federal Register approved the incorporation by
reference of a certain publication listed in this AD as of March 1,
2016.

ADDRESSES: For service information identified in this AD, contact
Engine Alliance, 400 Main St., East Hartford, CT 06108, M/S 169-10,
phone:<PHONE_NUMBER>; email<EMAIL_ADDRESS>Internet:
sp.engineallianceportal.com. You may view this service information at
the FAA, Engine & Propeller Directorate, 1200 District Avenue,
Burlington, MA. For information on the availability of this material at
the FAA, call<PHONE_NUMBER>.

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-
3585; 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 AD, the regulatory evaluation, any comments received, and
other information. The address for the Docket Office (phone: 800-647-
5527) is Document Management Facility, U.S. Department of
Transportation, Docket Operations, M-30, West Building Ground Floor,
Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

FOR FURTHER INFORMATION CONTACT: Kyle Gustafson, Aerospace Engineer,
Engine & Propeller Directorate, FAA, 1200 District Avenue, Burlington,
MA 01803; phone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; email:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Discussion

    We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR
part 39 by adding an AD that would apply to certain EA GP7270 turbofan
engines. The NPRM published in the Federal Register on October 1, 2015
(80 FR 59081). The NPRM was prompted by the manufacturer informing us
that the inspection criteria and repair procedures in the maintenance
manual for aft bolt holes of the HPC cone shaft, also referred to as
the ``HPC forward stubshaft,'' for the affected engines is incorrect.
The NPRM proposed to require inspection of the HPC cone shaft and
repair of affected parts, if needed. We are issuing this AD to prevent
failure of the HPC cone shaft, which could lead to uncontained engine
failure and damage to the airplane.

Comments

    We gave the public the opportunity to participate in developing
this AD. The following presents the comments received on the NPRM (80
FR 59081, October 1, 2015) and the FAA's response to each comment.

Request To Add Engine Models

    EA requested that we expand the applicability to include the GP7272
and GP7277 engine models.
    We disagree. There are no GP7272 or GP7277 engines in service nor
have any been delivered. New engines would be delivered with corrected
service

information and would not be impacted by this AD. We did not change
this AD.

Request To Change the Unsafe Condition Statement

    EA requested that the unsafe condition statement be changed from
``We are issuing this AD to prevent failure of the HPC cone shaft,
which could lead to uncontained engine failure and damage to the
airplane.'' to ``We are issuing this AD to prevent a hazardous engine
condition.'' The reason for this request is that no HPC cone shaft
failures have occurred in the field.
    We disagree. The unsafe condition statement describes the condition
we are trying to prevent and is the justification for this AD. It does
not describe what has occurred in the past. We did not change this AD.

Request To Change Various Paragraphs

    EA requested that we revise the part nomenclature in the
Applicability, Compliance, and Installation Prohibition paragraphs and
in the unsafe condition statement to include both ``cone shaft'' and
``forward stubshaft.'' The part is referenced as a ``cone shaft'' in
this AD and engine and component manuals; however, it is referred to as
a ``forward stubshaft'' in the service bulletins (SBs).
    We disagree. The part nomenclature listed in the airworthiness
limitations section and engine maintenance manual is ``cone shaft.''
The Discussion section of this AD explains that the terms ``cone
shaft'' and ``forward stubshaft'' are synonymous. We consider including
both terms throughout this AD unnecessary. We did not change this AD.

Request To Revise the Compliance

    EA requested that the Compliance paragraph be revised to include
the word ``pits'' when describing the inspection criteria.
    We agree. We revised paragraph (e)(1) and (f)(1) of this AD from
``. . . nicks, dents, and scratches . . .'' to ``. . . nicks, dents,
pits, and scratches. . . .''

Request To Change the Compliance

    EA requested that we replace ``Do not reinstall the HPC cone shaft
if the aft bolt hole has a nick, dent, or scratch that is greater than
0.002 inch in depth'' in paragraph (e)(1) of this AD with ``Comply with
the Accomplishment Instructions in EA SB No. EAGP7-72-330 if the aft
bolt hole has a nick, dent, pit, or scratch that is greater than the
serviceable limit.''
    We disagree. The current engine manual has an approved repair
procedure for damage that is more severe than the installation
requirements of this AD. It is not necessary to restate what is already
allowed by the engine manual. We did not change this AD.

