[Federal Register: January 12, 2010 (Volume 75, Number 7)]
[Notices]
[Page 1623-1625]
[DOCID:fr12ja10-66]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2008-N-0305]

Jason Vale; Denial of Hearing; Final Debarment Order

Agency: Food and Drug Administration, HHS.

ACTION:  Notice.

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SUMMARY: The Food and Drug Administration (FDA) is denying Jason Vale's
request for a hearing and is issuing an order under the Federal Food,
Drug, and Cosmetic Act (the act) permanently debarring Mr. Vale from
providing services in any capacity to a person that has an approved or
pending drug product application. FDA bases this order on a finding
that Mr. Vale was convicted of a felony under Federal law for conduct
relating to the regulation of a drug product under the act. Mr. Vale
has failed to file with the agency information and analyses sufficient
to create a basis for a hearing concerning this action.

DATES: The order is effective January 12, 2010.

ADDRESSES: Submit applications for termination of debarment to the
Division of Dockets Management (HFA-305), Food and Drug Administration,
5630 Fishers Lane, rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: G. Matthew Warren, Office of
Scientific Integrity, Food and Drug Administration, 10903 New Hampshire
Ave., Silver Spring, MD 20993,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Background

    On July 21, 2003, a Federal jury found Mr. Vale, formerly the
president of Christian Brother's Inc., guilty of three counts of
criminal contempt in violation of 18 U.S.C. 401(3). On June 18, 2004,
the U.S. District Court for the Eastern District of New York sentenced
Mr. Vale to 63 months in prison on each of the three counts, to be
served concurrently. On January 26, 2006, on remand from the Court of
Appeals for the Second Circuit, the district court reduced the sentence
to 60 months.
    Mr. Vale is subject to permanent debarment based on a finding,
under section 306(a)(2) of the act (21 U.S.C. 335a(a)(2)), that he was
convicted of a felony under Federal law for conduct relating to the
regulation of a drug product. Mr. Vale's convictions for contempt
stemmed from his violation of consent decrees of preliminary and
permanent injunction prohibiting him from distributing unapproved or
misbranded drugs, including any drugs or other products, containing or
purporting to contain, Laetrile, ``Vitamin B-17,'' amygdalin, or
apricot seeds. The evidence introduced at Mr. Vale's criminal contempt
trial showed that, in violation of the two injunctions, he continued to
promote and sell amygdalin-based products and apricot seeds under a
different business name. Mr. Vale acquired a post office box in Arizona
under the name ``Praise Distributing'' (Praise), began referring former
and incoming customers of Christian Brothers to a Praise phone number
for purchase of those products, and continued to sell those products to
his customers through Praise, with the assistance of others employed by
Christian Brothers. Mr. Vale's convictions for criminal contempt under
18 U.S.C. 401(3) related directly to the regulation of drug products
under the act. By continuing to market amygdalin-based products and
apricot seeds, Mr. Vale ignored two injunctions, which were intended to
prevent him from violating the requirements for drug products in the
act.
    By letter dated June 26, 2008, FDA served Mr. Vale a notice
proposing to permanently debar him from providing services in any
capacity to a person having an approved or pending drug product
application. In a letter dated August 13, 2008, Mr. Vale requested a
hearing on the proposal. In his request for a hearing, Mr. Vale
acknowledges his convictions under Federal law, as alleged by FDA.
However, he argues that his convictions for criminal contempt under 18
U.S.C. 401(3) are not felony convictions subjecting him to permanent
debarment under section 306(a)(2) of the act.
    We reviewed Mr. Vale's request for a hearing and find that Mr. Vale
has not created a basis for a hearing because hearings will be granted
only if there is a genuine and substantial issue of fact. Hearings will
not be granted on issues of policy or law, on mere allegations,
denials, or general descriptions of positions and contentions, or on
data and information insufficient to justify the factual determination
urged (see 21 CFR 12.24(b)).
    The Acting Chief Scientist and Deputy Commissioner has considered
Mr. Vale's arguments and concludes that they are unpersuasive and fail
to raise a genuine and substantial issue of fact requiring a hearing.

