[Federal Register Volume 76, Number 175 (Friday, September 9, 2011)]
[Notices]
[Pages 55989-55995]
[FR Doc No: 2011-23103]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-65263; File No. SR-MSRB-2011-09]

Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Notice of Filing of Proposed Rule Change Consisting of Proposed
Interpretive Notice Concerning the Application of MSRB Rule G-17, on
Conduct of Municipal Securities and Municipal Advisory Activities, to
Underwriters of Municipal Securities

September 6, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is
hereby given that on August 22, 2011, the Municipal Securities
Rulemaking Board (``Board'' or ``MSRB'') filed with the Securities and
Exchange Commission (``SEC'' or ``Commission'') the proposed rule
change as described in Items I, II, and III below, which Items have
been prepared by the MSRB. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The MSRB is filing with the SEC a proposed rule change consisting
of a proposed interpretive notice (the ``Notice'') concerning the
application of MSRB Rule G-17 (on conduct of municipal securities and
municipal advisory activities) to underwriters of municipal securities.
The MSRB requests that the proposed rule change be made effective 90
days after approval by the Commission.
    The text of the proposed rule change is available on the MSRB's Web
site at http://www.msrb.org/Rules-and-Interpretations/SEC-Filings/2011-Filings.aspx, at the MSRB's principal office, and at the Commission's
Public Reference Room.

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

    In its filing with the Commission, the MSRB included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Board has prepared summaries, set forth in Sections
A, B, and C below, of the most significant aspects of such statements.

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

1. Purpose
    (a) With the passage of the Dodd-Frank Act, the MSRB was expressly
directed by Congress to protect municipal entities. Accordingly, the
MSRB is proposing to provide additional interpretive guidance that
addresses how Rule G-17 applies to dealers in the municipal securities
activities described below.
    A more-detailed description of the provisions of the Notice
follows:
    Representations to Issuers. The Notice would provide that all
representations made by underwriters to issuers of municipal securities
in connection with municipal securities underwritings (e.g., issue
price certificates and responses to requests for proposals), whether
written or oral, must be truthful and accurate and may not misrepresent
or omit material facts.
    Required Disclosures to Issuers. The Notice would provide that an
underwriter of a negotiated issue that recommends a complex municipal
securities transaction or product (e.g., a variable rate demand
obligation with a swap) to an issuer has an obligation under Rule G-17
to disclose all material risks (e.g., in the case of a swap, market,
credit, operational, and liquidity risks), characteristics, incentives,
and conflicts of interest (e.g., payments received from a swap
provider) regarding the transaction or product. Such disclosure would
be required to be sufficient to allow the issuer to assess the
magnitude of its potential exposure as a result of the complex
municipal securities financing. In the case of routine financing
structures, underwriters would be required to disclose the material
aspects of the structures if the issuers did not otherwise have
knowledge or experience with respect to such structures.

    The disclosures would be required to be made in writing to an
official of the issuer whom the underwriter reasonably believed had the
authority to bind the issuer by contract with the underwriter (i) In
sufficient time before the execution of a contract with the underwriter
to allow the official to evaluate the recommendation and (ii) in a
manner designed to make clear to such official the subject matter of
such disclosures and their implications for the issuer. If the
underwriter did not reasonably believe that the official to whom the
disclosures were addressed was capable of independently evaluating the
disclosures, the underwriter would be required to make additional
efforts reasonably designed to inform the official or its employees or
agent.\3\
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    \3\ Section 4s(h)(5) of the Commodity Exchange Act requires that
a swap dealer with a special entity client (including states, local
governments, and public pension funds) must have a reasonable basis
to believe that the special entity has an independent representative
that has sufficient knowledge to evaluate the transaction and its
risks, as well as the pricing and appropriateness of the
transaction. Section 15F(h)(5) of the Exchange Act imposes the same
requirements with respect to security-based swaps.
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    Underwriter Duties in Connection with Issuer Disclosure Documents.
The Notice would provide that a dealer's duty to have a reasonable
basis for the representations it makes, and other material information
it provides, to an issuer and to ensure that such representations and
information are accurate and not misleading, as described above,
extends to representations and information provided by the underwriter
in connection with the preparation by the issuer of its disclosure
documents (e.g., cash flows).
    New Issue Pricing and Underwriter Compensation. The Notice would
provide that the duty of fair dealing under Rule G-17 includes an
implied representation that the price an underwriter pays to an issuer
is fair and reasonable, taking into consideration all relevant factors,
including the best judgment of the underwriter as to the fair market
value of the issue at the time it is priced. The Notice distinguishes
the fair pricing duties of competitive underwriters (submission of bona
fide bid based on dealer's best judgment of fair market value of
securities) and negotiated underwriters (duty to negotiate in good
faith). The Notice would provide that, in certain cases and depending
upon the specific facts and circumstances of the offering, the
underwriter's compensation for the new issue (including both direct
compensation paid by the issuer and other separate payments or credits
received by the underwriter from the issuer or any other party in
connection with the underwriting) may be so disproportionate to the
nature of the underwriting and related services performed, as to
constitute an unfair practice that is a violation of Rule G-17.
    Conflicts of Interest. The Notice would require disclosure by an
underwriter of potential conflicts of interest, including third-party
payments, values, or credits made or received, profit-sharing
arrangements with investors, and the issuance or purchase of credit
default swaps for which the underlying reference is the issuer whose
securities the dealer is underwriting or an obligation of that issuer.
    Retail Order Periods. The Notice would remind underwriters not to
disregard the issuers' rules for retail order periods by, among other
things, accepting or placing orders that do not satisfy issuers'
definitions of ``retail.''
    Dealer Payments to Issuers. Finally, the Notice would remind
underwriters that certain lavish gifts and entertainment, such as those
made in conjunction with rating agency trips, might be a violation of
Rule G-17, as well as Rule G-20.
    (b) The MSRB believes that the proposed rule change is consistent
with Section 15B(b)(2) of the Exchange Act, which provides that:

    The Board shall propose and adopt rules to effect the purposes
of this title with respect to transactions in municipal securities
effected by brokers, dealers, and municipal securities dealers and
advice provided to or on behalf of municipal entities or obligated
persons by brokers, dealers, municipal securities dealers, and
municipal advisors with respect to municipal financial products, the
issuance of municipal securities, and solicitations of municipal
entities or obligated persons undertaken by brokers, dealers,
municipal securities dealers, and municipal advisors.
    Section 15B(b)(2)(C) of the Exchange Act, provides that the
rules of the MSRB shall: be designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
municipal securities and municipal financial products, to remove
impediments to and perfect the mechanism of a free and open market
in municipal securities and municipal financial products, and, in
general, to protect investors, municipal entities, obligated
persons, and the public interest.

    The proposed rule change is consistent with Section 15B(b)(2) of
the Exchange Act because it will protect issuers of municipal
securities from fraudulent and manipulative acts and practices and
promote just and equitable principles of trade, while still emphasizing
the duty of fair dealing owed by underwriters to their customers. Rule
G-17 has two components, one an anti-fraud prohibition, and the other a
fair dealing requirement (which promotes just and equitable principles
of trade). The Notice would address both components of the rule. The
sections of the Notice entitled ``Representations to Issuers,''
``Underwriter Duties in Connection with Issuer Disclosure Documents,''
``Excessive Compensation,'' ``Payments to or from Third Parties,''
``Profit-Sharing with Investors,'' ``Retail Order Periods,'' and
``Dealer Payments to Issuer Personnel'' primarily would provide
guidance as to conduct required to comply with the anti-fraud component
of the rule and, in some cases, conduct that would violate the anti-
fraud component of the rule, depending on the facts and circumstances.
The sections of the Notice entitled ``Required Disclosures to
Issuers,'' ``Fair Pricing,'' and ``Credit Default Swaps'' primarily
would provide guidance as to conduct required to comply with the fair
dealing component of the rule.