Request To Change Service Information

    EA requested that the phrase ``or later'' be used when referring to
SBs.
    We disagree. We are only authorized to mandate use of SBs that we
have reviewed and which are published. Since future revisions of SBs
are not yet published, we are not authorized to mandate their use. We
did not change this AD.

Request To Change the Installation Prohibition

    EA requested that we change the Installation Prohibition paragraph
to read: ``After the effective date of this AD, do not install an HPC
cone shaft onto an engine: (1) that has accumulated more than 9,000
cycles since new that has not complied with this AD on an applicable
part, and (2) has a nick, dent, or scratch in an HPC cone shaft aft
bolt hole that is greater than the serviceable limit.''
    We disagree. The intent of the Installation Prohibition paragraph
is to mandate the new serviceable limit of 0.002 inch for damage to the
inner diameter of the bolt holes for the entire GP7270 fleet. Any parts
with damage beyond this limit may be repaired using the approved
procedures listed in the engine manual, provided that you include shot
peening as required by paragraph (f)(2) of this AD. We did not change
this AD.

Conclusion

    We reviewed the relevant data, considered the comments received,
and determined that air safety and the public interest require adopting
this AD with the changes described previously.
    We also determined that these changes will not increase the
economic burden on any operator or increase the scope of this AD.

Related Service Information Under 1 CFR Part 51

    EA has issued SB No. EAGP7-72-329, dated July 21, 2015 and SB No.
EAGP7-72-330, dated July 21, 2015. The service information describes
procedures for shotpeening the HPC forward stubshaft and inspecting the
HPC forward stubshaft bolt-hole inner diameter respectively. 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 final rule.

Costs of Compliance

    We estimate that this AD affects zero engines installed on
airplanes of U.S. registry. The average labor rate is $85 per hour.
Based on these figures, we estimate the cost of this AD on U.S.
operators to be $0.

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

    This AD will not have federalism implications under Executive Order
13132. This AD will not have a substantial direct effect on the States,
on the relationship between the national government and the States, or
on the distribution of power and responsibilities among the various
levels of government.
    For the reasons discussed above, I certify that this AD:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866,
    (2) Is not a ``significant rule'' under DOT Regulatory Policies and
Procedures (44 FR 11034, February 26, 1979),
    (3) Will not affect intrastate aviation in Alaska to the extent
that it justifies making a regulatory distinction, 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.

Adoption of the Amendment

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

PART 39--AIRWORTHINESS DIRECTIVES

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

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

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by adding the following new airworthiness
directive (AD):

2015-28-01 Engine Alliance: Amendment 39-18384; Docket No. FAA-2015-
3585; Directorate Identifier 2015-NE-22-AD.

(a) Effective Date

    This AD is effective March 1, 2016.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to Engine Alliance (EA) GP7270 turbofan engines
with a high-pressure compressor (HPC) cone shaft, part number 382-
100-907-0, installed.

(d) Unsafe Condition

    This AD was prompted by the manufacturer informing us that the
inspection and repair criteria in the maintenance manual for aft
bolt holes of the HPC cone shaft on the affected engines is
incorrect. We are issuing this AD to prevent failure of the HPC cone
shaft, which could lead to uncontained engine failure and damage to
the airplane.

(e) Compliance

    Comply with this AD within the compliance times specified,
unless already done.
    (1) For HPC cone shafts with serial numbers listed in EA Service
Bulletin (SB) No. EAGP7-72-330, dated July 21, 2015, inspect the
inner diameter of the HPC cone shaft aft bolt holes for nicks,
dents, pits, and scratches before accumulating 9,000 cycles since
new (CSN). Do not reinstall the HPC cone shaft if the aft bolt hole
has any nicks, dents, pits, or scratches that are greater than 0.002
inch in depth.
    (2) For HPC cone shafts with serial numbers listed in EA SB No.
EAGP7-72-329, dated July 21, 2015, shot peen the HPC cone shaft aft
bolt holes before accumulating 9,000 CSN. Use paragraph 1 of the
Accomplishment Instructions in EA SB No. EAGP7-72-329 to do the shot
peening.

(f) Installation Prohibition

    After the effective date of this AD, do not install an HPC cone
shaft on any engine with the following:
    (1) any nicks, dents, pits, or scratches in an HPC cone shaft
aft bolt hole that is greater than 0.002 inch in depth; or
    (2) any repair of an HPC cone shaft aft bolt hole that did not
include shot peening.

