NOTE

SUBJECT:	Summary of February 15, 2012, meeting with American Chemistry Council

TO:		EPA-HQ-OPPT-2011-0182 and EPA-HQ-OPPT-2011-0180

FROM:	Katherine Sleasman,<PHONE_NUMBER>

	 	The American Chemistry Council (ACC) hosted a meeting that included industry representatives from Bayer, BASF, Huntsman, Gorilla Glue, Dow, Fomo, Sika, Spray Polyurethane Foam Alliance (SPFA), and the Center for the Polyurethanes Industry (CPI) who met with EPA, the Consumer Product Safety Commission (CPSC), National Institute for Occupational Safety and Health (NIOSH), and Agency for Toxic Substances and Disease Registry (ATSDR). Industry representatives provided an overview of new information related to the 2011 Action Plans on methylene diphenyl diisocyanates (MDI) and related compounds and toluene diisocyanates (TDI) and related compounds. Presentation topics included product stewardship initiatives, raw material growth, medical surveillance advances, industrial hygiene practices for anticipated exposures, and a brief overview of the different uses of unreacted MDI and TDI in a variety of polyurethane products including coatings, sealants, and spray foam. EPA representatives were in a listening mode and all materials shared will be made available in the public docket. A copy of the ACC's presentation materials are attached to this note.   	 	The development of a Significant New Use Rule (SNUR) on TDI, the 8(c) notice, and 8(d) Health and Safety Rule were not discussed at this meeting.


[Federal Register Volume 76, Number 158 (Tuesday, August 16, 2011)]
[Notices]
[Pages 50784-50786]
[FR Doc No: 2011-20732]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-65080; File No. SR-CHX-2011-23]

Self-Regulatory Organizations; Chicago Stock Exchange, Inc.;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
To Extend the Pilot Program Relating to Individual Securities Circuit
Breakers

August 9, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given
that on August 8, 2011, the Chicago Stock Exchange, Inc. (``CHX'' or
the ``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the CHX. CHX has filed this
proposal pursuant to Exchange Act Rule 19b-4(f)(6) \3\ which is
effective upon filing with the Commission.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 17 CFR 240.19b-4(f)(6).

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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    CHX proposes to amend its rules to extend the pilot program
relating to individual securities circuit breakers. The text of this
proposed rule change is available on the Exchange's Web site at (http://www.chx.com) and in 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 CHX included statements
concerning the purpose of and basis for the proposed rule changes and
discussed any comments it received regarding the proposal. The text of
these statements may be examined at the places specified in Item IV
below. The CHX has prepared summaries, set forth in sections A, B and C
below, of the most significant aspects of such statements.

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

1. Purpose
    In June, 2010, CHX obtained Commission approval to amend Article
20, Rule 2 to create circuit breakers in individual securities on a
pilot basis to end on December 10, 2010.\4\ Shortly thereafter, in
September, the Commission approved another amendment to Article 20,
Rule 2 to add securities included in the Russell 1000[supreg] Index
(``Russell 1000'') and certain specified Exchange Traded Products
(``ETP'') to the pilot rule.\5\ This program was subsequently extended
until April 11, 2011 \6\ and was again extended until August 11,
2011.\7\ Then, in June, 2011, the Commission approved another amendment
to Article 20, Rule 2 to add all NMS stocks to the pilot rule.\8\
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    \4\ See Securities Exchange Act Release No. 62252 (June 10,
2010), 75 FR 34186 (June 16, 2010) approving SR-CHX-2010-10.
    \5\ See Securities Exchange Act Release No. 62884 (September 10,
2010), 75 FR 56618 (September 16, 2010) approving SR-CHX-2010-14.
    \6\ See Securities Exchange Act Release No. 34-63498 (December
9, 2010), 75 FR 78310 December 15, 2010) approving SR-CHX-2010-24.
    \7\ See Securities Exchange Act Release No. 64203 (April 6,
2011), 75 FR 20393 April 12, 2011) approving SR-CHX-2011-05.
    \8\ See Securities Exchange Act Release No. 64735 (June 23,
2011), 75 FR 38243 (June 29, 2011) approving SR-CHX-2011-09.
---------------------------------------------------------------------------

    The proposed rule change merely extends the duration of the pilot
program to January 31, 2012. Extending the pilot in this manner will
allow the Commission more time to consider the impact of the pilot
program.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b)(5) of the
Securities Exchange Act of 1934 (the ``Act''), which requires the rules
of an exchange to promote just and equitable principles of trade, to
remove impediments to and perfect the mechanism of a free and open
market and a national market system and, in general, to protect
investors and the public interest. The proposed rule change also is
designed to support the principles of Section 11A(a)(1) of the Act in
that it seeks to assure fair competition among brokers and dealers and
among exchange markets. The Exchange believes that the proposed rule
meets these requirements in that it promotes uniformity across markets
concerning decisions to pause trading in a security when there are
significant price movements.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.

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

    No written comments were either solicited or received.

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

    The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \9\ and Rule 19b-4(f)(6) thereunder.\10\
Because the proposed rule change does not: (i) Significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act \11\ and Rule 19b-
4(f)(6)(iii) thereunder.\12\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \10\ 17 CFR 240.19b-4(f)(6).
    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's intent to file the proposed rule change along with a
brief description and text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \13\ normally
does not become operative for 30 days after the date of filing.
However, pursuant to Rule 19b-4(f)(6)(iii) \14\ the Commission may
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposal
may become operative immediately upon filing.
---------------------------------------------------------------------------

    \13\ 17 CFR 240.19b-4(f)(6).
    \14\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    The Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest, as
it will allow the pilot program to continue uninterrupted, thereby
avoiding the investor confusion that could result from a temporary
interruption in the pilot program. For this reason, the Commission
designates the proposed rule change as operative upon filing.\15\
---------------------------------------------------------------------------

    \15\ For purposes only of waiving the 30-day operative delay,
the Commission has also considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to<EMAIL_ADDRESS>Please include
File No. SR-CHX-2011-23 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.

All submissions should refer to File No. SR-CHX-2011-23. This file
number should be included on the subject line if e-mail 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
a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; 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 No. SR-CHX-2011-23 and should be
submitted on or before September 6, 2011.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
---------------------------------------------------------------------------

    \16\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-20732 Filed 8-15-11; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 88, Number 214 (Tuesday, November 7, 2023)]
[Notices]
[Pages 76748-76750]
[FR Doc No: 2023-24593]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

Combined Notice of Filings #1

    Take notice that the Commission received the following electric
rate filings:

    Docket Numbers: ER10-1484-031; ER12-2381-017; ER13-1069-020; ER14-
1140-007.
    Applicants: Inspire Energy Holdings, LLC, MP2 Energy LLC, MP2
Energy NE LLC, Shell Energy North America (US), L.P.
    Description: Notice of Change in Status of Shell Energy North
America (US), L.P., et. al.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5330.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER10-2126-008.
    Applicants: Idaho Power Company.
    Description: Notice of Change in Status of Idaho Power Company.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5314.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER10-2354-013.
    Applicants: Midway-Sunset Cogeneration Company.
    Description: Notice of Non-Material Change in Status of Midway-
Sunset Cogeneration Company.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5337.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER12-1470-015; ER10-3026-013; ER16-1833-010.
    Applicants: Sempra Gas & Power Marketing, LLC, Termoelectrica U.S.,
LLC, Energia Sierra Juarez U.S., LLC.
    Description: Notice of Change in Status of Energia Sierra Juarez
U.S., LLC, et. al.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5331.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER15-1873-018; ER18-471-012; ER23-644-001; ER23-
645-001; ER23-646-002; ER23-647-002.
    Applicants: Diversion Wind Energy Holdings LLC, Wagon Wheel Wind
Project Holdings LLC, Wagon Wheel Wind Project, LLC, Diversion Wind
Energy LLC, States Edge Wind I LLC, Buckeye Wind Energy LLC.
    Description: Notice of Change in Status of Buckeye Wind Energy LLC,
et al.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5307.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER16-1004-002.
    Applicants: Roundtop Energy LLC.
    Description: Compliance filing: Roundtop Energy Informational
Filing to be effective N/A.
    Filed Date: 11/1/23.
    Accession Number: 20231101-5003.
    Comment Date: 5 p.m. ET 11/22/23.

    Docket Numbers: ER16-1032-002.
    Applicants: Beaver Dam Energy LLC.
    Description: Compliance filing: Beaver Dam Energy Informational
Filing to be effective N/A.
    Filed Date: 11/1/23.
    Accession Number: 20231101-5004.
    Comment Date: 5 p.m. ET 11/22/23.