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

    The MSRB does not believe that the proposed rule change would
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Exchange Act, since it would apply
equally to all underwriters of municipal securities.

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

    On February 14, 2011, the MSRB requested comment on the proposed
rule change.\4\ The MSRB received 5 comment letters. Comment letters
were received from the American Federation of State, County and
Municipal Employees (``AFSCME''); the Bond Dealers of America
(``BDA''); Municipal Regulatory Consulting LLC (``MRC''); the National
Association of Independent Public Finance Advisors (``NAIPFA''); and
the Securities Industry and Financial Markets Association (``SIFMA'').
The comments are summarized according to the subject headings of the
Notice.
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    \4\ See MSRB Notice 2011-12 (February 14, 2011).

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Representations to Issuers
     Comments: Reasonable Basis for Certificates. SIFMA said
that the MSRB should reconsider the requirement for an underwriter to
have a reasonable basis for the representations and material
information in certificates it provides, arguing that other regulatory
requirements (e.g., IRC Section 6700 and wire fraud statutes) already
govern such representations. It said that the MSRB should, at least,
confirm that an underwriter would meet this obligation when it verifies
the information in the certificate against the official books of the
issuer and any other factual information within the underwriter's
control.
    MSRB Response: The MSRB has determined to make no change to this
requirement of the Notice and notes that the ``reasonable basis''
requirement of the Notice in the context of certificates provided by an
underwriter is consistent with the view of the Commission that the
underwriter must have a reasonable basis for belief in the truthfulness
and completeness of the key representations made in any disclosure
documents used in an offering of municipal securities. See endnote 10
to the Notice. It is also consistent with Internal Revenue Service
interpretations of Section 6700 of the Internal Revenue Code, which
address the application of the penalty to statements (including
underwriter certificates) material to tax exemption that the maker knew
or had ``reason to know'' were false or fraudulent, such as the one
cited in note 9 to SIFMA's comment letter. Therefore, the Notice
imposes no additional requirement upon underwriters. Review of the
official books of the issuer and other factual information within the
underwriter's control may assist the underwriter in forming a
reasonable basis for its certificate. However, if the certificate
relies on the representations of others or facts not within the
underwriter's control, additional due diligence on the part of the
underwriter may be required. The MSRB notes that a quote from the
Internal Revenue Service publication cited in SIFMA's letter provides
some useful guidance on the level of inquiry required: ``Participants
[in a bond financing] can rely on matters of fact or material provided
by other participants necessary to make their own statements or draw
their own conclusions, unless they have actual knowledge or a reason to
know of its inaccuracy or the statement is not credible or reasonable
on its face.'' The Internal Revenue Service summarized the legislative
history of Section 6700. See H. Conf. Rep. No. 101-247, 101st Cong.,
1st Sess. 1397.
Required Disclosures to Issuers
     Comments: Complex Financings. SIFMA argued that more
guidance is needed on the complex municipal securities financings
requirements.
    [cir] It said that a transaction should only be deemed complex if
the municipal issuer informed the underwriter that the issuer had never
engaged in the type of transaction before and therefore might not
understand the transaction's material risks and characteristics.
    [cir] It also said that the MSRB should provide more guidance and
definition with regard to what types of transactions will be considered
``complex,'' arguing that references to ``external index not typically
used in the municipal securities market'' and ``atypical or complex
arrangements'' were vague.
    [cir] It also said that issuers that required an analysis of the
risks and characteristics of a transaction should hire independent
advisors or separately contract for this service with their
underwriters.
    MSRB Response: In response to SIFMA's first comment above, the MSRB
has added the following language to the Notice: ``The level of
disclosure required may vary according to the issuer's knowledge or
experience with the proposed financing structure or similar structures,
capability of evaluating the risks of the recommended financing, and
financial ability to bear the risks of the recommended financing, in
each case based on the reasonable belief of the underwriter.'' This
language is based on the suitability analysis required by the Financial
Industry Regulatory Authority (``FINRA'') of dealers selling complex
products, such as options and securities futures,\5\ although the
Notice does not go so far as to impose a suitability requirement on
underwriters of municipal securities with respect to issuers.\6\ The
MSRB notes that this language applies only to disclosures concerning
material terms and characteristics of a complex municipal securities
financing. The Notice also provides: ``In all events, the underwriter
must disclose any incentives for the underwriter to recommend the
complex municipal securities financing and other associated conflicts
of interest.'' The MSRB does not agree with SIFMA that an issuer should
be required to exercise its supposed ``bargaining power'' in order to
receive such disclosures.
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    \5\ FINRA Rules 2360 and 2370.
    \6\ The Notice does not address whether engaging in any of the
activities described in the Notice would cause a dealer to be
considered a ``municipal advisor'' under the Exchange Act and the
rules promulgated thereunder and, therefore, subject to a fiduciary
duty. The MSRB notes that dealers that recommend swaps or security-
based swaps to municipal entities may also be subject to rules of
the Commodity Futures Trading Commission or those of the SEC. See,
e.g., Federal Register Vol. 75, No. 245 (December 22, 2010) and
Federal Register Vol. 76, No. 137 (July 18, 2011).
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    In response to SIFMA's second comment above, the Notice does
provide examples of complex municipal securities financings: ``variable
rate demand obligations (``VRDOs'') and financings involving
derivatives (such as swaps).'' In response to SIFMA's comment, the
Notice now also distinguishes those examples from: ``The typical fixed
rate offering.'' It also now provides that: ``Even a financing in which
the interest rate is benchmarked to an index that is commonly used in
the municipal marketplace (e.g., LIBOR or SIFMA) may be complex to an
issuer that does not understand the components of that index or its
possible interaction with other indexes.''
    With regard to SIFMA's third comment, while the MSRB agrees that an
issuer seeking an independent assessment of the risks and
characteristics of a transaction recommended by an underwriter may wish
to hire a separate municipal advisor for that purpose, at its own
election, the MSRB is firmly of the view that basic principles of fair
dealing require an underwriter to disclose the risks and
characteristics of a complex municipal securities financing that it has
itself determined to recommend to the issuer.
    The MSRB notes that the Notice has been amended to provide that, in
the case of routine financing structures, underwriters would be
required to disclose the material aspects of the structures if the
issuers did not otherwise have knowledge or experience with respect to
such structures.
     Comments: Recommendations. NAIPFA argued that underwriters
should also be required--in the same manner and to the same extent as
advisors would be required--to have a reasonable basis for any
recommendation they made and to disclose material risks about the
course of conduct they recommend, along with the risks and potential
benefits of reasonable alternatives then available in the market. SIFMA
said that the MSRB should clarify whether a dealer's recommendation of
a swap will subject it to a fiduciary duty. MRC said that the
requirements for disclosures in the