(g) Alternative Methods of Compliance (AMOCs)

    The Manager, Engine Certification Office, may approve AMOCs for
this AD. Use the procedures found in 14 CFR 39.19 to make your
request. You may email your request to<EMAIL_ADDRESS>
(h) Related Information

    For more information about this AD, contact Kyle Gustafson,
Aerospace Engineer, Engine & Propeller Directorate, FAA, 1200
District Avenue, Burlington, MA 01803; phone:<PHONE_NUMBER>; fax:
781-238-7199; email<EMAIL_ADDRESS>
(i) Material Incorporated by Reference

    (1) The Director of the Federal Register approved the
incorporation by reference (IBR) of the service information listed
in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
    (2) You must use this service information as applicable to do
the actions required by this AD, unless the AD specifies otherwise.
    (i) Engine Alliance (EA) Service Bulletin (SB) No. EAGP7-72-329,
dated July 21, 2015.
    (ii) EA SB No. EAGP7-72-330, dated July 21, 2015.
    (3) For EA service information identified in this AD, contact
Engine Alliance, 400 Main St., East Hartford, CT 06108, M/S 169-10;
phone:<PHONE_NUMBER>; email<EMAIL_ADDRESS>Internet:
sp.engineallianceportal.com.
    (4) You may view this service information at FAA, Engine &
Propeller Directorate, 1200 District Avenue, Burlington, MA. For
information on the availability of this material at the FAA, call
781-238-7125.
    (5) You may view this service information at the National
Archives and Records Administration (NARA). For information on the
availability of this material at NARA, call<PHONE_NUMBER>, or go to:
http://www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued in Burlington, Massachusetts, on January 13, 2016.
Gaetano Sciortino,
Acting Directorate Manager, Engine & Propeller Directorate, Aircraft
Certification Service.
[FR Doc. 2016-01268 Filed 1-25-16; 8:45 am]
 BILLING CODE 4910-13-P


[Federal Register: March 25, 2009 (Volume 74, Number 56)]
[Notices]
[Page 12925-12929]
[DOCID:fr25mr09-198]

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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-2008-0107, Notice 2]

Spyker Automobielen B.V.; Grant of Application for Limited
Extension of Temporary Exemption From Certain Requirements of FMVSS No.
208

AGENCY: National Highway Traffic Safety Administration (NHTSA),
Department of Transportation (DOT).

ACTION: Grant of petition for limited extension of a Temporary
Exemption from certain provisions of Federal Motor Vehicle Safety
Standard (FMVSS) No. 208, Occupant Crash Protection.

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

SUMMARY: This notice grants the Spyker Automobielen B.V. (``Spyker'')
application for a limited extension of a previously received temporary
exemption from certain requirements of Federal Motor Vehicle Safety
Standard (FMVSS) No. 208, Occupant Crash Protection, for the Spyker C
vehicle line. In accordance with 49 CFR Part 555, the basis for the
grant is that compliance would cause substantial economic hardship to a
low-volume manufacturer that has tried in good faith to comply with the
standard, and the exemption would have a negligible impact on motor
vehicle safety. The exemption is effective through December 15, 2010.
    In accordance with the requirements of 49 U.S.C. 30113(b)(2), we
published a notice of receipt of the application and asked for public
comments.\1\
---------------------------------------------------------------------------

    \1\ To view the application or public comments, please go to:
http://www.regulations.gov (Docket No. NHTSA-2007-0107).

DATES: The exemption from the applicable Federal motor vehicle safety
---------------------------------------------------------------------------
standards is effective from March 25, 2009 through December 15, 2010.

FOR FURTHER INFORMATION CONTACT: Sarah Alves, Office of the Chief
Counsel, NCC-112, National Highway Traffic Safety Administration, 1200
New Jersey Avenue, SE., Washington, DC 20590. Phone:<PHONE_NUMBER>; Fax:
202-366-3820; e-Mail<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Advanced Air Bag Requirements and Small

Volume Manufacturers
II. Overview and Statutory Background of Petition for Economic
Hardship Exemption
III. Petition of Spyker
IV. Federal Register Notice of May 27, 2008
V. NHTSA Analysis of Petition
VI. Agency Decision