    Docket Numbers: ER16-1999-002; ER11-4625-008; ER14-608-006; ER16-
1644-006; ER16-1998-002; ER16-2000-002; ER16-2001-002; ER16-2002-002;
ER16-2003-002; ER16-2006-002; ER19-537-005.
    Applicants: MRP San Joaquin Energy, LLC, CalPeak Power--Vaca Dixon
LLC, CalPeak Power--Panoche LLC, Midway Peaking, LLC, Malaga Power,
LLC, CalPeak Power--Enterprise LLC, CalPeak Power--Border LLC,MRP
Generation Holdings, LLC, High Desert Power Project, LLC, Colton Power
L.P., CalPeak Power LLC.
    Description: Notice of Non-Material Change in Status of CalPeak
Power LLC, et. al.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5341.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER17-440-005.
    Applicants: Alpaca Energy LLC.
    Description: Compliance filing: Alapaca Energy Informational Filing
to be effective N/A.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5272.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER17-444-005.
    Applicants: Milan Energy LLC.
    Description: Compliance filing: Milan Energy Informational Filing
to be effective N/A.
    Filed Date:10/31/23.
    Accession Number: 20231031-5278.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER17-1742-008; ER13-2490-012; ER17-311-008; ER19-
2595-007; ER19-2670-007; ER19-2671-007; ER19-2672-007; ER20-1073-006;
ER20-2510-006; ER20-2512-006; ER20-2515-006; ER20-2663-006; ER21-2406-
005; ER21-2407-005; ER21-2408-005; ER21-2409-005; ER21-2638-005; ER22-
734-004; ER22-2028-003; ER22-2421-002; ER22-2423-002; ER22-2425-002;
ER22-2427-002.
    Applicants: SR Cedar Springs, LLC, SR Clay, LLC, SR DeSoto I
Lessee, LLC, SR DeSoto I, LLC, SR Hazlehurst, LLC, SR Arlington, LLC,
SR Perry, LLC, SR Snipesville II, LLC, SR Lumpkin, LLC, SR Georgia
Portfolio II Lessee, LLC, Lancaster Solar LLC, SR Snipesville, LLC, SR
Georgia Portfolio I MT, LLC, SR Baxley, LLC, Odom Solar LLC, SR
Terrell, LLC, SR Arlington II MT, LLC, SR Arlington II, LLC, SR
Meridian III, LLC, SR Hazlehurst III, LLC, SR South Loving LLC, Simon
Solar, LLC, Hattiesburg Farm, LLC.
    Description: Notice of Non-Material Change in Status of Hattiesburg
Farm, LLC, et. al.

    Filed Date: 10/31/23.
    Accession Number: 20231031-5350.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER18-2511-006.
    Applicants: NorthWestern Corporation.
    Description: Notice of Change in Status of NorthWestern Corporation
under ER18-2511.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5332.
    Comment Date: 5 p.m. ET 11/30/23.

    Docket Numbers: ER19-647-004.
    Applicants: Wolf Run Energy LLC.
    Description: Compliance filing: Wolf Run Energy Informational
Filing to be effective N/A.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5281.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER19-2847-005.
    Applicants: Oxbow Creek Energy LLC.
    Description: Compliance filing: Oxbow Creek Energy Informational
Filing to be effective N/A.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5279.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER23-2234-001; ER23-2233-001; ER23-2235-001; ER23-
2236-001; ER23-2237-001; ER23-2238-001; ER23-2240-001; ER23-2241-001;
ER23-2242-001; ER23-2243-001; ER23-2244-001; ER23-2245-001.
    Applicants: Pixley Solar Energy LLC, Pixley Solar Energy Holdings
LLC, Lazbuddie Wind Energy LLC, Lazbuddie Wind Energy Holdings LLC,
Flat Ridge 5 Wind Energy LLC, Flat Ridge 5 Wind Energy Holdings LLC,
Flat Ridge 4 Wind, LLC, Flat Ridge 4 Wind Holdings LLC, Chisholm Trail
Solar Energy LLC, Chisholm Trail Solar Energy Holdings LLC, Algodon
Solar Energy Holdings LLC, Algodon Solar Energy LLC.
    Description: Notice of Change in Status of Algodon Solar Energy
LLC, et al.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5313.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER23-2398-002.
    Applicants: Arizona Public Service Company.
    Description: Compliance filing: Amendment No. 1 to APS Compliance
Filing on Interconnection Reforms to be effective 9/30/2023.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5268.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER24-198-001.
    Applicants: El Paso Electric Company.
    Description: Tariff Amendment: Service Agreement No. 355,
Simultaneous Exchange with Dynasty or Alternative to be effective 12/
31/2023.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5287.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER24-274-000.
    Applicants: Duke Energy Carolinas, LLC.
    Description: 205(d) Rate Filing: DEC-City of Orangeburg PPA Rate
Schedule No. 631 to be effective 1/1/2024.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5261.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER24-275-000.
    Applicants: ISO New England Inc., New England Power Pool
Participants Committee.
    Description: 205(d) Rate Filing: ISO New England Inc. submits
tariff filing per 35.13(a)(2)(iii): Rev. to Est. a Jointly Optimized
Day-Ahead Mkt. for Energy & Ancillary Services to be effective 3/1/
2025.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5266.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER24-276-000.
    Applicants: New England Power Pool Participants Committee.
    Description: 205(d) Rate Filing: Nov 2023 Membership Filing to be
effective 11/1/2023.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5275.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER24-277-000.
    Applicants: FirstEnergy Pennsylvania Electric Company.
    Description: Baseline eTariff Filing: 2023-10-31--Revisions to Agmt
to Which Met Ed, Penelec & West Penn are Parties to be effective 10/31/
2023.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5290.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER24-278-000.
    Applicants: Hartree Partners, LP.
    Description: Compliance filing: MBR Change of Status of Hartree
Partners, LP to be effective 10/31/2023.
    Filed Date: 10/31/23.
    Accession Number: 20231031-5292.
    Comment Date: 5 p.m. ET 11/21/23.

    Docket Numbers: ER24-279-000.
    Applicants: NE Renewable Power, LLC.
    Description: Compliance filing: MBR Change in Status of NE
Renewable Power, LLC to be effective 10/31/2023.
    Filed Date: 11/1/23.
    Accession Number: 20231101-5000.
    Comment Date: 5 p.m. ET 11/22/23.

    Docket Numbers: ER24-280-000.
    Applicants: EIF Newark, LLC.
    Description: Compliance filing: MBR Change in Status of Hartree-
Meadowlands Newark, LLC to be effective 10/31/2023.
    Filed Date: 11/1/23.
    Accession Number: 20231101-5001.
    Comment Date: 5 p.m. ET 11/22/23.

    Docket Numbers: ER24-281-000.
    Applicants: Newark Energy Center, LLC.
    Description: Compliance filing: MBR Change in Status of Newark
Energy Center, LLC to be effective 10/31/2023.
    Filed Date: 11/1/23.
    Accession Number: 20231101-5002.
    Comment Date: 5 p.m. ET 11/22/23.

    Docket Numbers: ER24-282-000.
    Applicants: Pacific Gas and Electric Company.
    Description: Tariff Amendment: APPENDIX IX : STAR Process
Termination TO Tariff to be effective 1/1/2024.
    Filed Date: 11/1/23.
    Accession Number: 20231101-5005.
    Comment Date: 5 p.m. ET 11/22/23.

    Docket Numbers: ER24-283-000.
    Applicants: Midcontinent Independent System Operator, Inc., ALLETE,
Inc.
    Description: 205(d) Rate Filing: Midcontinent Independent System
Operator, Inc. submits tariff filing per 35.13(a)(2)(iii): 2023-11-
01_SA 4162 MP-GRE T-T (Portage Lake) to be effective 10/30/2023.
    Filed Date: 11/1/23.
    Accession Number: 20231101-5010.
    Comment Date: 5 p.m. ET 11/22/23.

    The filings are accessible in the Commission's eLibrary system
(https://elibrary.ferc.gov/idmws/search/fercgensearch.asp) by querying
the docket number.
    Any person desiring to intervene, to protest, or to answer a
complaint in any of the above proceedings must file in accordance with
Rules 211, 214, or 206 of the Commission's Regulations (18 CFR 385.211,
385.214, or 385.206) on or before 5:00 p.m. Eastern time on the
specified comment date. Protests may be considered, but intervention is
necessary to become a party to the proceeding.
    eFiling is encouraged. More detailed information relating to filing
requirements, interventions, protests, service, and qualifying
facilities filings can be found at: http://www.ferc.gov/docs-filing/efiling/filing-req.pdf. For other information, call<PHONE_NUMBER>
(toll free). For TTY, call<PHONE_NUMBER>.
    The Commission's Office of Public Participation (OPP) supports
meaningful public engagement and participation in Commission
proceedings. OPP can help members of the public, including landowners,
environmental justice communities, Tribal members and others, access
publicly available information and navigate Commission

processes. For public inquiries and assistance with making filings such
as interventions, comments, or requests for rehearing, the public is
encouraged to contact OPP at<PHONE_NUMBER> or [email protected].

    Dated: November 1, 2023.
Debbie-Anne A. Reese,
Deputy Secretary.
[FR Doc. 2023-24593 Filed 11-6-23; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 77, Number 160 (Friday, August 17, 2012)]
[Notices]
[Pages 49839-49846]
[FR Doc No: 2012-20264]

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SECURITIES AND EXCHANGE COMMISSION

[Investment Company Act Release No. 30166; 812-13956]

IndexIQ Advisors LLC and IndexIQ Active ETF Trust; Notice of
Application

August 13, 2012.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Notice of an application for an order under section 6(c) of the
Investment Company Act of 1940 (``Act'') for an exemption from sections
2(a)(32), 5(a)(1), 22(d) and 22(e) of the Act and rule 22c-1 under the
Act, under sections 6(c) and 17(b) of the Act for an exemption from
sections 17(a)(1) and (a)(2) of the Act, and under section 12(d)(1)(J)
for an exemption from sections 12(d)(1)(A) and (B) of the Act.

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APPLICANTS: IndexIQ Advisors LLC (``IndexIQ'') and IndexIQ Active ETF
Trust (the ``Trust'').

SUMMARY OF APPLICATION: Applicants request an order that permits: (a)
Actively-managed series of certain open-end management investment
companies to issue shares (``Shares'') redeemable in large aggregations
only (``Creation Units''); (b) secondary market transactions in Shares
to occur at negotiated market prices; (c) certain series to pay
redemption proceeds, under certain circumstances, more than seven days
from the tender of Shares for redemption; (d) certain affiliated
persons of the series to deposit securities into, and receive
securities from, the series in connection with the purchase and
redemption of Creation Units; and (e) certain registered management
investment companies and unit investment trusts outside of the same
group of investment companies as the series to acquire Shares.

FILING DATES: The application was filed on September 9, 2011, and
amended on March 27, 2012, July 6, 2012, and July 16, 2012. Applicants
have agreed to file an amendment during the notice period, the
substance of which is reflected in this notice.