context of complex municipal securities financings should be set forth
in Rule G-19.
    MSRB Response: The MSRB has determined not to impose a suitability
duty in this context at this time. The Notice also does not address
whether the provision of advice by underwriters will cause them to be
considered municipal advisors under the Exchange Act and, accordingly,
subject to a fiduciary duty. In the view of the MSRB, the duty of fair
dealing is subsumed within a fiduciary duty, so additional duties may
apply to the provision of advice by underwriters that the Commission
considers to be municipal advisory activities. See also footnote 6
herein.
     Comments: Recipients of Disclosures. BDA and SIFMA said
that an underwriter should only need to have a reasonable belief that
it was making required disclosures to officials with the authority to
bind the issuer, particularly if the official represented that he/she
has such authority.
    MSRB Response: The MSRB agrees with this comment and has revised
the Notice accordingly.
     Comments: Timing of Disclosures. SIFMA said that the MSRB
should clarify that disclosures should only be required once. It said
that, as an example, a representation in a response to an RFP or
otherwise before the underwriter is engaged should suffice.
    MSRB Response: The Notice does not require disclosures to be made
more than once per issue. An RFP response could be an appropriate place
to make required disclosures as long as the proposed structure of the
financing is adequately developed at that point to permit the
disclosures required by the Notice.
Underwriter Duties in Connection With Issuer Disclosure Documents
     Comments: Reasonable Basis for Official Statement
Materials. SIFMA argued that an underwriter should not be required to
have a reasonable basis for the representations it makes, or other
material information it provides in connection with the preparation by
the issuer of its disclosure documents. Instead, SIFMA argued that the
MSRB should permit an underwriter to agree with an issuer that the
underwriter will only be responsible for materials furnished to an
issuer if the underwriter has (i) Consented, in writing, to such
materials being used in offering documents and (ii) agreed with the
issuer that the underwriter and not the issuer will assume
responsibility for the accuracy and proper presentation of such
material. SIFMA said that an underwriter should be able to limit its
responsibility for information provided by disclosing to the issuer any
limitations on the scope of its analysis and factual verification it
performed. Furthermore, it argued that any duty should extend only to
material information provided by the underwriter and not to all
information and analysis, suggesting that an underwriter should not
have to verify the assumptions and facts that underlie cash flows it
prepared.
    MSRB Response: The MSRB does not agree with this comment and
reminds SIFMA of the view of the SEC as summarized in endnote 9 to the
Notice: With respect to primary offerings of municipal securities, the
SEC has noted, ``By participating in an offering, an underwriter makes
an implied recommendation about the securities.'' See SEC Rel. No. 34-
26100 (Sept. 22, 1988) (proposing Exchange Act Rule 15c2-12) at text
following note 70 (the ``1988 Proposing Release''). The SEC stated in
the 1988 Proposing Release that ``this recommendation itself implies
that the underwriter has a reasonable basis for belief in the
truthfulness and completeness of the key representations made in any
disclosure documents used in the offerings.'' It would seem a curious
result, therefore, for the underwriter not to be required under Rule G-
17 to have a reasonable basis for its own representations set forth in
the official statement, as well as a reasonable basis for the material
information it provides to the issuer in connection with the
preparation of the official statement, including a reasonable belief in
the truthfulness and completeness of any information provided by others
that serves as a material basis for such underwriter's information.
Underwriter Compensation and New Issue Pricing
     Comments: Fair Pricing. BDA said that the fair pricing
obligation in the context of a new issue should employ a good faith
standard. It said that there is no prevailing market price for new
issues and that comparisons to secondary market trades are difficult
because of the infrequency of trades and the differences among issuers.
Similarly, SIFMA said that an underwriter should only be required to
purchase securities at the price that it and the issuer negotiated and
agreed to in good faith, without regard to a prevailing market price,
which it said does not exist for new issue securities. It said that the
MSRB's proposal will encourage increased reliance on credit ratings,
which it characterized as contrary to the intent of Dodd-Frank and SEC
policy guidance.
    MSRB Response: In response to this comment, the MSRB has amended
the Notice to remove references to prevailing market price. Consistent
with SIFMA's observation that many underwriters already make
representations as to the fair market price of new issues in tax
certificates to issuers, the Notice now reads: ``The duty of fair
dealing under Rule G-17 includes an implied representation that the
price an underwriter pays to an issuer is fair and reasonable, taking
into consideration all relevant factors, including the best judgment of
the underwriter as to the fair market value of the issue at the time it
is priced.''
Conflicts of Interest
     Comments: Conflicts Disclosure. NAIPFA argued that
underwriters should be required to comply with all the rules regarding
conflicts to which municipal advisors would be subject under Rule G-17.
Specifically, NAIPFA said that underwriters should be required to
disclose with respect to all issues that they:
    [cir] Are not acting as advisors but as underwriters;
    [cir] Are not fiduciaries to the issuer but rather counterparties
dealing at arm's-length;
    [cir] Have conflicts with issuers because they represent the
interests of the investors or other counterparties, which may result in
benefits to other transaction participants at direct cost to the
issuer;
    [cir] Seek to maximize their profitability and such profitability
may or may not be transparent or disclosed to the issuer; and
    [cir] Have no continuing obligation to the issuer following the
closing of transactions.

On the other hand, SIFMA argued that the Notice would impose a
``fiduciary-lite'' duty on underwriters, citing as examples the
disclosures required of underwriters recommending complex municipal
securities financings and the required disclosures of business
relationships and methods of doing business, including their financial
incentives. It said that underwriters should not be required to make
such disclosures as long as their failure to do so did not amount to
false or fraudulent conduct.
    MSRB Response: A number of NAIPFA's suggested disclosures were
presented to the MSRB in connection with the MSRB's proposed amendments
to Rule G-23 and were addressed by the