I. Advanced Air Bag Requirements and Small Volume Manufacturers

    In 2000, NHTSA upgraded the requirements for air bags in passenger
cars and light trucks, requiring what are commonly known as ``advanced
air bags.'' \2\ The upgrade was designed to meet the goals of improving
protection for occupants of all sizes, belted and unbelted, in
moderate-to-high-speed crashes, and of minimizing the risks posed by
air bags to infants, children, and other occupants, especially in low-
speed crashes.
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    \2\ See 65 FR 30680 (May 12, 2000).
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    The advanced air bag requirements were a culmination of a
comprehensive plan that the agency announced in 1996 to address the
adverse effects of air bags. This plan also included an extensive
consumer education program to encourage the placement of children in
rear seats. The new requirements were phased in beginning with the 2004
model year.
    Small volume manufacturers were not subject to the advanced air bag
requirements until September 1, 2006, but their efforts to bring their
respective vehicles into compliance with these requirements began
several years earlier. However, because the new requirements were
challenging, major air bag suppliers concentrated their efforts on
working with large volume manufacturers, and thus, until recently,
small volume manufacturers had limited access to advanced air bag
technology. Because of the nature of the requirements for protecting
out-of-position occupants, ``off-the-shelf'' systems could not be
readily adopted. Further complicating matters, because small volume
manufacturers build so few vehicles, the costs of developing custom air
bag systems compared to potential benefits discouraged some air bag
suppliers from working with small volume manufacturers.
    The agency has carefully tracked occupant fatalities resulting from
air bag deployment. Our data indicate that the agency's efforts in the
area of consumer education and manufacturers' providing depowered air
bags were successful in reducing air bag fatalities even before
advanced air bag requirements were implemented. As always, we are
concerned about the potential safety implication of any temporary
exemptions granted by this agency.
    In a petition submitted on August 17, 2007,\3\ Spyker Automobielen
B.V. (``Spyker'') requested a limited extension of the temporary
exemption that it previously received,\4\ i.e., a three-year hardship
exemption from the ``basic'' air bag requirements and advanced air bag
provisions of FMVSS No. 208, Occupant Crash Protection, as well as from
49 CFR Part 581, Bumper Standard. The requested exemption would apply
to the Spyker C vehicle line and would apply to certain advanced air
bag requirements, specifically the requirements in S19, S21, S23, and
S25 (the child and 5th percentile adult female driver out-of-position
portions of the advanced air bag provisions of FMVSS No. 208). Spyker
requested an extension for exemption from these requirements through
December 15, 2010.
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    \3\ The petition is available at http://www.regulations.gov,
Docket No. NHTSA-2007-0107.
    \4\ The original petition of Spyker is available at http://
www.regulations.gov, Docket No. NHTSA-2005-20455. The notice
granting that petition, Spyker Automobielen B.V.; Grant of
Application for a Temporary Exemption From Federal Motor Vehicle
Safety Standards Nos. 201 and 208; and Part 581 Bumper Standard, was
published at 70 FR 39007, July 6, 2005.
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II. Overview and Statutory Background of Petition for Economic Hardship
Exemption

    In accordance with 49 U.S.C. 30113 and the procedures in 49 CFR
Part 555, Spyker has petitioned the agency for a limited extension of a
temporary exemption from certain requirements of FMVSS No. 208. The
basis for the application was that compliance would cause substantial
economic hardship to a manufacturer that has tried in good faith to
comply with the standard. A manufacturer is eligible to apply for a
hardship exemption if its total motor vehicle production in its most
recent year of production did not exceed 10,000 vehicles, as determined
by the NHTSA Administrator (49 U.S.C. 30113).
    In determining whether a manufacturer of a vehicle meets that
criterion, NHTSA considers whether a second vehicle manufacturer also
might be deemed the manufacturer of that vehicle. The statutory
provisions governing motor vehicle safety (49 U.S.C. Chapter 301) do
not include any provision indicating that a manufacturer might have
substantial responsibility as manufacturer of a vehicle simply because
it owns or controls a second manufacturer that assembled that vehicle.
However, the agency considers the statutory definition of
``manufacturer'' (49 U.S.C. 30102(a)(5)) to be sufficiently broad to
include sponsors, depending on the circumstances. Thus, NHTSA has
stated that a manufacturer may be deemed to be a sponsor and thus a
manufacturer of a vehicle assembled by a second manufacturer if the
first manufacturer had a substantial role in the development and
manufacturing process of that vehicle.
    Finally, while 49 U.S.C. 30113(b) states that exemptions from a
Safety Act standard are to be granted on a ``temporary basis,'' the
statute also expressly provides for renewal of an exemption on
reapplication.\5\ Manufacturers are nevertheless cautioned that the
agency's decision to grant an initial petition in no way predetermines
that the agency will repeatedly grant renewal petitions, thereby
imparting semi-permanent exemption from a safety standard. Exempted
manufacturers seeking renewal must bear in mind that the agency is
directed to consider financial hardship as but one factor, along with
the manufacturer's on-going good faith efforts to comply with the
regulation, the public interest, consistency with the Safety Act,
generally, as well as other such matters provided in the statute.
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    \5\ 49 U.S.C. 30113(b)(1).
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III. Petition of Spyker