HEARING OR NOTIFICATION OF HEARING: An order granting the requested
relief will be issued unless the Commission orders a hearing.
Interested persons may request a hearing by writing to the Commission's
Secretary and serving applicants with a copy of the request, personally
or by mail. Hearing requests should be received by the Commission by
5:30 p.m. on September 7, 2012, and should be accompanied by proof of
service on applicants, in the form of an affidavit or, for lawyers, a
certificate of service. Hearing requests should state the nature of the
writer's interest, the reason for the request, and the issues
contested. Persons who wish to be notified of a hearing may request
notification by writing to the Commission's Secretary.

ADDRESSES: Elizabeth M. Murphy, Secretary, U.S. Securities and Exchange
Commission, 100 F Street NE., Washington, DC 20549-1090. Applicants,
800 Westchester Drive, Suite N-611, Rye Brook, NY 10573.

FOR FURTHER INFORMATION CONTACT: Jean E. Minarick, Senior Counsel, at
(202) 551-6811 or Daniele Marchesani, Branch Chief, at<PHONE_NUMBER>
(Division of Investment Management, Office of Investment Company
Regulation).

SUPPLEMENTARY INFORMATION: The following is a summary of the
application. The complete application may be obtained via the
Commission's Web site by searching for the file number, or an applicant
using the Company name box, at http://www.sec.gov/search/search.htm or
by calling<PHONE_NUMBER>.

Applicants' Representations

    1. The Trust will be registered as an open-end management
investment company under the Act and is a statutory trust organized
under the laws of Delaware. The Trust will initially offer three
actively-managed investment series, IQ Global Equity Active ETF
(``Global Equity ETF''), IQ Global Fixed Income Active ETF (``Global
Fixed Income ETF'') and IQ Long-Short Active ETF (``Long-Short ETF'')
(together, the ``Initial Funds''). The investment objective of the
Global Equity ETF will be to seek long-term capital appreciation by
investing primarily in U.S. and international equity securities. The
investment objective of the Global Fixed Income ETF will be to seek as
high a level of current income as is consistent with preservation of
capital. The investment objective of the Long-Short ETF will be to seek
long-term capital appreciation by investing primarily in U.S. and
international equity securities.
    2. IndexIQ, a Delaware limited liability company, will serve as
investment adviser to the Initial Funds. An Adviser (as defined below)
may in the future retain one or more sub-advisers (``Fund Sub-
Advisers'') to manage the portfolio of the Funds (as defined below).
Any other Adviser and any Fund Sub-Adviser will be registered or exempt
from registration under the Investment Advisers Act of 1940 (``Advisers
Act''). A registered broker-dealer under the Securities Exchange Act of
1934 (``Exchange Act''), which may be an affiliate of the Adviser, will
act as the distributor and principal underwriter of the Funds
(``Distributor'').
    3. Applicants request that the order apply to the Initial Funds and
any future series of the Trust or of any other open-end management
companies that may use active management investment strategies
(``Future Funds''). Any Future Fund will (a) be advised by IndexIQ or
an entity controlling, controlled by, or under common control with
IndexIQ (together with IndexIQ, an ``Adviser''), and (b) comply with
the terms and conditions of the application.\1\ The Initial Funds and
Future Funds together are the ``Funds''. Each Fund will consist of a
portfolio of securities (including fixed income securities and/or
equity securities) and/or currencies and other assets (``Portfolio
Instruments'').\2\ Funds may invest in ``Depositary Receipts''. A Fund
will not invest in any Depositary Receipts that the Adviser deems to be
illiquid or for which pricing information is not readily available.\3\
Each Fund will operate as an actively managed exchange-traded fund
(``ETF''). The Funds may invest in other open-end and/or closed-end
investment companies and/or ETFs.
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    \1\ All entities that currently intend to rely on the order are
named as applicants. Any other entity that relies on the order in
the future will comply with the terms and conditions of the
application. An Investing Fund (as defined below) may rely on the
order only to invest in Funds and not in any other registered
investment company.
    \2\ Neither the Initial Funds nor any Future Fund will invest in
options contracts, futures contracts, or swap agreements.
    \3\ Depositary Receipts are typically issued by a financial
institution, a ``depositary'', and evidence ownership in a security
or pool of securities that have been deposited with the depositary.
No affiliated persons of a Fund, Adviser or any Fund Sub-Adviser
will serve as the depositary bank for any Depositary Receipts held
by a Fund.
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    4. Applicants also request that any exemption under section
12(d)(1)(J) of the Act from sections 12(d)(1)(A) and (B) apply to: (i)
Any Fund that is currently or subsequently part of the same ``group of
investment companies'' as an Initial Fund within the meaning of section
12(d)(1)(G)(ii) of the Act; (ii) any principal underwriter for the
Fund; (iii) any brokers selling Shares of a Fund to an Investing Fund
(as defined below); and (iv) each management investment company or unit
investment trust registered under the Act that is not part of the same
``group of investment companies'' as the Funds within the meaning of
section 12(d)(1)(G)(ii) of the Act and that enters into a FOF
Participation Agreement (as defined below) with a Fund (such management
investment companies, ``Investing Management Companies,'' such unit
investment trusts, ``Investing Trusts,'' and Investing Management
Companies and Investing Trusts together, ``Investing Funds'').
Investing Funds do not include the Funds.
    5. Applicants anticipate that a Creation Unit will consist of at
least 50,000 Shares and that the price of a Share will range from $15
to $100. All orders to purchase Creation Units must be placed with the
Distributor by or through a party that has entered into a participant
agreement with the Distributor and the Trust (``Authorized
Participant'') with respect to the creation and redemption of Creation
Units. An Authorized Participant is either: (a) a broker or dealer
registered under the Exchange Act (``Broker'') or other participant in
the Continuous Net

Settlement System of the National Securities Clearing Corporation, a
clearing agency registered with the Commission and affiliated with the
Depository Trust Company (``DTC''), or (b) a participant in the DTC
(such participant, ``DTC Participant''). The Shares will be purchased
and redeemed in Creation Units and generally on an in-kind basis.
Except where the purchase or redemption will include cash under the
limited circumstances specified below, purchasers will be required to
purchase Creation Units by making an in-kind deposit of specified
instruments (``Deposit Instruments''), and shareholders redeeming their
Shares will receive an in-kind transfer of specified instruments
(``Redemption Instruments'').\4\ On any given Business Day \5\ the
names and quantities of the instruments that constitute the Deposit
Instruments and the names and quantities of the instruments that
constitute the Redemption Instruments will be identical, and these
instruments may be referred to, in the case of either a purchase or
redemption, as the ``Creation Basket.'' In addition, the Creation
Basket will correspond pro rata to the positions in a Fund's portfolio
(including cash positions),\6\ except (a) in the case of bonds, for
minor differences when it is impossible to break up bonds beyond
certain minimum sizes needed for transfer and settlement; (b) for minor
differences when rounding is necessary to eliminate fractional shares
or lots that are not tradeable round lots;\7\ or (c) TBA
Transactions,\8\ short positions and other positions that cannot be
transferred in kind \9\ will be excluded from the Creation Basket.\10\
If there is a difference between the net asset value (``NAV'')
attributable to a Creation Unit and the aggregate market value of the
Creation Basket exchanged for the Creation Unit, the party conveying
instruments with the lower value will also pay to the other an amount
in cash equal to that difference (the ``Cash Amount'').
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    \4\ The Funds must comply with the federal securities laws in
accepting Deposit Instruments and satisfying redemptions with
Redemption Instruments, including that the Deposit Instruments and
Redemption Instruments are sold in transactions that would be exempt
from registration under the Securities Act of 1933 (``Securities
Act''). In accepting Deposit Instruments and satisfying redemptions
with Redemption Instruments that are restricted securities eligible
for resale pursuant to Rule 144A under the Securities Act, the Funds
will comply with the conditions of Rule 144A.
    \5\ Each Fund will sell and redeem Creation Units on any day the
Fund is open, including as required by section 22(e) of the Act
(each, a ``Business Day'').
    \6\ The portfolio used for this purpose will be the same
portfolio used to calculate the Fund's NAV for that Business Day.
    \7\ A tradeable round lot for a security will be the standard
unit of trading in that particular type of security in its primary
market.
    \8\ A TBA Transaction is a method of trading mortgage-backed
securities. In a TBA Transaction, the buyer and seller agree on
general trade parameters such as agency, settlement date, par amount
and price.
    \9\ This includes instruments that can be transferred in kind
only with the consent of the original counterparty to the extent the
Fund does not intend to seek such consents.
    \10\ Because these instruments will be excluded from the
Creation Basket, their value will be reflected in the determination
of the Cash Amount (as defined below).
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    6. Purchases and redemptions of Creation Units may be made in whole
or in part on a cash basis, rather than in kind, solely under the
following circumstances: (a) To the extent there is a Cash Amount, as
described above; (b) if, on a given Business Day, a Fund announces
before the open of trading that all purchases, all redemptions or all
purchases and redemptions on that day will be made entirely in cash;
(c) if, upon receiving, a purchase or redemption order from an
Authorized Participant, a Fund determines to require the purchase or
redemption, as applicable, to be made entirely in cash; (d) if, on a
given Business Day, a Fund requires all Authorized Participants
purchasing or redeeming Shares on that day to deposit or receive (as
applicable) cash in lieu of some or all of the Deposit Instruments or
Redemption Instruments, respectively, solely because (i) such
instruments are not eligible for transfer through either the NSCC
Process or DTC Process; or (ii) in the case of Funds holding securities
traded on global markets (``Foreign Funds''), such instruments are not
eligible for trading due to local trading restrictions, local
restrictions on securities transfers or other similar circumstances; or
(e) if a Fund permits an Authorized Participant to deposit or receive
(as applicable) cash in lieu of some or all of the Deposit Instruments
or Redemption Instruments, respectively, solely because: (i) Such
instruments are, in the case of the purchase of a Creation Unit, not
available in sufficient quantity; (ii) such instruments are not
eligible for trading by an Authorized Participant or the investor on
whose behalf the Authorized Participant is acting; or (iii) a holder of
Shares of a Foreign Fund would be subject to unfavorable income tax
treatment if the holder receives redemption proceeds in kind.\11\
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    \11\ A ``custom order'' is any purchase or redemption of Shares
made in whole or in part on a cash basis in reliance on clause
(e)(i) or (e)(ii).
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    7. Each Business Day, before the open of trading on a national
securities exchange as defined in section 2(a)(26) of the Act (``Stock
Exchange''), on which Shares are listed, each Fund will cause to be
published through the NSCC the names and quantities of the instruments
comprising the Creation Basket, as well as the estimated Cash Amount
(if any), for that day. The published Creation Basket will apply until
a new Creation Basket is announced on the following Business Day, and
there will be no intra-day changes to the Creation Basket except to
correct errors in the published Creation Basket. A Stock Exchange will
disseminate every 15 seconds throughout the trading day an amount
representing, on a per Share basis, the sum of the current value of the
Deposit Instruments and the estimated Cash Amount.
    8. An investor purchasing or redeeming a Creation Unit from a Fund
may be charged a fee (``Transaction Fee'') to protect existing
shareholders of the Funds from the dilutive costs associated with the
purchase and redemption of Creation Units.\12\ All orders to purchase
Creation Units will be placed with the Distributor by or through an
Authorized Participant, and the Distributor will transmit all purchase
orders to the relevant Fund. The Distributor will be responsible for
delivering a prospectus (``Prospectus'') to those persons purchasing
Creation Units and for maintaining records of both the orders placed
with it and the confirmations of acceptance furnished by it.
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    \12\ Where a Fund permits an in-kind purchaser to substitute
cash in lieu of depositing one or more Deposit Instruments, the
purchaser may be assessed a higher Transaction Fee to offset the
cost to the Fund of buying those particular Deposit Instruments.
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    9. Shares will be listed and traded at negotiated prices on a Stock
Exchange and traded in the secondary market. Applicants expect that
market makers (``Market Makers'') will be assigned to Shares. The price
of Shares trading on the Stock Exchange will be based on a current bid/
offer in the secondary market. Transactions involving the purchases and
sales of Shares on the Stock Exchange will be subject to customary
brokerage commissions and charges.
    10. Applicants expect that purchasers of Creation Units will
include institutional investors and arbitrageurs. Market Makers, acting
in their unique role to provide a fair and orderly secondary market for
Shares, also may purchase Creation Units for use in their own market
making activities.\13\