MSRB in its filing with the SEC.\7\ The MSRB's interpretive notice
regarding Rule G-23 contained in that filing provides that a dealer
will be considered to be acting as an underwriter for purposes of Rule
G-23(b) if, among other things, it provides written disclosure to the
issuer from the earliest stages of its relationship with the issuer
that it is an underwriter and not a financial advisor and does not
engage in a course of conduct that is inconsistent with arm's-length
relationship with the issuer. The writing must make clear that the
primary role of an underwriter is to purchase, or arrange for the
placement of, securities in an arm's-length commercial transaction
between the issuer and the underwriter and that the underwriter has
financial and other interests that differ from those of the issuer.
Rule G-17 is appropriately applied differently to market participants
with different roles in a financing. Thus, for example, Rule G-17 may
appropriately be interpreted to apply different standards of conduct to
municipal advisors, which function as trusted advisors to municipal
entities and obligated persons, than it does to underwriters of
municipal securities, which are arm's-length counterparties to issuers
of municipal securities, and dealers who solicit municipal entities on
behalf of third-party clients.
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    \7\ See Amendment No. 1 to SR-MSRB-2011-03 (May 26, 2011). See
also Exchange Act Release No. 64564 (May 27, 2011) (File No. SR-
MSRB-2011-03).
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    Consistent with this interpretation of Rule G-17, the disclosures
required by the Notice do not amount to the imposition of a fiduciary
duty, whether ``lite'' or otherwise, on underwriters of municipal
securities. Simple principles of fair dealing require that underwriters
have more than a caveat emptor relationship with their issuer clients.
     Comments: Payments to and from Third Parties. BDA said
that the MSRB should clarify what types of third party payments it was
interested in and that they should not include tender option bond
programs and similar arrangements. Alternatively, BDA said that generic
disclosure should suffice. It argued that a requirement to disclose
retail distribution and selling group arrangements was unnecessary
because such arrangements were typically disclosed in official
statements. In addition, SIFMA said that the MSRB should clarify the
details of required disclosures and confirm that issuer consent to
disclosures regarding third-party payments is not required. It argued
that payments or internal credits among the underwriter and its
affiliates should not be required to be disclosed. It made the same
argument with respect to payments or other benefits received from
collateral transactions, such as credit default swaps (CDS). While it
argued that the proposed standard was inconsistent with SEC and FINRA
requirements, it did not cite specific examples.
    MSRB Response: The MSRB believes that issuers of municipal
securities should be apprised of payments, values, or credits made to
underwriters that might color the underwriter's judgment and cause it
to recommend products, structures, and pricing levels to an issuer when
it would not have done so absent such payments. For example, if a swap
dealer affiliate of the underwriter were to make a payment to, or
otherwise credit, the underwriter for the underwriter's successful
recommendation that the issuer enter into a swap that is integrally
related to a municipal securities issue, the Notice would require that
such payment or credit be disclosed to the issuer. Generic disclosure
would not suffice. However, only payments made in connection with the
dealer's underwriting of a new issue would be required to be disclosed.
Payments from purchasers of interests in tender option bond programs
would not typically be made in connection with the underwriting and,
therefore, would not typically be required to be disclosed. The MSRB
considers it essential that an issuer be made aware of retail
distribution and selling group arrangements that are integral to the
underwriter's ability to provide the services that it has contracted
with the issuer to provide. If such arrangements are already disclosed
in official statements, this requirement of the Notice should not
impose an additional burden on the underwriter.
     Comments: Profit-Sharing with Investors. SIFMA said that
the MSRB should provide guidance on what is meant by profit-sharing
with investors that, depending upon the facts and circumstances, could
result in a Rule G-17 violation.
    MSRB Response: The provisions of the Notice concerning profit-
sharing with investors resulted in part from reports to the MSRB that
underwriters of Build America Bonds sold such bonds to institutional
investors that then resold the bonds to such underwriters shortly
thereafter at prices above their initial purchase price but below
rising secondary market prices. If these reports were accurate and
reflected formal or informal arrangements between such underwriters and
institutional investors, these re-sales allowed the investors and the
underwriters to share in the increase in value of the bonds. The MSRB
has amended the Notice to note that ``such arrangements could also
constitute a violation of Rule G-25(c), which precludes a dealer from
sharing, directly or indirectly, in the profits or losses of a
transaction in municipal securities with or for a customer.''
     Comments: CDS Disclosures. BDA said that general
disclosures about trading in an issuer's CDS should suffice and that
information barriers within firms might prevent more detailed knowledge
by the dealer personnel underwriting an issuer's securities. SIFMA made
the same arguments and additionally said that the proposal that
underwriters disclose their CDS activity would be highly prejudicial
because it would require underwriters to disclose their hedging and
risk management activities and could potentially compromise
counterparty arrangements. It argued that, if this requirement were
maintained by the MSRB, it should exempt dealing in CDS that reference
a basket of securities, including the issuer's.
    MSRB Response: The MSRB is mindful that appropriate information
barriers may prevent personnel of a dealer firm engaged in underwriting
activities from knowing about hedging activities of other parts of the
dealer. However, the Notice requires only that a dealer that engages in
the issuance or purchase of a credit default swap for which the
underlying reference is an issuer for which the dealer is serving as
underwriter, or an obligation of that issuer, must disclose that to the
issuer. The Notice does not require information about specific trades
or confidential counterparty information. The MSRB has amended the
Notice to provide that disclosures would not be required with regard to
trading in CDS based on baskets or indexes including the issuer or its
obligation(s) unless the issuer or its obligation(s) represented more
than 2% of the total notional amount of the credit default swap or the
underwriter otherwise caused the issuer or its obligation(s) to be
included in the basket or index. The most commonly traded municipal CDS
basket--Markit MCDX--currently imposes this 2% limit on the components
of its basket.
Retail Order Periods
     Comments: Retail Orders. BDA said that the MSRB should
clarify what reasonable measures underwriters must take to ensure that
retail orders are bona fide and said that underwriters should be able
to rely on representations of selling group members. SIFMA made

similar arguments about reliance upon representations of co-managers
made in agreements among underwriters.
    MSRB Response: The MSRB is aware that, in many cases, orders are
placed in retail order periods in a manner that is designed to ``game''
the retail order period requirements of the issuer. For example, in a
retail order period in which the issuer has defined a retail order as
one not exceeding $1,000,000 in principal amount, a dealer may place a
number of $1,000,000 orders. Such a pattern of orders should cause a
member of the underwriting syndicate to question whether such orders
are bona fide retail orders. While it would be good practice for senior
managing underwriters to require that co-managers and selling group
members represent that orders represented to be retail orders in fact
meet the issuer's definition of ``retail,'' the MSRB would not consider
such representations to be dispositive and would expect the senior
manager to make appropriate inquiries when ``red flags'' such as
described above could cause the senior manager to question the nature
of the order. As an example of a ``reasonable measure,'' a senior
managing underwriter might require the zip codes attributable to the
retail orders. With regard to orders placed by retail dealers, the MSRB
reiterates that it would not consider an order ``for stock,'' without
``going away orders,'' to be a customer order.\8\
---------------------------------------------------------------------------

    \8\ See Exchange Act Release No. 62715 (August 13, 2010) (File
No. SR-MSRB-2009-17).
---------------------------------------------------------------------------

Dealer Payments to Issuer Personnel
     Comments: Rule G-20. SIFMA requested that the MSRB clarify
that its statements regarding Rule G-20 in the Notice were only
reminders and that the MSRB did not intend to expand its previous
guidance on Rule G-20 by means of the Notice.
    MSRB Response: The provisions in the Notice regarding Rule G-20 are
only reminders of existing MSRB guidance.
Miscellaneous
     Comments: Coordinated Rulemaking. AFSCME strongly
supported the notice; however, it urged the MSRB to coordinate its
rulemaking with the SEC and the CFTC. BDA said that the Notice should
not create overlapping and potentially conflicting obligations with SEC
and CFTC rules and that the Notice might be premature, given ongoing
rulemaking by the SEC and the CFTC. SIFMA said that the MSRB should
defer the imposition of disclosure requirements concerning swaps and
security-based swaps because these would be the subject of rulemaking
by the SEC and CFTC.
    MSRB Response: The MSRB is aware of ongoing rulemaking by the SEC
and the CFTC and has taken care to ensure that any requirements of the
Notice are consistent with such rulemaking. For example, the provisions
of the Notice concerning the disclosures associated with complex
municipal securities financings are appropriately consistent with the
CFTC's proposed business conduct rule for swap dealers and major swap
participants \9\ and the SEC's proposed business conduct rule for
security-based swap dealers and major security-based swap
participants.\10\ The MSRB may undertake additional rulemaking as
necessary to ensure such consistency in the future. In addition,
dealers are reminded that they may be subject to other regulatory
requirements.
---------------------------------------------------------------------------

    \9\ See Federal Register Vol. 75, No. 245 (December 22, 2010).
    \10\ See Federal Register Vol. 76, No. 137 (July 18, 2011).
---------------------------------------------------------------------------

     Comments: Effective Date. SIFMA argued that many of the
Notice's requirements would require the development of compliance
systems and that the Notice should not become effective for at least
one year after its approval by the SEC.
    MSRB Response: The MSRB agrees that some delay in the effective
date of the proposed rule change is appropriate, because the MSRB has
not previously articulated an interpretation of Rule G-17 that would
require many of the specific disclosures required by the Notice.
However, the MSRB considers a delay of one year to be too long. The
MSRB has requested that the proposed rule change be made effective 90
days after approval by the Commission.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) As the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Exchange Act. Interested persons are also
invited to submit views and arguments as to whether underwriters should
be required to disclose to municipal entities the conflicts of interest
associated with their compensation arrangements in a manner similar to
what the MSRB has proposed for municipal advisors. 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 Number SR-MSRB-2011-09 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 Number SR-MSRB-2011-09. 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 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 MSRB's offices. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-MSRB-2011-09 and should be submitted on or before
September 30, 2011.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-23103 Filed 9-8-11; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 82, Number 65 (Thursday, April 6, 2017)]
[Rules and Regulations]
[Pages 16740-16741]
[FR Doc No: 2017-06888]

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

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 81

[EPA-R05-OAR-2016-0277; FRL-9960-91-Region 5]

Reclassification of the Sheboygan, Wisconsin Area To Moderate
Nonattainment for the 2008 Ozone National Ambient Air Quality
Standards; Correction

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule; correction.