    Background. NHTSA notes that a manufacturer is eligible to apply
for a hardship exemption if its total motor vehicle production in its
most recent year of production does not exceed 10,000, as determined by
the NHTSA Administrator (49 U.S.C. 30113(d)). In its petition, Spyker
stated that it manufactured 94 automobiles in 2006 and estimated a
total production of 106 automobiles in 2007. Spyker stated that 60
automobiles were imported into the U.S. in 2006, and Spyker projected
that U.S. imports would total 70 Spyker automobiles in 2007.
Subsequently, Spyker advised NHTSA that it manufactured 22 automobiles
in 2007 and 43 in 2008. Seven Spyker automobiles were imported into the
U.S. in 2007 and 6 were imported in 2008.
    Spyker is a wholly owned subsidiary of Spyker Cars NV, a publicly
traded Dutch company. Spyker stated that it is unaware of any other
automobile manufacturer having an ownership interest in Spyker.\6\
Moreover, Spyker stated that Spyker Cars NV has no ownership interest
in any other vehicle

manufacturer, and is not under any common control with another
automobile manufacturer.
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    \6\ Only parties with an interest of more than 5% are known and
need to register with the Dutch authority for financial markets.
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    In July 2005, NHTSA granted Spyker a three-year hardship exemption
from the ``basic'' air bag requirements and advanced air bag provisions
of FMVSS No. 208 (S<IP_ADDRESS>; S14), and Part 581, expiring on June 15,
2008 (70 FR 39007; July 6, 2005). In this same grant, NHTSA also
exempted Spyker from S7 of FMVSS No. 108, Lamps, Reflective Devices,
and Associated Equipment, for the first 10 Spyker C8 vehicles imported
into the United States.
    Requested exemption. Spyker is requesting a limited extension of
that temporary exemption. Spyker is requesting an exemption from the
child and 5th percentile adult female driver out-of-position portions
of the advanced air bag provisions of FMVSS No. 208 (S19, S21, S23, and
S25).\7\ Spyker's previous exemption extended until June 15, 2008,\8\
and Spyker requested a two-and-a-half year extension that would exempt
Spyker's C8 vehicle line from the listed advanced air bag requirements
through December 15, 2010. Spyker submitted a supplement to their
petition on April 7, 2008, which is posted in this docket, and which
included updated financial information from 2007. See Docket No. NHTSA-
2008-0107-0003.
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    \7\ The previous exemption covered these provisions by including
S14.
    \8\ We note that under 49 CFR 555.8(e), ``if an application for
renewal of temporary exemption that meets the requirements of Sec.
555.5 has been filed not later than 60 days before the termination
date of an exemption, the exemption does not terminate until the
Administrator grants or denies the application for renewal.''
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    Economic hardship. Spyker stated that its previously established
financial hardship \9\ continues, in part due to the start-up nature of
the company. Specifically, Spyker's financial information submission
showed a net operating loss of 13,000,000 Euros ($16,900,000) from 2004
to 2006.\10\ Spyker originally projected a further loss in 2007 of
6,500,000 Euros ($8,450,000). Moreover, based on 2008-2010 projections,
Spyker estimated that if the limited extension is denied, Spyker will
bear a loss of over 2,000,000 Euros ($2,600,000) during that time.
Spyker also stated that the loss of sales in the U.S. that would result
if the limited extension is denied could not be made up in the rest of
the world because the U.S. is the largest and most important market for
the vehicle. Spyker argued that such consequences demonstrate
``substantial economic hardship'' within the meaning of 49 U.S.C.
30113(b)(3)(B)(i).
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    \9\ See 70 FR 39007 (July 6, 2005).
    \10\ All dollar values are based on an exchange rate of 1 Euro =
$1.30.
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    On April 7, 2008, Spyker submitted to NHTSA a supplement to their
petition because Spyker had recently updated its accounts for 2007.\11\
Spyker stated in its supplement to its petition that 2007 losses now
total 16,000,000 Euros ($20,800,000), and stated that this higher
number was due to their parent company having sold its interest in its
Formula 1 (``F1'') racing team, and extraordinary financing and
consulting costs. This new financial statement information is in