Applicants expect that secondary market purchasers of Shares will
include both institutional and retail investors.\14\ Applicants expect
that arbitrage opportunities created by the ability to continually
purchase or redeem Creation Units at their NAV per Share should ensure
that the Shares will not trade at a material discount or premium in
relation to their NAV.
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    \13\ There will be at least one Market Maker on the Stock
Exchange for a Fund's Shares (e.g., NYSE Arca would designate a Lead
Market Maker) to maintain a market for such Fund's Shares. No Market
Maker will be an affiliated person, or an affiliated person of an
affiliated person, of the Funds, except within section 2(a)(3)(A) or
(C) of the Act due to ownership of Shares, as described below.
    \14\ Shares will be registered in book-entry form only. DTC or
its nominee will be the record or registered owner of all
outstanding Shares. Beneficial ownership of Shares will be shown on
the records of DTC or DTC Participants.
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    11. Shares will not be individually redeemable and owners of Shares
may acquire those Shares from a Fund, or tender such shares for
redemption to the Fund, in Creation Units only. To redeem, an investor
must accumulate enough Shares to constitute a Creation Unit. Redemption
requests must be placed by or through an Authorized Participant. As
discussed above, redemptions of Creation Units will generally be made
on an in-kind basis, subject to certain specified exceptions under
which redemptions may be made in whole or in part on a cash basis, and
will be subject to a Transaction Fee.
    12. Neither the Trust nor any Fund will be marketed or otherwise
held out as a ``mutual fund.'' Instead, each Fund will be marketed as
an ``actively-managed exchange-traded fund.'' In any advertising
material where features of obtaining, buying or selling Shares traded
on the Stock Exchange are described there will be an appropriate
statement to the effect that Shares are not individually redeemable.
    13. The Funds' Web site, which will be publicly available prior to
the public offering of Shares, will include the Prospectus and
additional quantitative information updated on a daily basis, including
on a per Share basis for each Fund, the prior Business Day's NAV and
the market closing price or mid-point of the bid/ask spread at the time
of the calculation of such NAV (``Bid/Ask Price''), and a calculation
of the premium or discount of the market closing price or Bid/Ask Price
against such NAV. On each Business Day, before commencement of trading
in Shares on the Stock Exchange, the Fund will disclose on its Web site
the identities and quantities of the Portfolio Instruments, held by the
Fund that will form the basis for the Fund's calculation of NAV at the
end of the Business Day.\15\
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    \15\ Applicants note that under accounting procedures followed
by the Funds, trades made on the prior Business Day will be booked
and reflected in NAV on the current Business Day. Accordingly, the
Funds will be able to disclose at the beginning of the Business Day
the portfolio that will form the basis for the NAV calculation at
the end of the Business Day.
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Applicants' Legal Analysis

    1. Applicants request an order under section 6(c) of the Act for an
exemption from sections 2(a)(32), 5(a)(1), 22(d) and 22(e) of the Act
and rule 22c-1 under the Act, under sections 6(c) and 17(b) of the Act
for an exemption from sections 17(a)(1) and 17(a)(2) of the Act, and
under section 12(d)(1)(J) of the Act for an exemption from sections
12(d)(1)(A) and (B) of the Act.
    2. Section 6(c) of the Act provides that the Commission may exempt
any person, security or transaction, or any class of persons,
securities or transactions, from any provisions of the Act, if and to
the extent that such exemption is necessary or appropriate in the
public interest and consistent with the protection of investors and the
purposes fairly intended by the policy and provisions of the Act.
Section 17(b) of the Act authorizes the Commission to exempt a proposed
transaction from section 17(a) of the Act if evidence establishes that
the terms of the transaction, including the consideration to be paid or
received, are reasonable and fair and do not involve overreaching on
the part of any person concerned, and the proposed transaction is
consistent with the policies of the registered investment company and
the general provisions of the Act. Section 12(d)(1)(J) of the Act
provides that the Commission may exempt any person, security, or
transaction, or any class or classes of persons, securities or
transactions, from any provision of section 12(d)(1) if the exemption
is consistent with the public interest and the protection of investors.

Sections 5(a)(1) and 2(a)(32) of the Act

    3. Section 5(a)(1) of the Act defines an ``open-end company'' as a
management investment company that is offering for sale or has
outstanding any redeemable security of which it is the issuer. Section
2(a)(32) of the Act defines a redeemable security as any security,
other than short-term paper, under the terms of which the holder, upon
its presentation to the issuer, is entitled to receive approximately a
proportionate share of the issuer's current net assets, or the cash
equivalent. Because Shares will not be individually redeemable,
applicants request an order that would permit each Fund to redeem
Shares in Creation Units only. Applicants state that investors may
purchase Shares in Creation Units from each Fund and redeem Creation
Units from each Fund. Applicants further state that because the market
price of Creation Units will be disciplined by arbitrage opportunities,
investors should be able to sell Shares in the secondary market at
prices that do not vary materially from their NAV.

Section 22(d) of the Act and Rule 22c-1 Under the Act

    4. Section 22(d) of the Act, among other things, prohibits a dealer
from selling a redeemable security that is currently being offered to
the public by or through a principal underwriter, except at a current
public offering price described in the prospectus. Rule 22c-1 under the
Act generally requires that a dealer selling, redeeming, or
repurchasing a redeemable security do so only at a price based on its
NAV. Applicants state that secondary market trading in Shares will take
place at negotiated prices, not at a current offering price described
in the Prospectus, and not at a price based on NAV. Thus, purchases and
sales of Shares in the secondary market will not comply with section
22(d) of the Act and rule 22c-1 under the Act. Applicants request an
exemption under section 6(c) from these provisions.
    5. Applicants assert that the concerns sought to be addressed by
section 22(d) of the Act and rule 22c-1 under the Act with respect to
pricing are equally satisfied by the proposed method of pricing Shares.
Applicants maintain that while there is little legislative history
regarding section 22(d), its provisions, as well as those of rule 22c-
1, appear to have been designed to (a) prevent dilution caused by
certain riskless-trading schemes by principal underwriters and contract
dealers, (b) prevent unjust discrimination or preferential treatment
among buyers resulting from sales at different prices, and (c) assure
an orderly distribution system of investment company shares by
eliminating price competition from brokers offering shares at less than
the published sales price and repurchasing shares at more than the
published redemption price.
    6. Applicants believe that none of these purposes will be thwarted
by permitting Shares to trade in the secondary market at negotiated
prices. Applicants state that (a) secondary market trading in Shares
does not involve the Funds as parties and cannot result in dilution of
an investment in Shares, and (b) to the extent different prices exist
during a given trading day, or from day to day, such variances occur as
a result of third-party market forces, such as supply and demand.
Therefore, applicants assert that secondary market transactions in
Shares will not lead to discrimination or preferential treatment

among purchasers. Finally, applicants contend that the proposed
distribution system will be orderly because arbitrage activity should
ensure that the difference between the market price of Shares and their
NAV remains narrow.