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

SUMMARY: The Environmental Protection Agency (EPA) published a final
rule in the Federal Register on December 19, 2016, revising its
regulations entitled ``Designation of Areas for Air Quality Planning
Purposes'' for the 2008 ozone National Ambient Air Quality Standards
(NAAQS). An error in the table for the Wisconsin 2008 8-Hour Ozone
NAAQS is identified and corrected in this action.

DATES: This final rule is effective on April 6, 2017.

FOR FURTHER INFORMATION CONTACT: Kathleen D'Agostino, Environmental
Scientist, Attainment Planning and Maintenance Section, Air Programs
Branch (AR-18J), Environmental Protection Agency, Region 5, 77 West
Jackson Boulevard, Chicago, Illinois 60604,<PHONE_NUMBER>,
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: EPA published a final rule document on
December 19, 2016, (81 FR 91841) updating 40 CFR part 81, ``Designation
of Areas for Air Quality Planning Purposes'' for the 2008 8-Hour Ozone
NAAQS. This final rule included a revision to 40 CFR 81.350
reclassifying the Sheboygan, Wisconsin area (Sheboygan County) as
``moderate'' nonattainment for the 2008 ozone NAAQS. The entry for the
Sheboygan County designated area in the Wisconsin-2008 8-Hour Ozone
NAAQS (Primary and secondary) table erroneously indicated that the
effective date of the classification is January 18, 2017 when, in fact,
the effective date should have been December 19, 2016. 81 FR 91846.
Therefore, the entry for the Sheboygan County area is being corrected
to reflect the correct classification date.

List of Subjects in 40 CFR Part 81

    Environmental protection, Air pollution control, National parks,
Wilderness areas.

    Dated: March 21, 2017.
Robert A. Kaplan,
Acting Regional Administrator, Region 5.

    40 CFR part 81 is amended by the following correcting amendment:

PART 81--DESIGNATION OF AREAS FOR AIR QUALITY PLANNING PURPOSES

0
1. The authority citation for part 81 continues to read as follows:

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

0
2. In Sec.  81.350, the table entitled ``Wisconsin-2008 8-Hour Ozone
NAAQS (Primary and secondary)'' is amended by revising the entry for
``Sheboygan County, WI:'' to read as follows:

Sec.  81.350  Wisconsin.

* * * * *

                                       Wisconsin--2008 8-Hour Ozone NAAQS
                                             [Primary and secondary]
----------------------------------------------------------------------------------------------------------------
                                               Designation                             Classification
       Designated area        ----------------------------------------------------------------------------------
                                  Date \1\                 Type                Date \1\             Type
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
Sheboygan County, WI: \2\      ..............  Nonattainment..............      12/19/2016  Moderate.
 Sheboygan County.

                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
\1\ This date is July 20, 2012, unless otherwise noted.
\2\ Excludes Indian country located in each area, unless otherwise noted.

* * * * *
[FR Doc. 2017-06888 Filed 4-5-17; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register Volume 80, Number 239 (Monday, December 14, 2015)]
[Notices]
[Pages 77396-77397]
[FR Doc No: 2015-31360]

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

SECURITIES AND EXCHANGE COMMISSION

Submission for OMB Review; Comment Request

Upon Written Request Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE., Washington, DC
20549-2736.

Extension:
    Rule 17Ad-11, SEC File No. 270-261, OMB Control No. 3235-0274.

    Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.) (``PRA''), the Securities and Exchange
Commission (``Commission'') has submitted to the Office of Management
and Budget (``OMB'') a request for approval of extension of the
previously approved collection of information provided for in Rule
17Ad-11 (17 CFR 240.17Ad-11) under the Securities Exchange Act of 1934
(15 U.S.C. 78a et seq.).
    Rule 17Ad-11 requires every registered recordkeeping transfer agent
to report to issuers and its appropriate regulatory agency in the event
that the aggregate market value of an aged record difference exceeds
certain thresholds. A record difference occurs when an issuer's records
do not agree with those of securityholders as indicated, for instance,
on certificates presented to the transfer agent for purchase,
redemption or transfer. An aged record difference is a record
difference that has existed for more than 30 calendar days. In
addition, the rule requires every recordkeeping transfer agent to
report to its appropriate regulatory agency in the event of a failure
to post certificate detail to the master securityholder file within
five business days of the time required by Rule 17Ad-10 (17 CFR
240.17Ad-10). Also, a transfer agent must maintain a copy of any report
required under Rule 17Ad-11 for a period of not less than three years
following the date of the report, the first year in an easily
accessible place.
    Because the information required by Rule 17Ad-11 is already
available to transfer agents, any collection burden for small transfer
agents is minimal. Based on a review of the number of Rule 17Ad-11
reports the Commission, the Comptroller of the Currency, the Board of
Governors of the Federal Reserve System, and the Federal Deposit
Insurance Corporation received since 2012, the Commission staff
estimates that 10 respondents will file a total of approximately 12
reports annually. The Commission staff estimates that, on average, each
report can be completed in 30 minutes. Therefore, the total annual
hourly burden to the entire transfer agent industry is approximately
six hours (30 minutes x 12 reports). Assuming an average hourly rate of
$25 for a transfer agent staff employee, the average total internal
cost of the report is $12.50. The total annual internal cost of
compliance for the approximate 10 respondents is approximately $150.00
(12 reports x $12.50).
    The retention period for the recordkeeping requirement under Rule
17Ad-11 is three years following the date of a report prepared pursuant
to the rule. The recordkeeping requirement under Rule 17Ad-11 is
mandatory to assist the Commission and other regulatory agencies with
monitoring transfer agents and ensuring compliance with the rule. This
rule does not involve the collection of confidential information.
    An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information under the PRA unless it
displays a currently valid OMB number.
    Background documentation for this information collection may be
viewed at the following Web site: www.reginfo.gov. Comments should be
directed to: (i) Desk Officer for the Securities and Exchange
Commission, Office of Information and Regulatory Affairs, Office of
Management and Budget, Room 10102, New Executive Office Building,
Washington, DC 20503 or by sending an email to: (i)
<EMAIL_ADDRESS>and (ii) Pamela Dyson, Director/Chief
Information Officer, Securities and Exchange Commission, c/o Remi
Pavlik-Simon, 100 F Street NE., Washington, DC 20549, or by sending an
email to PRA_

<EMAIL_ADDRESS>Comments must be submitted to OMB within 30 days of
this notice.

    Dated: December 8, 2015.
Brent J. Fields,
Secretary.
[FR Doc. 2015-31360 Filed 12-11-15; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 76, Number 117 (Friday, June 17, 2011)]
[Proposed Rules]
[Pages 35678-35681]
[FR Doc No: 2011-14771]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Parts 201 and 310

[Docket No. FDA-2011-N-0449]

SPF Labeling and Testing Requirements and Drug Facts Labeling for
Over-the-Counter Sunscreen Drug Products; Agency Information Collection
Activities; Proposed Collection

AGENCY: Food and Drug Administration, HHS.

ACTION: Comment request.

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

SUMMARY: The Food and Drug Administration (FDA) is announcing an
opportunity for public comment on the proposed collection of certain
information by the Agency. Under the Paperwork Reduction Act of 1995
(the PRA), Federal Agencies are required to publish notice in the
Federal Register concerning each proposed collection of information and
to allow 60 days for public comment in response to the notice. This
notice solicits comments on SPF labeling and testing requirements for
over-the-counter (OTC) sunscreen products containing specified
ingredients and marketed without approved applications, and on
compliance with Drug Facts labeling requirements for all OTC sunscreen
products.