further support of the substantial economic hardship criterion.
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    \11\ See Supplement to Petition of Spyker Cars for Limited
Extension of Temporary Exemption (April 7, 2008), Docket No. NHTSA-
2008-0107-0003.
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    Good faith efforts to comply. Spyker stated that when it filed for
the original exemption, the C vehicle line had no air bag system at
all, and that the windshield design does not permit a top-mounted air
bag on the passenger side, thereby precluding the use of a low risk
deployment system. Spyker indicated that it has spent over 3,500,000
Euros bringing the C vehicle line into compliance with all of the high-
speed belted and unbelted crash test requirements of the Advanced Air
Bag rule by developing an ``interim'' driver air bag system for the C
vehicle line. However, it stated that it has not been able to bring the
vehicle into compliance with the child out-of-position requirements
(S19, S21, and S23), and the 5th percentile adult female out-of-
position requirements for the driver seat (S25). Despite efforts to
involve numerous potential suppliers, Spyker has not identified any
that are willing to work with the company to develop an automatic
suppression system for compliance with S19, S21, and S23. Spyker has
budgeted an additional 3,500,000 Euros for 2008-2010 to develop, test
and build a fully-compliant advanced air bag system for the new C line
vehicle. Spyker also indicated that by the time its new D vehicle line
is launched, Spyker will have spent 5,500,000 Euros developing for this
new line an advanced air bag system fully compliant with FMVSS No. 208.
    Spyker further indicated that it plans to re-engineer the C vehicle
line for model year 2011, at which time the D line advanced air bag
system will be incorporated into the new C line, making the redesigned
C line fully compliant with all advanced air bag requirements. Spyker
stated that it will use the extension period, if granted, to develop,
test, tool and implement the redesigned model.
    Spyker argues that an exemption would be in the public interest.
The petitioner put forth several arguments in favor of a finding that
the requested exemption is consistent with the public interest and
would not have a significant adverse impact on safety. Specifically:
    1. Spyker stated that the exempted vehicles will comply with all
FMVSSs other than the provisions that are the subject of this extension
request.
    2. The petitioner stated that an exemption will benefit U.S.
employment and U.S. companies because Spyker vehicles are distributed
by a U.S. company, Spyker of North America, and are sold and serviced
in the U.S. through a network of 17 dealers. Spyker argued that denial
of an extension will negatively impact these companies.
    3. Spyker argued that if the exemption is not granted, U.S.
consumer choice would be harmed and that the agency has long maintained
that the National Traffic and Motor Vehicle Safety Act seeks, if
possible, to avoid limiting consumer choice.
    4. The petitioner argued that given its exotic design and high-
performance nature, the C vehicle line is not expected to be used
extensively, nor is it expected to carry children with any frequency.
    5. Spyker stated that as of the submission date of its application
for extension, approximately 60 exempted C line Spykers have been
imported into the U.S. and there have been no reports of any air bag-
related injuries.
    6. Spyker stated that an important safety feature on the C line
offers enhanced occupant protection. The petitioner stated that
occupants are positioned in a protective ``cell'' because the main
chassis structure is built around them.

IV. Federal Register Notice of May 27, 2008

    In the Federal Register of May 27, 2008 (73 FR 30443), we published
a notice announcing receipt of an application from Spyker for a limited
extension of a previously received temporary exemption from the
advanced air bag requirements of FMVSS No. 208 for the Spyker C vehicle
line. We invited public comment on Spyker's application. We received
one comment in response to this publication from Spyker in support of
its petition. See Docket No. NHTSA-2008-0107-0004. The comment was
brief and provided an update on Spyker's air bag development work,
confirming that the driver air bag was incorporated into Spyker vehicle
production as of the start

of the second quarter of 2008. It stated that the passenger air bag
development has been proceeding with testing and would be incorporated
into all vehicle production prior to the expiration of the current
exemption.