Section 22(e) of the Act

    7. Section 22(e) of the Act generally prohibits a registered
investment company from suspending the right of redemption or
postponing the date of payment of redemption proceeds for more than
seven days after the tender of a security for redemption. Applicants
observe that settlement of redemptions of Creation Units of Foreign
Funds is contingent not only on the settlement cycle of the U.S.
securities markets but also on the delivery cycles present in foreign
markets in which those Funds invest. Applicants have been advised that,
under certain circumstances, the delivery cycles for transferring
Portfolio Instruments to redeeming investors, coupled with local market
holiday schedules, will require a delivery process of up to 15 calendar
days. Applicants therefore request relief from section 22(e) in order
to provide payment or satisfaction of redemptions within the maximum
number of calendar days required for such payment or satisfaction, up
to a maximum of 15 calendar days, in the principal local markets where
transactions in the Portfolio Instruments of each Foreign Fund
customarily clear and settle, but in all cases no later than 15
calendar days following the tender of a Creation Unit.
    8. Applicants state that section 22(e) was designed to prevent
unreasonable, undisclosed and unforeseen delays in the actual payment
of redemption proceeds. Applicants assert that the requested relief
will not lead to the problems that section 22(e) was designed to
prevent. Applicants state that allowing redemption payments for
Creation Units of a Fund to be made within a maximum of 15 calendar
days would not be inconsistent with the spirit and intent of section
22(e). Applicants state the SAI will disclose those local holidays
(over the period of at least one year following the date of the SAI),
if any, that are expected to prevent the delivery of redemption
proceeds in seven calendar days and the maximum number of days needed
to deliver the proceeds for each affected Foreign Fund. Applicants are
not seeking relief from section 22(e) with respect to Foreign Funds
that do not effect creations or redemptions in-kind.

Section 12(d)(1) of the Act

    9. Section 12(d)(1)(A) of the Act prohibits a registered investment
company from acquiring shares of an investment company if the
securities represent more than 3% of the total outstanding voting stock
of the acquired company, more than 5% of the total assets of the
acquiring company, or, together with the securities of any other
investment companies, more than 10% of the total assets of the
acquiring company. Section 12(d)(1)(B) of the Act prohibits a
registered open-end investment company, its principal underwriter, or
any other broker or dealer from selling its shares to another
investment company if the sale will cause the acquiring company to own
more than 3% of the acquired company's voting stock, or if the sale
will cause more than 10% of the acquired company's voting stock to be
owned by investment companies generally.
    10. Applicants request relief to permit Investing Funds to acquire
Shares in excess of the limits in section 12(d)(1)(A) of the Act and to
permit the Funds, their principal underwriters and any Broker to sell
Shares to Investing Funds in excess of the limits in section
12(d)(l)(B) of the Act. Applicants submit that the proposed conditions
to the requested relief address the concerns underlying the limits in
section 12(d)(1), which include concerns about undue influence,
excessive layering of fees and overly complex structures.
    11. Applicants submit that their proposed conditions address any
concerns regarding the potential for undue influence. To limit the
control that an Investing Fund may have over a Fund, applicants propose
a condition prohibiting the adviser of an Investing Management Company
(``Investing Fund Adviser'), sponsor of an Investing Trust
(``Sponsor''), any person controlling, controlled by, or under common
control with the Investing Fund Adviser or Sponsor, and any investment
company or issuer that would be an investment company but for sections
3(c)(1) or 3(c)(7) of the Act that is advised or sponsored by the
Investing Fund Adviser, the Sponsor, or any person controlling,
controlled by, or under common control with the Investing Fund Adviser
or Sponsor (``Investing Fund's Advisory Group'') from controlling
(individually or in the aggregate) a Fund within the meaning of section
2(a)(9) of the Act. The same prohibition would apply to any sub-adviser
to an Investing Management Company (``Sub-Adviser''), any person
controlling, controlled by or under common control with the Sub-
Adviser, and any investment company or issuer that would be an
investment company but for sections 3(c)(1) or 3(c)(7) of the Act (or
portion of such investment company or issuer) advised or sponsored by
the Sub-Adviser or any person controlling, controlled by or under
common control with the Sub-Adviser (``Investing Fund's Sub-Advisory
Group'').
    12. Applicants propose a condition to ensure that no Investing Fund
or Investing Fund Affiliate \16\ (except to the extent it is acting in
its capacity as an investment adviser to a Fund) will cause a Fund to
purchase a security in an offering of securities during the existence
of an underwriting or selling syndicate of which a principal
underwriter is an Underwriting Affiliate (``Affiliated Underwriting'').
An ``Underwriting Affiliate'' is a principal underwriter in any
underwriting or selling syndicate that is an officer, director, member
of an advisory board, Investing Fund Adviser, Sub-Adviser, employee or
Sponsor of the Investing Fund, or a person of which any such officer,
director, member of an advisory board, Investing Fund Adviser, Sub-
Adviser, employee or Sponsor is an affiliated person (except any person
whose relationship to the Fund is covered by section 10(f) of the Act
is not an Underwriting Affiliate).
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    \16\ An ``Investing Fund Affiliate'' is any Investing Fund
Adviser, Sub-Adviser, Sponsor, promoter and principal underwriter of
an Investing Fund, and any person controlling, controlled by or
under common control with any of these entities. ``Fund Affiliate''
is an investment adviser, promoter, or principal underwriter of a
Fund or any person controlling, controlled by or under common
control with any of these entities.
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    13. Applicants propose several conditions to address the potential
for layering of fees. Applicants note that the board of directors or
trustees (``Board'') of any Investing Management Company, including a
majority of the directors or trustees who are not ``interested
persons'' within the meaning of section 2(a)(19) of the Act
(``disinterested directors or trustees''), will be required to find
that the advisory fees charged under the contract are based on services
provided that will be in addition to, rather than duplicative of,
services provided under the advisory contract of any Fund in which the
Investing Management Company may invest. Applicants also state that any
sales charges and/or service fees charged with respect to shares of an
Investing Fund will not exceed the limits applicable to

a fund of funds as set forth in NASD Conduct Rule 2830.\17\
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    \17\ Any reference to NASD Conduct Rule 2830 includes any
successor or replacement rule that may be adopted by the Financial
Industry Regulatory Authority.
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    14. Applicants submit that the proposed arrangement will not create
an overly complex fund structure. Applicants note that a Fund will be
prohibited from acquiring securities of any investment company or
company relying on section 3(c)(1) or 3(c)(7) of the Act in excess of
the limits contained in section 12(d)(1)(A) of the Act, except to the
extent permitted by exemptive relief from the Commission permitting the
Fund to purchase shares of other investment companies for short-term
cash management purposes.
    15. To ensure that an Investing Fund is aware of the terms and
conditions of the requested order, the Investing Funds must enter into
an agreement with the respective Funds (``FOF Participation
Agreement''). The FOF Participation Agreement will include an
acknowledgement from the Investing Fund that it may rely on the order
only to invest in a Fund and not in any other investment company.

Sections 17(a)(1) and (2) of the Act

    16. Section 17(a) of the Act generally prohibits an affiliated
person of a registered investment company, or an affiliated person of
such a person (``second tier affiliate''), from selling any security to
or purchasing any security from the company. Section 2(a)(3) of the Act
defines ``affiliated person'' to include any person directly or
indirectly owning, controlling, or holding with power to vote, 5% or
more of the outstanding voting securities of the other person and any
person directly or indirectly controlling, controlled by, or under
common control with, the other person. Section 2(a)(9) of the Act
defines ``control'' as the power to exercise a controlling influence
over the management or policies of a company and provides that a
control relationship will be presumed where one person owns more than
25% of another person's voting securities. Each Fund may be deemed to
be controlled by an Adviser and hence affiliated persons of each other.
In addition, the Funds may be deemed to be under common control with
any other registered investment company (or series thereof) advised by
an Adviser (an ``Affiliated Fund'').
    17. Applicants request an exemption under sections 6(c) and 17(b)
of the Act from sections 17(a)(1) and 17(a)(2) of the Act to permit in-
kind purchases and redemptions of Creation Units by persons that are
affiliated persons or second tier affiliates of the Funds solely by
virtue of one or more of the following: (a) Holding 5% or more, or in
excess of 25%, of the outstanding Shares of one or more Funds; (b)
having an affiliation with a person with an ownership interest
described in (a); or (c) holding 5% or more, or more than 25% of the
Shares of one or more Affiliated Funds.\18\ Applicants also request an
exemption in order to permit a Fund to sell its Shares to and redeem
its Shares from, and engage in the in-kind transactions that would
accompany such sales and redemptions with, certain Investing Funds of
which the Funds are an affiliated person or a second tier
affiliate.\19\
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    \18\ Applicants are not seeking relief from section 17(a) for,
and the requested relief will not apply to, transactions where a
Fund could be deemed an affiliated person, or an affiliated person
of an affiliated person, of an Investing Fund because an investment
adviser to the Funds is also an investment adviser to an Investing
Fund.
    \19\ Applicants anticipate that most Investing Funds will
purchase Shares in the secondary market and will not purchase
Creation Units directly from a Fund. To the extent purchases and
sales of Shares occur in the secondary market and not through
principal transactions directly between and Investing Fund and a
Fund, relief from section 17(a) would not be necessary. However, the
requested relief would apply to direct sales of Shares in Creation
Units by a Fund to an Investing Fund and redemptions of those
Shares. The requested relief is intended to also cover the in-kind
transactions that would accompany such sales and redemptions.
---------------------------------------------------------------------------