DATES: Submit either electronic or written comments on the collection
of information by August 16, 2011.

ADDRESSES: Submit electronic comments on the collection of information
to http://www.regulations.gov. Submit written comments on the
collection of information to the Division of Dockets Management (HFA-
305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061,
Rockville, MD 20852. All comments should be identified with the docket
number found in brackets in the heading of this document.

FOR FURTHER INFORMATION CONTACT:
Elizabeth Berbakos, Office of Information Management, Food and Drug
Administration, 1350 Piccard Dr., PI50-400B, Rockville, MD 20850, 301-
796-3792<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Under the PRA (44 U.S.C. 3501-3520), Federal
Agencies must obtain approval from the Office of Management and Budget
(OMB) for each collection of information they conduct or sponsor.
``Collection of information'' is defined

in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes Agency requests
or requirements that members of the public submit reports, keep
records, or provide information to a third party. Section 3506(c)(2)(A)
of the PRA (44 U.S.C. 3506(c)(2)(A)) requires Federal Agencies to
provide a 60-day notice in the Federal Register concerning each
proposed collection of information before submitting the collection to
OMB for approval. To comply with this requirement, FDA is publishing
notice of the proposed collection of information set forth in this
document.
    With respect to the following collection of information, FDA
invites comments on these topics: (1) Whether the proposed collection
of information is necessary for the proper performance of FDA's
functions, including whether the information will have practical
utility; (2) the accuracy of FDA's estimate of the burden of the
proposed collection of information, including the validity of the
methodology and assumptions used; (3) ways to enhance the quality,
utility, and clarity of the information to be collected; and (4) ways
to minimize the burden of the collection of information on respondents,
including through the use of automated collection techniques, when
appropriate, and other forms of information technology.

SPF Labeling and Testing Requirements for OTC Sunscreen Products
Containing Specified Active Ingredients and Marketed Without Approved
Applications, and Drug Facts Labeling for All OTC Sunscreen Products--
21 CFR 201.327(a)(1) and (i), 21 CFR 201.66(c) and (d)--(OMB 0910-New)

    Elsewhere in this issue of the Federal Register, we (FDA) are
publishing a final rule establishing labeling and effectiveness testing
requirements for certain OTC sunscreen products containing specified
active ingredients and marketed without approved applications (2011
sunscreen final rule; Sec.  201.327 (21 CFR 201.327)). The rule also
lifts the delay of implementation date of the Drugs Facts regulation
(21 CFR 201.66) for all OTC sunscreens. This rule is not yet in effect.
It is intended to be effective June 18, 2012.

SPF Labeling and Testing for OTC Sunscreens Containing Specified Active
Ingredients and Marketed Without Approved Applications

    Section 201.327(a)(1) requires the principal display panel (PDP)
labeling of a sunscreen covered by the rule to include the SPF value
determined by conducting the SPF test outlined in Sec.  201.327(i).
Therefore, this provision will result in an information collection with
a third-party disclosure burden for manufacturers of OTC sunscreens
covered by the rule. Products need only complete the testing and
labeling required by the rule one time, and then continue to utilize
the resultant labeling (third-party disclosure) going forward, without
additional burden.
    In a draft guidance published elsewhere in this issue of the
Federal Register, we state that we do not intend to initiate
enforcement action before June 17, 2013 if an OTC sunscreen subject to
Sec.  201.327 that was initially marketed prior to June 17, 2011, the
date of publication of the final rule, continues to include an SPF
value in its labeling that was determined prior to that date according
to either the SPF test method described in the May 21, 1999, final rule
(64 FR 27666 at 27689 through 27693) or the SPF test method described
in the August 27, 2007, proposed rule (72 FR 49070 at 49114 through
49119). We believe that the majority of currently-marketed OTC
sunscreen formulations will meet this standard and, therefore, may
defer their conduct of new SPF testing. However, this one-time testing
will nonetheless need to be conducted within the first 3 years after
publication of the 2011 final rule for all OTC sunscreens covered by
that rule. We therefore do not anticipate that the draft guidance will
alter the annualized burden associated with Sec. Sec.  201.327(a)(1)
and (i) as estimated here. We provide a separate PRA analysis in the
notice of availability for the draft guidance to address the
information collections provisions that result from it.
    Our estimate of third-party disclosure burden includes the time for
reviewing instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing each
collection of information. We have estimated that there are
approximately 100 manufacturers of OTC sunscreen drug products. We
estimate that these 100 manufacturers are currently producing as many
as 2,350 OTC sunscreen formulations and that these formulations are
available in approximately 3,600 stock keeping units (SKUs) (see 2010
sunscreen final rule--indicating recent data supports estimate of up to
2,348 formulations and 3,591 SKUs).\1\
---------------------------------------------------------------------------

    \1\ Document No. FDA-1978-N-0018-0693 in Docket No. FDA-1978-N-
0018.
---------------------------------------------------------------------------

    Our estimates on the conduct of SPF testing are based on the
estimated number of formulations because, if the same formulation is
sold under different SKUs, the formulation will only have to be
retested one time in order to develop the labeling for multiple
marketed SKUs. However, our estimates on labeling are based on the
number of SKUs because, although each SKU will not need to be tested to
establish its SPF value, the labeling of each SKU has to be considered.
    To determine the SPF value required in Sec.  201.327(a)(1),
manufacturers will have to conduct SPF tests according to Sec.
201.327(i). We estimate that all 100 manufacturers will have to retest
currently marketed sunscreen formulations. We estimate that there are
approximately 2,350 existing sunscreen formulations that will require
retesting. We further estimate that it will take 24 hours (i.e., three
8-hour days) to complete SPF testing for each of the formulations. This
estimate assumes SPF testing of a high SPF sunscreen that includes 80
minutes of water resistance testing, which reflects products requiring
the most time to test. Therefore, a total of 56,400 hours will be
required as the one-time burden to retest existing sunscreen products
in accordance with Sec.  201.327(i) to provide the SPF value required
to be disclosed to the public in labeling under Sec.  201.327(a)(1). In
accordance with FDA's enforcement policy guidance, retesting of
currently marketed sunscreen products should be completed within 2
years after the date of publication of the final rule, so if this one-
time burden is annualized across that time period, the result is a
burden of 28,200 hours in each of the first 2 years to complete
retesting of existing sunscreen products.
    Once manufacturers have tested their products to determine the SPF
value to comply with the third-party disclosure (labeling) requirements
in Sec.  201.327(a)(1), the manufacturers will need to insert the SPF
value after the term ``SPF'' in either the statement ``SPF'' or ``Broad
Spectrum SPF,'' as applicable. We estimate that each of the 100
manufacturers will spend no more than 0.5 hours per SKU to prepare,
complete, and review the labeling for each of 3,600 currently marketed
SKUs. Therefore, we estimate that a total of no more than 1,800 hours
will be required as a one time burden to relabel currently marketed OTC
sunscreens containing specified ingredients and marketed without
approved applications (3,600 SKUs times 0.5 hours per SKU). In
accordance with FDA's enforcement policy guidance, relabeling of
currently marketed sunscreen products should be completed within 2
years after the date of publication of the final rule, so if this one-
time burden is annualized across that time period, the result is a
burden

of 900 hours in each of the first 2 years to complete relabeling of
existing sunscreen products.
    In addition, new products may also be introduced each year, and
these products will have to be tested and labeled with the SPF value
determined in the test. We estimate that as many as 60 new OTC
sunscreen products (SKUs) may be introduced each year. As discussed in
this section of the document, there are currently approximately 1.53
SKUs marketed for every sunscreen formulation (3,600 SKUs divided by
2,350 formulations). Therefore, we estimate that the 60 new sunscreen
SKUs will represent 39 new formulations annually. We expect the burden
of testing the 39 new formulations marketed each year will require 936
hours per year (39 formulations times 24 hours testing per
formulation). We estimate that labeling of the 60 new SKUs marketed
each year will require 30 hours per year (60 SKUs times 0.5 hours per
SKU).
    We estimate the burden of this collection of information as
follows:

                           Table 1--Estimated Annual Third-Party Disclosure Burden \1\
----------------------------------------------------------------------------------------------------------------
                                                      Annual
            Activity                  No. of       frequency per   Total annual      Hours per      Total hours
                                    respondents      response        responses       response
----------------------------------------------------------------------------------------------------------------
Conduct SPF testing in                       100           11.75           1,175              24          28,200
 accordance with Sec.
 201.327(i) for existing
 sunscreen formulations \2\.....
Conduct SPF testing in                        20            1.95              39              24             936
 accordance with Sec.
 201.327(i) for new sunscreen
 formulations...................
Create PDP labeling in                       100             180           1,800             0.5             900
 accordance with Sec.
 201.327(a)(1) for existing
 sunscreen SKUs \2\.............
Create PDP labeling in                        20               3              60             0.5              30
 accordance with Sec.
 201.327(a)(1) for new sunscreen
 SKUs...........................
                                 -------------------------------------------------------------------------------
    Total burden in years one     ..............  ..............  ..............  ..............          30,066
     and two....................
                                 -------------------------------------------------------------------------------
    Total burden in each          ..............  ..............  ..............  ..............             966
     subsequent year............
----------------------------------------------------------------------------------------------------------------
\1\ There are no capital, operating or maintenance costs associated with this collection of information.
\2\ Burden for each of first and second years for currently marketed OTC sunscreens.

Drug Facts Labeling for OTC Sunscreens

    Because the 2011 final rule also lifts the delay of implementation
date for Drug Facts regulations (21 CFR 201.66) for OTC sunscreens, the
rule will also modify the information collection associated with Sec.
201.66 (currently approved under OMB control number 0910-0340) and
result in additional third-party disclosure burden resulting from
requiring OTC sunscreen products to comply with Drug Facts regulations.
In the Federal Register of March 17, 1999 (64 FR 13254), we amended our
regulations governing requirements for human drug products to establish
standardized format and content requirements for the labeling of all
marketed OTC drug products, codified in 21 CFR 201.66 (the 1999 Drug
Facts labeling final rule). Section 201.66 sets requirements for the
Drug Facts portion of labels on OTC drug products, requiring such
labeling to include uniform headings and subheadings, presented in a
standardized order, with minimum standards for type size and other
graphical features. In the Federal Register of September 3, 2004 (69 FR
53801), we delayed the Sec.  201.66 implementation date for OTC
sunscreen products indefinitely, pending future rulemaking to amend the
substance of labeling for these products. The 2011 sunscreen final rule
lifts this stay for OTC sunscreens. Therefore, currently marketed OTC
sunscreen products will incur a one-time burden to comply with the
requirements in 21 CFR 201.66 (c) and (d).
    We estimate that there are 3,600 currently marketed OTC sunscreen
drug product SKUs, and we assume for purposes of this estimate that
none of them have yet complied with the 1999 Drug Facts labeling final
rule. These 3,600 SKUs will need to implement the new labeling format
by the implementation date included in the sunscreen final rule. We
estimate that these 3,600 SKUs are marketed by 100 manufacturers and
that approximately 12 hours will be spent on each label. The number of
hours per label (response) is based on the most recent estimate used
for other OTC drug products to comply with the 1999 Drug Facts labeling
final rule, including public comments received on this estimate in 2010
that addressed sunscreens. If an average of 12 hours is spent
preparing, completing, and reviewing each of the estimated 3,600
sunscreen SKUs, the total number of hours dedicated to the one-time
relabeling of currently marketed OTC sunscreen products, as necessary
to comply with Sec.  201.66 would be 43,200 (3,600 SKUs times 12 hours/
SKU).
    In addition to this one-time burden, we estimate that 60 new
sunscreen SKUs marketed each year will have a third-party disclosure
burden to comply with Drug Facts regulations equal to 720 hours
annually (60 SKUs times 12 hours/SKU). We estimate that these new SKUs
will be marketed by 20 manufacturers. We do not expect any OTC
sunscreens to apply for exemptions or deferrals of the Drug Facts
regulations 21 CFR 201.66(e).
    We estimate the burden of this collection of information as
follows:

                           Table 2--Estimated Annual Third-Party Disclosure Burden \1\
----------------------------------------------------------------------------------------------------------------
                                                      Annual
            Activity                  No. of       frequency per   Total annual      Hours per      Total hours
                                    respondents      response        responses       response
----------------------------------------------------------------------------------------------------------------
Format labeling in accordance                100              36           3,600              12          43,200
 with 201.66(c) and (d) for
 existing sunscreen SKUs \2\....

Format labeling in accordance                 20               3              60              12             720
 with 201.66(c) and (d) for new
 sunscreen SKUs.................
                                 -------------------------------------------------------------------------------
    Total first year burden.....  ..............  ..............  ..............  ..............          43,920
                                 -------------------------------------------------------------------------------
    Total burden for each         ..............  ..............  ..............  ..............             720
     subsequent year............
----------------------------------------------------------------------------------------------------------------
\1\ We estimate a one-time medium capital cost of $6.1 million dollars will result from preparing labeling
  content and format for OTC sunscreens in accordance with Sec.   201.66. There are no operating or maintenance
  costs associated with this collection of information.
\2\ First-year burden for currently marketed OTC sunscreens.

    With the exception of the PDP statement of SPF value in Sec.
201.327(a)(1), the labeling requirements in Sec.  201.327(a) through
(h), which provide other elements of the PDP, as well as specific
content for indications, directions, and warnings, are a ``public
disclosure of information originally supplied by the Federal Government
to the recipient for the purpose of disclosure to the public'' (5 CFR
1320.3(c)(2)) and, therefore, are not collections of information. These
provisions are thus not subject to OMB review under the PRA.

    Dated: June 9, 2011.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2011-14771 Filed 6-14-11; 8:45 am]
BILLING CODE 4160-01-P


[Federal Register Volume 85, Number 165 (Tuesday, August 25, 2020)]
[Notices]
[Pages 52338-52339]
[FR Doc No: 2020-18608]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. ER20-2690-000]

Jordan Creek Wind Farm LLC; Supplemental Notice That Initial
Market-Based Rate Filing Includes Request for Blanket Section 204
Authorization

    This is a supplemental notice in the above-referenced proceeding of
Jordan Creek Wind Farm LLC's application for market-based rate
authority, with an accompanying rate tariff, noting that such
application includes a request for blanket authorization, under 18 CFR
part 34, of future issuances of securities and assumptions of
liability.
    Any person desiring to intervene or to protest should file with the
Federal Energy Regulatory Commission, 888 First Street NE, Washington,
DC 20426, in accordance with Rules 211 and 214 of the Commission's
Rules of Practice

and Procedure (18 CFR 385.211 and 385.214). Anyone filing a motion to
intervene or protest must serve a copy of that document on the
Applicant.
    Notice is hereby given that the deadline for filing protests with
regard to the applicant's request for blanket authorization, under 18
CFR part 34, of future issuances of securities and assumptions of
liability, is September 8, 2020.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with internet
access who will eFile a document and/or be listed as a contact for an
intervenor must create and validate an eRegistration account using the
eRegistration link. Select the eFiling link to log on and submit the
intervention or protests.
    Persons unable to file electronically may mail similar pleadings to
the Federal Energy Regulatory Commission, 888 First Street NE,
Washington, DC 20426. Hand delivered submissions in docketed
proceedings should be delivered to Health and Human Services, 12225
Wilkins Avenue, Rockville, Maryland 20852.
    In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
internet through the Commission's Home Page (http://ferc.gov) using the
``eLibrary'' link. Enter the docket number excluding the last three
digits in the docket number field to access the document. At this time,
the Commission has suspended access to the Commission's Public
Reference Room, due to the proclamation declaring a National Emergency
concerning the Novel Coronavirus Disease (COVID-19), issued by the
President on March 13, 2020. For assistance, contact the Federal Energy
Regulatory Commission at<EMAIL_ADDRESS>or call toll-free,
(886) 208-3676 or TYY,<PHONE_NUMBER>.