V. NHTSA Analysis of Petition

    The following discussion provides our decision regarding Spyker's
temporary exemption request pertaining to the advanced air bag
requirement of FMVSS No. 208.
    In July 2005 Spyker was granted a temporary exemption from the
bumper standard and from the ``basic'' air bag requirements. Despite
significant expenditures of capital and labor in pursuit of
compliance,\12\ Spyker was unable to bring its Spyker C vehicle line
into compliance with all of the advanced air bag requirements
(although, we note, it was able to comply with sections S14.5, S15, and
S17 of Standard No. 208, as well as 49 CFR Part 581, Bumper Standard).
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    \12\ The precise figures are provided in the confidential
version of the petition.
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    Spyker stated that the U.S. sales losses that would occur as the
result of an exemption extension denial could not be made up in the
rest of the world because the U.S. is by far the largest market for
Spyker vehicles, representing approximately 70 percent of Spyker sales.
At the time of the petition, Spyker estimated that the difference
between granting and denying the extension would amount to 35,000,000
Euros ($45,500,000). Spyker stated that such consequences demonstrate
``substantial economic hardship'' within the meaning of 49 U.S.C.
30113(b)(3)(B)(i).
    Spyker has requested that additional specific details regarding its
finances and financial forecasts be afforded confidential treatment
under 49 CFR 512.4, asserting a claim for confidential information.
NHTSA has granted the request and determined that this information is
to be afforded confidential treatment.
    While it complies with a significant portion of the requirements of
FMVSS No. 208, the petitioner has not been able to achieve full
compliance despite considerable effort put forth to that end. When
Spyker applied for and was granted its original exemption, the C8
vehicle line had no air bag system at all because the original vehicle
was designed in 2000 without the U.S. market and air bags in mind.
Spyker indicated that it has spent over 3,500,000 Euros bringing the C
vehicle line into compliance with all of the high-speed belted and
unbelted crash test requirements of the advanced air bag requirements
by developing an ``interim'' driver air bag system for the C vehicle
line. However, it stated that it has not been able to bring the vehicle
into compliance with the child out-of-position requirements (S19, S21,
and S23), and the 5th percentile adult female out-of-position
requirements for the driver seat (S25). Despite recent efforts to
involve numerous potential suppliers, Spyker has not identified any
that are willing to work with the company to develop an automatic
suppression system for compliance with S19, S21, and S23. Spyker has
budgeted an additional 3,500,000 Euros for 2008-2010 to develop, test
and build a fully-compliant advanced air bag system for the new C line
vehicle. Spyker also indicated that by the time its new D vehicle line
is launched, Spyker will have spent 5,500,000 Euros developing for this
new line an advanced air bag system fully compliant with FMVSS No. 208.
Additionally, Spyker stated in its petition that it plans to re-
engineer the C line for MY 2011 (including new tooling), at which time
the D line advanced air bag system will be incorporated into the C
line, making the redesigned C line fully compliant with FMVSS No. 208.
Spyker explains that it would use the exemption extension period to
develop, test, tool, and implement the redesigned model.
    Given the above discussion, we conclude that Spyker has
demonstrated good faith effort to bring its vehicles into compliance
with the relevant advanced air bag requirements of FMVSS No. 208 and
has also demonstrated the requisite financial hardship.
    We believe there are public interest considerations served by
granting this petition. These include the general consideration of
affording consumers a wider variety of motor vehicle choices and the
economic benefits of affording continued employment to the Spyker's
U.S. work force and distribution network. Moreover, we believe this
exemption will have a minimal impact on safety given the limited number
of vehicles, the relatively low-use nature of the vehicle, and the rare
use of the vehicle by young children.
    After considering all of the relevant information, including
Spyker's commitment to meet the advanced air bag requirements for the
redesigned vehicle, we believe Spyker has presented a persuasive case
for extending, in a limited way, the current exemption until December
15, 2010. The agency notes that the vehicle subject to this petition
must comply with the other portions of FMVSS No. 208 and all other
applicable Federal motor vehicle safety standards.