    18. Applicants assert that no useful purpose would be served by
prohibiting such affiliated persons from making in-kind purchases or
in-kind redemptions of Shares of a Fund in Creation Units. Absent the
unusual circumstances discussed in the application, the Deposit
Instruments and Redemption Instruments available for a Fund will be the
same for all purchasers and redeemers, respectively, and will
correspond pro rata to the Fund's Portfolio Instruments. The deposit
procedures for in-kind purchases of Creation Units and the redemption
procedures for in-kind redemptions will be the same for all purchases
and redemptions. Deposit Instruments and Redemption Instruments will be
valued in the same manner as those Portfolio Instruments currently held
by the relevant Funds. Applicants do not believe that in-kind purchases
and redemptions will result in abusive self-dealing or overreaching of
the Fund.
    19. Applicants also submit that the sale of Shares to and
redemption of Shares from an Investing Fund meets the standards for
relief under sections 17(b) and 6(c) of the Act. Applicants note that
any consideration paid for the purchase or redemption of Shares
directly from a Fund will be based on the NAV of the Fund in accordance
with policies and procedures set forth in the Fund's registration
statement.\20\ Applicants also state that the proposed transactions are
consistent with the general purposes of the Act and appropriate in the
public interest.
---------------------------------------------------------------------------

    \20\ Applicants acknowledge that the receipt of compensation by
(a) an affiliated person of an Investing Fund, or an affiliated
person of such person, for the purchase by the Investing Fund of
Shares of the Fund or (b) an affiliated person of a Fund, or an
affiliated person of such person, for the sale by the Fund of its
Shares to an Investing Fund, may be prohibited by section 17(e)(1)
of the Act. The FOF Participation Agreement also will include this
acknowledgment.
---------------------------------------------------------------------------

Applicants' Conditions

    Applicants agree that any order of the Commission granting the
requested relief will be subject to the following conditions:

A. ETF Relief

    1. As long as a Fund operates in reliance on the requested order,
the Shares of the Funds will be listed on a Stock Exchange.
    2. Neither the Trust nor any Fund will be advertised or marketed as
an open-end investment company or a mutual fund. Any advertising
material that describes the purchase or sale of Creation Units or
refers to redeemability will prominently disclose that the Shares are
not individually redeemable and that owners of the Shares may purchase
those Shares from the Fund and tender those Shares for redemption to
the Fund in Creation Units only.
    3. The Web site for each Fund, which is and will be publicly
accessible at no charge, will contain, on a per Share basis for each
Fund: the prior Business Day's NAV and the market closing price or Bid/
Ask Price, and a calculation of the premium or discount of the market
closing price or Bid/Ask Price against such NAV.
    4. On each Business Day, before commencement of trading in Shares
on the listing Stock Exchange, the Fund will disclose on its Web site
the identities and quantities of the Portfolio Instruments held by the
Fund that will form the basis for the Fund's calculation of NAV at the
end of the Business Day.
    5. The Adviser or Fund Sub-Adviser, directly or indirectly, will
not cause any Authorized Participant (or any investor on whose behalf
an Authorized Participant may transact with the Fund) to acquire any
Deposit Instrument for the Fund through a transaction in which the Fund
could not engage directly.
    6. The requested relief to permit ETF operations will expire on the
effective date of any Commission rule under the

Act that provides relief permitting the operation of actively-managed
exchange-traded funds.

B. 12(d)(1) Relief

    1. The members of the Investing Fund's Advisory Group will not
control (individually or in the aggregate) a Fund within the meaning of
section 2(a)(9) of the Act. The members of the Investing Fund's Sub-
Advisory Group will not control (individually or in the aggregate) a
Fund within the meaning of section 2(a)(9) of the Act. If, as a result
of a decrease in the outstanding voting securities of a Fund, the
Investing Fund's Advisory Group or the Investing Fund's Sub-Advisory
Group, each in the aggregate, becomes a holder of more than 25 percent
of the outstanding voting securities of a Fund, it will vote its Shares
of the Fund in the same proportion as the vote of all other holders of
the Fund's Shares. This condition does not apply to the Investing
Fund's Sub-Advisory Group with respect to a Fund for which the Sub-
Adviser or a person controlling, controlled by or under common control
with the Sub-Adviser acts as the investment adviser within the meaning
of section 2(a)(20)(A) of the Act.
    2. No Investing Fund or Investing Fund Affiliate will cause any
existing or potential investment by the Investing Fund in a Fund to
influence the terms of any services or transactions between the
Investing Fund or an Investing Fund Affiliate and the Fund or a Fund
Affiliate.
    3. The board of directors or trustees of an Investing Management
Company, including a majority of the disinterested directors or
trustees, will adopt procedures reasonably designed to assure that the
Investing Fund Adviser and any Sub-Adviser are conducting the
investment program of the Investing Management Company without taking
into account any consideration received by the Investing Management
Company or an Investing Fund Affiliate from a Fund or a Fund Affiliate
in connection with any services or transactions.
    4. Once an investment by an Investing Fund in the Shares exceeds
the limit in section l2(d)(1)(A)(i) of the Act, the Board of a Fund,
including a majority of the disinterested Board members, will determine
that any consideration paid by the Fund to the Investing Fund or an
Investing Fund Affiliate in connection with any services or
transactions: (i) Is fair and reasonable in relation to the nature and
quality of the services and benefits received by the Fund; (ii) is
within the range of consideration that the Fund would be required to
pay to another unaffiliated entity in connection with the same services
or transactions; and (iii) does not involve overreaching on the part of
any person concerned. This condition does not apply with respect to any
services or transactions between a Fund and its investment adviser(s),
or any person controlling, controlled by or under common control with
such investment adviser(s).
    5. The Investing Fund Adviser, or Trustee or Sponsor, as
applicable, will waive fees otherwise payable to it by the Investing
Fund in an amount at least equal to any compensation (including fees
received pursuant to any plan adopted by a Fund under rule 12b-1 under
the Act) received from a Fund by the Investing Fund Adviser, or Trustee
or Sponsor, or an affiliated person of the Investing Fund Adviser, or
Trustee or Sponsor, other than any advisory fees paid to the Investing
Fund Adviser, or Trustee or Sponsor, or its affiliated person by the
Fund, in connection with the investment by the Investing Fund in the
Fund. Any Sub-Adviser will waive fees otherwise payable to the Sub-
Adviser, directly or indirectly, by the Investing Management Company in
an amount at least equal to any compensation received from a Fund by
the Sub-Adviser, or an affiliated person of the Sub-Adviser, other than
any advisory fees paid to the Sub-Adviser or its affiliated person by
the Fund, in connection with the investment by the Investing Management
Company in the Fund made at the direction of the Sub-Adviser. In the
event that the Sub-Adviser waives fees, the benefit of the waiver will
be passed through to the Investing Management Company.
    6. No Investing Fund or Investing Fund Affiliate (except to the
extent it is acting in its capacity as an investment adviser to a Fund)
will cause a Fund to purchase a security in an Affiliated Underwriting.
    7. The Board of the Fund, including a majority of the disinterested
Board members, will adopt procedures reasonably designed to monitor any
purchases of securities by the Fund in an Affiliated Underwriting, once
an investment by an Investing Fund in the securities of the Fund
exceeds the limit of section 12(d)(1)(A)(i) of the Act, including any
purchases made directly from an Underwriting Affiliate. The Board will
review these purchases periodically, but no less frequently than
annually, to determine whether the purchases were influenced by the
investment by the Investing Fund in the Fund. The Board will consider,
among other things: (i) Whether the purchases were consistent with the
investment objectives and policies of the Fund; (ii) how the
performance of securities purchased in an Affiliated Underwriting
compares to the performance of comparable securities purchased during a
comparable period of time in underwritings other than Affiliated
Underwritings or to a benchmark such as a comparable market index; and
(iii) whether the amount of securities purchased by the Fund in
Affiliated Underwritings and the amount purchased directly from an
Underwriting Affiliate have changed significantly from prior years. The
Board will take any appropriate actions based on its review, including,
if appropriate, the institution of procedures designed to ensure that
purchases of securities in Affiliated Underwritings are in the best
interest of shareholders.
    8. Each Fund will maintain and preserve permanently in an easily
accessible place a written copy of the procedures described in the
preceding condition, and any modifications to such procedures, and will
maintain and preserve for a period of not less than six years from the
end of the fiscal year in which any purchase in an Affiliated
Underwriting occurred, the first two years in an easily accessible
place, a written record of each purchase of securities in Affiliated
Underwritings once an investment by an Investing Fund in the securities
of the Fund exceeds the limit of section 12(d)(1)(A)(i) of the Act,
setting forth from whom the securities were acquired, the identity of
the underwriting syndicate's members, the terms of the purchase, and
the information or materials upon which the Board's determinations were
made.
    9. Before investing in a Fund in excess of the limit in section
12(d)(1)(A), an Investing Fund will execute a FOF Participation
Agreement with the Fund stating that their respective boards of
directors or trustees and their investment advisers, or Trustee and
Sponsor, as applicable, understand the terms and conditions of the
order, and agree to fulfill their responsibilities under the order. At
the time of its investment in Shares of a Fund in excess of the limit
in section 12(d)(1)(A)(i), an Investing Fund will notify the Fund of
the investment. At such time, the Investing Fund will also transmit to
the Fund a list of the names of each Investing Fund Affiliate and
Underwriting Affiliate. The Investing Fund will notify the Fund of any
changes to the list as soon as reasonably practicable after a change
occurs. The Fund and the Investing Fund will maintain and preserve a
copy of the order, the FOF Participation Agreement, and the list with
any updated

information for the duration of the investment and for a period of not
less than six years thereafter, the first two years in an easily
accessible place.
    10. Before approving any advisory contract under section 15 of the
Act, the board of directors or trustees of each Investing Management
Company, including a majority of the disinterested directors or
trustees, will find that the advisory fees charged under such contract
are based on services provided that will be in addition to, rather than
duplicative of, the services provided under the advisory contract(s) of
any Fund in which the Investing Management Company may invest. These
findings and their basis will be recorded fully in the minute books of
the appropriate Investing Management Company.
    11. Any sales charges and/or service fees charged with respect to
shares of an Investing Fund will not exceed the limits applicable to a
fund of funds as set forth in NASD Conduct Rule 2830.
    12. No Fund relying on this section 12(d)(1) relief will acquire
securities of any investment company or company relying on section
3(c)(1) or 3(c)(7) of the Act in excess of the limits contained in
section 12(d)(1)(A) of the Act, except to the extent permitted by
exemptive relief from the Commission permitting a Fund to purchase
shares of other investment companies for short-term cash management
purposes.