    Dated: August 19, 2020.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2020-18608 Filed 8-24-20; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 82, Number 107 (Tuesday, June 6, 2017)]
[Rules and Regulations]
[Pages 25959-25960]
[FR Doc No: 2017-11377]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2016-9443; Airspace Docket No. 16-ASO-17]

Amendment of Class E Airspace; Kyle-Oakley Field Airport, Murray,
KY

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: This action amends Class E airspace at Murray, KY, as the
Calloway non-directional beacon (NDB) has been decommissioned,
requiring airspace reconfiguration at Kyle-Oakley Field Airport. This
action enhances the safety and airspace management of instrument flight
rules (IFR) operations at the airport. This action also updates the
geographic coordinates of the airport and updates the airspace
designation header.

DATES: Effective 0901 UTC, August 17, 2017. The Director of the Federal
Register approves this incorporation by reference action under title 1,
Code of Federal Regulations, part 51, subject to the annual revision of
FAA Order 7400.11 and publication of conforming amendments.

ADDRESSES: FAA Order 7400.11A, Airspace Designations and Reporting
Points, and subsequent amendments can be viewed on line at http://www.faa.gov/air_traffic/publications/. For further information, you can
contact the Airspace Policy Group, Federal Aviation Administration, 800
Independence Avenue SW., Washington, DC, 20591; telephone: 1-(800)-647-
8927, or<PHONE_NUMBER>. The Order is also available for inspection at
the National Archives and Records Administration (NARA). For
information on the availability of FAA Order 7400.11A at NARA, call
(202)-741-6030, or go to http://www.archives.gov/federal_register/code_of_federal-regulations/ibr_locations.html.
    FAA Order 7400.11, Airspace Designations and Reporting Points, is
published yearly and effective on September 15.

FOR FURTHER INFORMATION CONTACT: John Fornito, Operations Support
Group, Eastern Service Center, Federal Aviation Administration, P.O.
Box 20636, Atlanta, GA 30320; telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Authority for This Rulemaking

    The FAA's authority to issue rules regarding aviation safety is
found in Title 49 of the United States Code. 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. This rulemaking is promulgated under the authority described
in Subtitle VII, Part, A, Subpart I, Section 40103. Under that section,
the FAA is charged with prescribing regulations to assign the use of
airspace necessary to ensure the safety of aircraft and the efficient
use of airspace. This regulation is within the scope of that authority
as it amends Class E airspace extending upward from 700 feet above the
surface at Kyle-Oakley Field Airport, Murray, KY, for continued safety
and management of IFR operations at the airport.

History

    The FAA published a notice of proposed rulemaking (NPRM in the
Federal Register (82 FR 4221, January 13, 2017) Docket No. FAA-2016-
9443 to amend Class E airspace extending upward from 700 feet above the
surface at Kyle-Oakley Field Airport, Murray, KY, due to the
decommissioning of the Calloway NDB and cancellation of the NDB
approach. The NPRM also advised of the proposed amendment of the
airport's geographic coordinates and the airport designation header to
include the airport name. Interested parties were invited to
participate in this rulemaking effort by submitting written comments on
the proposal to the FAA. No comments were received.
    Class E airspace designations are published in paragraph 6005 of
FAA Order 7400.11A dated August 3, 2016, and effective September 15,
2016, which is incorporated by reference in 14 CFR part 71.1. The Class
E airspace designations listed in this document will be published
subsequently in the Order.

Availability and Summary of Documents for Incorporation by Reference

    This document amends FAA Order 7400.11A, Airspace Designations and
Reporting Points, dated August 3, 2016, and effective September 15,
2016. FAA Order 7400.11A is publicly available as

listed in the ADDRESSES section of this document. FAA Order 7400.11A
lists Class A, B, C, D, and E airspace areas, air traffic service
routes, and reporting points.

The Rule

    This amendment to Title 14, Code of Federal Regulations (14 CFR)
part 71 amends Class E airspace extending upward from 700 feet above
the surface within a 7-mile radius of Kyle-Oakley Field Airport,
Murray, KY, due to the decommissioning of the Calloway NDB and
cancellation of the NDB approach. Therefore, these changes are
necessary for continued safety and management of IFR operations at the
airport. The geographic coordinates of the airport are amended to
coincide with the FAAs aeronautical database, and the airport
designation header, as noted in FAA Order 7400.11A, is updated to
include the airport name.

Regulatory Notices and Analyses

    The FAA has determined that this regulation only involves an
established body of technical regulations for which frequent and
routine amendments are necessary to keep them operationally current.
It, therefore: (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) does not warrant preparation of a regulatory evaluation as the
anticipated impact is so minimal. Since this is a routine matter that
only affects air traffic procedures and air navigation, it is certified
that this rule, when promulgated, does not have a significant economic
impact on a substantial number of small entities under the criteria of
the Regulatory Flexibility Act.

Environmental Review

    The FAA has determined that this action qualifies for categorical
exclusion under the National Environmental Policy Act in accordance
with FAA Order 1050.1F, ``Environmental Impacts: Policies and
Procedures,'' paragraph 5-6.5a. This airspace action is not expected to
cause any potentially significant environmental impacts, and no
extraordinary circumstances exist that warrant preparation of an
environmental assessment.

Lists of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

Adoption of the Amendment

    In consideration of the foregoing, the Federal Aviation
Administration amends 14 CFR part 71 as follows:

PART 71--DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR
TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

0
1. The authority citation for part 71 continues to read as follows:

    Authority: 49 U.S.C. 106(f), 106(g); 40103, 40113, 40120, E.O.
10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.

Sec.  71.1  [Amended]

0
2. The incorporation by reference in 14 CFR 71.1 of FAA Order 7400.11A,
Airspace Designations and Reporting Points, dated August 3, 2016,
effective September 15, 2016, is amended as follows:

Paragraph 6005 Class E Airspace Areas Extending Upward From 700
Feet or More Above the Surface of the Earth.

* * * * *

ASO KY E5 Kyle-Oakley Field, Murray, KY [Amended]

Kyle-Oakley Field Airport, KY
    (Lat. 36[deg]39'52'' N., long. 88[deg]22'22'' W.)

    That airspace extending upward from 700 feet above the surface
within a 7 mile radius of Kyle-Oakley Field Airport.

    Issued in College Park, Georgia, on May 19, 2017.
Ryan W. Almasy,
Manager, Operations Support Group, Eastern Service Center, Air Traffic
Organization.
[FR Doc. 2017-11377 Filed 6-5-17; 8:45 am]
 BILLING CODE 4910-13-P