VI. Agency Decision

    In consideration of the foregoing, we conclude that compliance with
the advanced air bag requirements of FMVSS No. 208, Occupant Crash
Protection, would cause substantial economic hardship to a small-volume
manufacturer that has tried in good faith to comply with the standard.
We further conclude that granting of an exemption would be in the
public interest and consistent with the objectives of traffic safety.
    We note that, as explained below, prospective purchasers will be
notified that the vehicle is exempted from the specified advanced air
bag requirements of FMVSS No. 208. Under 49 CFR Sec.  555.9(b), a
manufacturer of an exempted passenger car must affix securely to the
windshield or side window of each exempted vehicle a label containing a
statement that the vehicle conforms to all applicable Federal motor
vehicle safety standards in effect on the date of manufacture ``except
for Standards Nos. [listing the standards by number and title for which
an exemption has been granted] exempted pursuant to NHTSA Exemption
No.----------.'' This label notifies prospective purchasers about the
exemption and its subject. Under 49 CFR 555.9(c), this information must
also be included on the vehicle's certification label.
    We note that the text of 49 CFR 555.9 does not expressly indicate
how the required statement on the two labels should read in situations
where an exemption covers part but not all of a Federal motor vehicle
safety standard. Specifically in the case of FMVSS No. 208, we believe
that a statement that the vehicle has been exempted from FMVSS No. 208
generally, without an indication that the exemption is limited to the
specified advanced air bag provisions, could be misleading. A consumer
might incorrectly believe that the vehicle has been exempted from all
of FMVSS No. 208's requirements. Moreover, we believe that the addition
of a reference to such provisions by number without an indication of
its subject matter would be of little use to consumers, since they
would not know the subject of those specific provisions. For these
reasons, we believe the two labels should read in relevant part,
``except for S19, S21, S23, and S25 (Advanced Air Bag Requirements) of
Standard No. 208, Occupant Crash Protection, exempted pursuant to * *
*.'' We note that the phrase ``Advanced Air Bag

Requirements'' is an abbreviated form of the title of S14 of FMVSS No.
208.
    In accordance with 49 U.S.C. 30113(b)(3)(B)(i), Spyker is granted
NHTSA Temporary Exemption No. EX 08-03, from S19, S21, S23 and S25 of
FMVSS No. 208. The exemption shall remain in effect until December 15,
2010.
    (49 U.S.C. 30113; delegations of authority at 49 CFR 1.50. and
501.8)

    Issued on: March 19, 2009.
Ronald L. Medford,
Acting Deputy Administrator.
[FR Doc. E9-6576 Filed 3-24-09; 8:45 am]

BILLING CODE 4910-59-P


[Federal Register Volume 85, Number 61 (Monday, March 30, 2020)]
[Notices]
[Page 17576]
[FR Doc No: 2020-06556]

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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-ORD-2015-0365; FRL 10007-22-ORD]

Board of Scientific Counselors (BOSC) Air and Energy Subcommittee
Meeting--April 2020; Correction

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of public meeting; correction.

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SUMMARY: The Environmental Protection Agency (EPA), Office of Research
and Development (ORD), published a document in the Federal Register of
March 18, 2020, giving notice of a meeting of the Board of Scientific
Counselors (BOSC) Air and Energy (A-E) Subcommittee. In response to the
COVID-19 outbreak, this meeting will now be taking place via
videoconference. Due to unforeseen administrative circumstances, EPA is
announcing this meeting with less than 15 calendar days' notice.

FOR FURTHER INFORMATION CONTACT: Tom Tracy, Designated Federal Officer
(DFO), via phone/voice mail at:<PHONE_NUMBER>; via fax at: (202) 565-
2911; or via email at<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Correction

    In the Federal Register of March 18, 2020, in FR Doc. 2020-05579,
on page 15447, column 3 correct the Dates and Addresses captions to
read:

DATES: The videoconference meeting will be held on Wednesday, April 1,
2020, from 1:00 p.m. to 5:00 p.m. (EDT) and will continue on Thursday,
April 2, 2020, from 1:00 p.m. to 4:30 p.m. (EDT). Meeting times are
subject to change. This meeting is open to the public. Those who wish
to attend must register by March 30, 2020. Comments must be received by
March 25, 2020 to be considered by the subcommittee. Requests for the
draft agenda or making a presentation at the meeting will be accepted
until March 30, 2020.

ADDRESSES: Instructions on how to connect to the videoconference will
be provided upon registration at https://epa-bosc-a-e.eventbrite.com.
Attendees should register by March 30, 2020. Instructions on the
submission of comments remain unchanged.

    Dated: March 24, 2020.
Mary Ross,
Director, Office of Science Advisor, Policy, and Engagement.
[FR Doc. 2020-06556 Filed 3-27-20; 8:45 am]
 BILLING CODE 6560-50-P