    For the Commission, by the Division of Investment Management,
under delegated authority.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2012-20264 Filed 8-16-12; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 160 (Monday, August 19, 2019)]
[Rules and Regulations]
[Page 42809]
[FR Doc No: 2019-17740]

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

Coast Guard

33 CFR Part 100

[Docket No. USCG-2019-0543]

Special Local Regulations; Marine Events Within the Fifth Coast
Guard District

AGENCY: Coast Guard, DHS.

ACTION: Notice of enforcement of regulation.

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

SUMMARY: The Coast Guard will enforce the special local regulation for
the Thunder Over the Boardwalk Air Show on August 20 and August 21,
2019, from 10:30 a.m. through 4:30 p.m., to provide for the safety of
life on navigable waterways during this event. Our regulation for
marine events within the Fifth Coast Guard District identifies the
regulated area for this event in Atlantic City, NJ. During the
enforcement periods, the operator of any vessel in the regulated area
must comply with directions from the Patrol Commander or any Official
Patrol displaying a Coast Guard ensign.

DATES: The regulation in 33 CFR 100.501 for the special local
regulation listed in item (a)(8) in the table to Sec.  100.501 will be
enforced from 10:30 a.m. through 4:30 p.m. on each of the following
dates: August 20, 2019, and August 21, 2019.

FOR FURTHER INFORMATION CONTACT: If you have questions about this
notice of enforcement, you may call or email Petty Officer Thomas
Welker, U.S. Coast Guard, Sector Delaware Bay, Waterways Management
Division, telephone<PHONE_NUMBER>, email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: The Coast Guard will enforce the special
regulations as described in section (a), row (8) of the table to in 33
CFR 100.501 for the Thunder Over the Boardwalk Air Show from 10:30 a.m.
to 4:30 p.m. on August 20 and August 21, 2019. The published
enforcement periods for this event include the 3rd Tuesday and
Wednesday in August. Because an additional air show practice over these
same waters is scheduled for Monday, August 19, 2019, and poses similar
hazards to safety of life, we are also issuing a separate special local
regulation from 10:30 a.m. to 4:30 p.m. on that day as well. For more
information on that rulemaking, go to https://www.regulations.gov, type
USCG-2019-0644 in the ``Search'' box and click ``Search.'' These
actions are being taken to provide for the safety of life on navigable
waterways during this 3-day event. Our regulation for marine events
within the Fifth Coast Guard District, table to Sec.  100.501, section
(a), row (8), specifies the location of the regulated area as all
waters of the North Atlantic Ocean, adjacent to Atlantic City, New
Jersey, bounded by a line drawn between the following points: From a
point along the shoreline at latitude 39[deg]21'31'' N, longitude
074[deg]25'04'' W, thence southeasterly to latitude 39[deg]21'08'' N,
longitude 074[deg]24'48'' W, thence southwesterly to latitude
39[deg]20'16'' N, longitude 074[deg]27'17'' W, thence northwesterly to
a point along the shoreline at latitude 39[deg]20'44'' N, longitude
074[deg]27'31'' W, thence northeasterly along the shoreline to latitude
39[deg]21'31'' N, longitude 074[deg]25'04'' W.
    During the enforcement periods, as reflected in Sec.  100.100(c),
if you are the operator of a vessel in the regulated area you must
comply with directions from the Patrol Commander or any Official Patrol
displaying a Coast Guard ensign.
    In add addition to this notice of enforcement in the Federal
Register, the Coast Guard will provide notification of the enforcement
periods via broadcast notice to mariners.

    Dated: August 13, 2019.
Scott E. Anderson,
Captain, U.S. Coast Guard, Captain of the Port, Delaware Bay.
[FR Doc. 2019-17740 Filed 8-16-19; 8:45 am]
BILLING CODE 9110-04-P


[Federal Register: August 13, 2007 (Volume 72, Number 155)]
[Rules and Regulations]
[Page 45153-45156]
[DOCID:fr13au07-4]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2007-28478; Directorate Identifier 2007-CE-057-AD;
Amendment 39-15153; AD 2007-16-14]
RIN 2120-AA64

Airworthiness Directives; Taylorcraft A, B, and F Series
Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule; request for comments.

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

SUMMARY: The FAA is adopting a new airworthiness directive (AD) for all
Taylorcraft A, B, and F series airplanes. This AD requires you to
initially inspect the left and right wing front and aft lift struts for
corrosion and cracks, replace any cracked strut or strut with corrosion
that exceeds certain limits with either sealed or non-sealed struts,
and repetitively inspect any non-sealed struts. This AD results from
inspections

where several different struts were found with moderate to severe
corrosion and required strut replacement. We are issuing this AD to
detect and correct corrosion or cracks in the right and left wing front
and aft lift struts. This condition, if not corrected, could result in
failure of the lift strut and lead to in-flight separation of the wing
with consequent loss of control.

DATES: This AD becomes effective on August 20, 2007.
    On August 20, 2007, the Director of the Federal Register approved
the incorporation by reference of certain publications listed in this
AD.
    We must receive any comments on this AD by October 12, 2007.

ADDRESSES: Use one of the following addresses to comment on this AD.
     DOT Docket Web site: Go to http://dms.dot.gov and follow

the instructions for sending your comments electronically.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue, SE., Washington, DC 20590.
     Fax:<PHONE_NUMBER>.
     Hand Delivery: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays.
     Federal eRulemaking Portal: Go to http://www.regulations.gov.
 Follow the instructions for submitting comments.

    To get the service information identified in this AD, contact
Taylorcraft Aviation, LLC, 2124 North Central Avenue, Brownsville,
Texas 78521; telephone:<PHONE_NUMBER>.
    To view the comments to this AD, go to http://dms.dot.gov. The

docket number is FAA-2007-28478; Directorate Identifier 2007-CE-057-AD.

FOR FURTHER INFORMATION CONTACT: Andrew McAnaul, Aerospace Engineer,
ASW-150 (c/o MIDO-43), 10100 Reunion Place, Suite 650, San Antonio,
Texas 78216; telephone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Discussion

    The FAA has received reports of several corroded wing lift struts
from different Taylorcraft series airplanes. Independent laboratory
analysis of the struts revealed varying degrees of excessive internal
and external corrosion, including through-the-thickness corrosion. The
struts exhibited corrosion severe enough to require strut replacement.
Additional Taylorcraft owners reported finding severe corrosion on wing
struts during routine maintenance, which required strut replacement.
These same findings confirm strut corrosion Taylorcraft reported to the
FAA. The internal cavity of the original design (vented) lift struts is
exposed to the external environment and can hide internal surface
corrosion resulting from environmental exposure. External surface
corrosion can be masked by the external paint coating.
    This condition, if not corrected, could result in failure of a wing
lift strut due to corrosion and lead to separation of the wing from the
airplane with consequent loss of control.

Relevant Service Information

    We reviewed Taylorcraft Aviation, LLC Service Bulletin (SB) No.
2007-001, Revision A, dated August 1, 2007. The service information
describes procedures for wing lift strut assembly corrosion inspection
and/or replacement.

FAA's Determination and Requirements of This AD

    We are issuing this AD because we evaluated all the information and
determined the unsafe condition described previously is likely to exist
or develop on other products of the same type design. This AD requires
you to initially inspect the left and right wing front and aft lift
struts for corrosion and cracks, replace any cracked strut or strut
with corrosion that exceeds certain limits with either sealed or non-
sealed struts, and repetitively inspect any non-sealed struts.
    The FAA is determining whether future rulemaking action is
necessary. This could include inspection and/or modification or
replacement in adjacent structure.
    In preparing this rule, we contacted type clubs and aircraft
operators to get technical information and information on operational
and economic impacts. We have included a discussion of information that
may have influenced this action in the rulemaking docket.

FAA's Determination of the Effective Date

    An unsafe condition exists that requires the immediate adoption of
this AD. The FAA has found that the risk to the flying public justifies
waiving notice and comment prior to adoption of this rule because
corrosion and/or cracks in the wing lift struts could result in
separation of the wing from the airplane with consequent loss of
control. Therefore, we determined that notice and opportunity for
public comment before issuing this AD are impracticable and that good
cause exists for making this amendment effective in fewer than 30 days.

Comments Invited

    This AD is a final rule that involves requirements affecting flight
safety, and we did not precede it by notice and an opportunity for
public comment. We invite you to send any written relevant data, views,
or arguments regarding this AD. Send your comments to an address listed
under the ADDRESSES section. Include the docket number ``FAA-2007-
28478; Directorate Identifier 2007-CE-057-AD'' at the beginning of your
comments. We specifically invite comments on the overall regulatory,
economic, environmental, and energy aspects of the AD. We will consider
all comments received by the closing date and may amend the AD in light
of those comments.
    We will post all comments we receive, without change, to http://dms.dot.gov
, including any personal information you provide. We will

also post a report summarizing each substantive verbal contact we
receive concerning this AD.

Authority for This Rulemaking

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

Regulatory Findings

    We determined that this 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); and
    (3) Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.
    We prepared a regulatory evaluation of the estimated costs to
comply with this AD and placed it in the AD docket.

Examining the AD Docket

    You may examine the AD docket that contains the AD, the regulatory
evaluation, any comments received, and other information on the
Internet at http://dms.dot.gov; or in person at the Docket Management

Facility between 9 a.m. and 5 p.m., Monday through Friday, except
Federal holidays. The Docket Office (telephone<PHONE_NUMBER>) is
located at the street address stated in the ADDRESSES section. Comments
will be available in the AD docket shortly after receipt.

List of Subjects in 14 CFR Part 39

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

Adoption of the Amendment

0
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):

2007-16-14 Taylorcraft: Amendment 39-15153; Docket No. FAA-2007-
28478; Directorate Identifier 2007-CE-057-AD.

Effective Date

    (a) This AD becomes effective on August 20, 2007.

Affected ADs

    (b) None.

Applicability

    (c) This AD applies to all serial numbers of Taylorcraft Models
A, BC, BCS, BC-65, BCS-65, BC12-65 (Army L-2H), BCS12-65, BC12-D,
BCS12-D, BC12-D1, BCS12-D1, BC12D-85, BCS12D-85, BC12D-4-85, BCS12D-
4-85, (Army L-2G) BF, BFS, BF-60, BFS-60, BF-65, BFS-65, (Army L-2K)
BF 12-65, BL, BLS, (Army L-2F) BL-65, BLS-65, (Army L-2J) BL12-65,
BLS12-65, FA-III (Airphibian), 19, F19, F21, F21A, F21B, F22, F22A,
F22B, F22C, and TG-6 Conversion airplanes that:
    (1) Are certificated in any category; and
    (2) Do not incorporate in all struts new sealed front lift
struts (P/N MA-A815 or FAA-approved equivalent P/N) and new sealed
aft lift struts (P/N MA-A854 or FAA-approved equivalent P/N).

    Note: This AD applies to all Taylorcraft models listed above,
including those not listed in Taylorcraft Aviation, LLC Service
Bulletin No. 2007-001, Revision A, dated August 1, 2007. If there
are any other differences between this AD and the above service
bulletin, this AD takes precedence.

Unsafe Condition

    (d) This AD results from inspections where several different
struts were found with moderate to severe corrosion and required
strut replacement. We are issuing this AD to detect and correct
corrosion or cracks in the right and left wing front and aft lift
struts, which could result in failure of the lift strut and lead to
in-flight separation of the wing with consequent loss of control.

Compliance

    (e) To address this problem, you must do the following, unless
already done:

----------------------------------------------------------------------------------------------------------------
               Actions                             Compliance                            Procedures
----------------------------------------------------------------------------------------------------------------
(1) Visual Inspection: Visually       Within the next 5 hours time-in-      Follow Part 1 of the Instructions in
 inspect for corrosion or cracking     service after August 20, 2007 (the    Taylorcraft Aviation, LLC Service
 in the lower 12 inches of the left    effective date of this AD), unless    Bulletin No. 2007-001, Revision A,
 and right wing front lift struts      the strut has:                        dated August 1, 2007.
 (part number (P/N) A-A815 or FAA-    (i) Been replaced with parts
 approved equivalent P/N) and aft      specified in either paragraph
 lift struts (P/N A-A854 or FAA-       (e)(4)(i); or
 approved equivalent P/N) and then    (ii) Been replaced with parts
 inspect per paragraph (e)(2) of       specified by paragraph (e)(4)(ii)
 this AD.                              of this AD and been installed on an
                                       airplane for less than 24 months.
(2) Initial Eddy Current or           Initially inspect any original        Follow Part 2 of the Instructions in
 Ultrasound Inspection: Inspect        design (vented) strut or FAA-         Taylorcraft Aviation, LLC Service
 using the eddy current or             approved equivalent part number at    Bulletin No. 2007-001, Revision A,
 ultrasound inspection methods to      whichever of the following that       dated August 1, 2007.
 detect corrosion or cracking in the   applies:
 lower 12 inches of the left and      (A) Before further flight when
 right wing front lift struts (P/N A-  corrosion or cracking is found
 A815 or FAA-approved equivalent P/    during the visual inspection
 N) and aft lift struts (P/N A-A854    required in paragraph (e)(1) of
 or FAA-approved equivalent P/N).      this AD; or
 The eddy current or ultrasound       (B) If no corrosion or cracking is
 inspection must be done by one of     found during the visual inspection
 the following:                        in paragraph (e)(1) of this AD,
(i) A Level II or III inspector        within the next 3 months after
 certified in the applicable eddy      August 20, 2007 (the effective date
 current or ultrasound inspection      of this AD) or within 24 months of
 method using the guidelines           installation of the strut,
 established by the American Society   whichever occurs later.
 of Nondestructive Testing or NAS
 410 (formerly MIL-STD-410);
(ii) An inspector certified to
 specific FAA or other acceptable
 government or industry standards,
 such as Air Transport Association
 (ATA) Specifications 105--
 Guidelines for Training and
 Qualifying Personnel in
 Nondestructive Testing Methods; or
(iii) A qualified FAA Repair Station
 or a qualified Testing/Inspection
 Laboratory.

(3) Repetitive Eddy Current or        (A) For original or replacement left  Follow Part 2 of the Instructions in
 Ultrasound Inspections: Inspect       and right wing front lift struts (P/  Taylorcraft Aviation, LLC Service
 using the eddy current or             N A-A815 or FAA-approved equivalent   Bulletin No. 2007-001, Revision A,
 ultrasound inspection methods to      P/N) and aft lift struts (P/N A-      dated August 1, 2007.
 detect corrosion or cracking in the   A854 or FAA-approved equivalent P/
 lower 12 inches of the left and       N) of original design (vented),
 right wing front lift struts (P/N A-  repetitively inspect at intervals
 A815 or FAA-approved equivalent P/    not to exceed 24 months after the
 N) and aft lift struts (P/N A-A854    initial inspection required in
 or FAA-approved equivalent P/N).      paragraph (e)(2) of this AD.
 The eddy current or ultrasound       (B) Replacement of all struts with
 inspection must be done by one of     new sealed front lift struts (P/N
 the following:                        MA-A815 or FAA-approved equivalent
(i) A Level II or III inspector        P/N) and new sealed aft lift struts
 certified in the applicable Eddy      (P/N MA-A854 or FAA-approved
 Current or Ultrasound Inspection      equivalent P/N) eliminates the
 method using the guidelines           repetitive inspection requirement
 established by the American Society   of this AD.
 of Nondestructive Testing or NAS     (C) If not all the vented lift
 410 (formerly MIL-STD-410),           struts are replaced with new sealed
(ii) An Inspector certified to         units, then the lift struts that
 specific FAA or other acceptable      are not new sealed units are still
 government or industry standards,     subject to the repetitive
 such as Air Transport Association     inspection requirement of this AD.
 (ATA) Specifications 105--
 Guidelines for Training and
 Qualifying Personnel in
 Nondestructive Testing Methods, or
(iii) A qualified FAA Repair Station
 or a qualified Testing/Inspection
 Laboratory.
(4) Replacement: Replace the          Replace before further flight any     Follow Taylorcraft Aviation, LLC
 original design (vented) front lift   time cracking or corrosion is found   Service Bulletin No. 2007-001,
 struts (P/N A-A815 or FAA-approved    during any required eddy current or   Revision A, dated August 1, 2007.
 equivalent P/N) and original design   ultrasound inspection that exceeds
 (vented) aft lift struts (P/N A-      the acceptance/rejection criteria
 A854 or FAA-approved equivalent P/    limits in Taylorcraft Aviation, LLC
 N) with one of the following:         Service Bulletin No. 2007-001,
(i) new sealed front lift struts, (P/  Revision A, dated August 1, 2007.
 N MA-A815 or FAA-approved             After replacing with an original
 equivalent P/N) and new sealed aft    design (vented) strut, begin the
 lift struts, (P/N MA-A854 or FAA-     repetitive inspections of paragraph
 approved equivalent P/N); or          (e)(3) within 24 months after
(ii) New original design (vented)      installation.
 front lift struts (P/N A-815 or FAA-
 approved equivalent P/N) and new
 original design (vented) aft lift
 struts (P/N A-A854 or FAA-approved
 equivalent P/N).
----------------------------------------------------------------------------------------------------------------

Alternative Methods of Compliance (AMOCs)

    (f) The Manager, Fort Worth Airplane Certification Office, FAA,
has the authority to approve AMOCs for this AD, if requested using
the procedures found in 14 CFR 39.19. Send information to ATTN:
Andrew McAnaul, Aerospace Engineer, ASW-150 (c/o MIDO-43), 10100
Reunion Place, Suite 650, San Antonio, Texas 78216; telephone: (210)
308-3365; fax:<PHONE_NUMBER>. Before using any approved AMOC on any
airplane to which the AMOC applies, notify your appropriate
principal inspector (PI) in the FAA Flight Standards District Office
(FSDO), or lacking a PI, your local FSDO.

Material Incorporated by Reference

    (g) You must use Taylorcraft Aviation, LLC Service Bulletin No.
2007-001, Revision A, dated August 1, 2007, to do the actions
required by this AD, unless the AD specifies otherwise.
    (1) The Director of the Federal Register approved the
incorporation by reference of this service information under 5
U.S.C. 552(a) and 1 CFR part 51.
    (2) For service information identified in this AD, contact
Taylorcraft Aviation, LLC, 2124 North Central Avenue, Brownsville,
Texas 78521; telephone:<PHONE_NUMBER>.
    (3) You may review copies at the FAA, Central Region, Office of
the Regional Counsel, 901 Locust, Kansas City, Missouri 64106; or at
the National Archives and Records Administration (NARA). For
information on the availability of this material at NARA, call 202-
741-6030, or go to: http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html
.

    Issued in Kansas City, Missouri, on August 3, 2007.
David R. Showers,
Acting Manager, Small Airplane Directorate, Aircraft Certification
Service.
 [FR Doc. E7-15581 Filed 8-10-07; 8:45 am]

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