II. Argument

    Mr. Vale raises a single legal argument in support of his hearing
request. Citing Frank v. United States, 395 U.S. 147, 149-52 (1969), he
contends that his convictions for criminal contempt under 18 U.S.C.
401(3) may not be characterized as felony convictions for purposes of
section 306(a)(2) of the act because criminal contempt is not a felony
under Federal law. An offense is typically a felony if the maximum term
authorized is more than 1 year. (See 18 U.S.C. 3559(a)(1)-(5)
(categorizing offenses as felonies if maximum terms of imprisonment are
greater than 1 year); United States v. Wildes, 120 F.3d 468, 470 (4th
Cir. 1997) (relying on 18 U.S.C. 3559 to conclude that a felony is any
offense punishable by more than one year in prison)). Under 18 U.S.C.
401, however, there is no specific term of imprisonment authorized; a
Federal court has the power to punish criminal contempt by imprisonment
``at its discretion.''
    In Frank, the U.S. Supreme Court addressed whether a particular
offense under 18 U.S.C. 401 was ``petty'' or ``serious'' for purposes
of the criminal contemnor's right to a jury trial under the Sixth
Amendment. (395 U.S. at 148-52.) The Supreme Court acknowledged that
criminal contempt is a sui generis offense (id. at n.5, citing Cheff v.
Schnackenberg, 384 U.S. 373, 379-80 (1966)) in that ``a person may be
found in contempt for a great many different types of offenses, ranging
from disrespect for the court to acts otherwise criminal.'' (Frank, 395
U.S. at 149.) But the Court found that ``in prosecutions for criminal
contempt where no maximum penalty is authorized, the severity of the
penalty actually imposed is the best indication of the seriousness of
the particular offense.'' (Id.) The Court concluded that the particular
offense at issue was ``petty'' because the contemnor received less than
6 months in prison. (Id. at 152)
    In short, the Supreme Court held in Frank that, when sentence has
been imposed, the length of that sentence is an appropriate measure for
determining whether a criminal contempt conviction is a petty offense,
misdemeanor, or felony.\1\ FDA will therefore look to the sentence
imposed on Mr. Vale upon his conviction to evaluate whether his offense
under 18 U.S.C. 401(3) was a felony. At 5 years for each conviction,
Mr. Vale's sentences far exceeded 1 year, and thus his convictions were
clearly for felony offenses. Accordingly, FDA concludes that all three
of his convictions of criminal contempt subject him to mandatory
debarment under section 306(a)(2) of the act.
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    \1\ There is, however, a split among the Federal Circuits with
respect to whether a conviction for criminal contempt may be treated
as a felony. The Court of Appeals for the Fifth Circuit has read the
Supreme Court's decisions in Frank and Cheff to mean that criminal
contempt can never be a felony. (United States v. Holmes, 822 F.2d
481, 493-94 (5th Cir. 1987) (citing those cases for the proposition
that criminal contempt is neither a misdemeanor nor a felony)). The
Court of Appeals for the Ninth Circuit, however, has relied on the
decision in Frank to conclude that a conviction of criminal contempt
may be treated as a felony based on the defendant's sentencing
range. (United States v. Carpenter, 91 F.3d 1282, 1283-86 (9th Cir.
1996) (holding that courts should look to the appropriate sentencing
guideline range to determine whether a particular offense under 18
U.S.C. 401 is a felony); see also In re Cohn, 525 F.Supp.2d 1316,
1321 (S.D.Fla. 2007) (holding that criminal contempt is always a
Class A felony under 18 U.S.C. 3559(a) because the maximum sentence
is life in prison)).
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III. Findings and Order

    Therefore, the Acting Chief Scientist and Deputy Commissioner,
under section 306(a)(2)(B) of the act and under authority delegated to
him, finds that Mr. Vale has been convicted of a felony under Federal
law for conduct relating to the regulation of a drug product under the
act.
    As a result of the foregoing findings, Mr. Vale is permanently
debarred from providing services in any capacity to a person with an
approved or pending drug product application under section 505, 512, or
802 of the act (21 U.S.C. 355, 360b, or 382), or under section 351 of
the Public Health Service Act (42 U.S.C. 262), (see DATES) (see section
306(c)(1)(B) and (c)(2)(A)(ii) and section 201(dd) of the act (21
U.S.C. 321(dd))). Any person with an approved or pending drug product
application who knowingly uses the services of Mr. Vale, in any
capacity during his period of debarment, will be subject to civil money
penalties. If Mr. Vale, during his period of debarment, provides
services in any capacity to a person with an

approved or pending drug product application, he will be subject to
civil money penalties. In addition, FDA will not accept or review any
ANDAs submitted by or with the assistance of Mr. Vale during his period
of debarment.
    Any application by Mr. Vale for termination of debarment under
section 306(d)(4) of the act should be identified with Docket No. FDA-
2008-N-0305 and sent to the Division of Dockets Management (see
ADDRESSES). All such submissions are to be filed in four copies. The
public availability of information in these submissions is governed by
21 CFR 10.20(j). Publicly available submissions may be seen in the
Dockets Management Branch between 9 a.m. and 4 p.m., Monday through
Friday.

    Dated: January 4, 2010.
Jesse L. Goodman,
Acting Chief Scientist and Deputy Commissioner for Science and Public
Health.
[FR Doc. 2010-289 Filed 1-11-10; 8:45 am]
BILLING CODE 4160-01-S


[Federal Register: April 19, 2007 (Volume 72, Number 75)]
[Notices]
[Page 19733-19737]
[DOCID:fr19ap07-65]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55631; File No. SR-NSX-2006-16]

Self-Regulatory Organizations; National Stock Exchange, Inc.;
Notice of Filing of Proposed Rule Change and Amendment No. 1 Thereto
Regarding the Annual Certification of Compliance and Supervisory
Processes

April 13, 2007.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on November 22, 2006, the National Stock Exchange, Inc. (``NSX''
or ``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the Exchange. On April
9, 2007, the NSX filed Amendment No. 1 to the proposed rule change
(``Amendment No. 1'').\3\ The Commission is publishing this notice to
solicit comments on the proposed rule change, as amended, from
interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1, which supplemented the original filing, the
NSX provided more information regarding the certification process
and corrected a grammatical error.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to adopt NSX Rule 5.7 and accompanying
Interpretations and Policies .01 (Annual Compliance and Supervision
Certification) to require each Equity Trading Permit (``ETP'') Holder's
Chief Executive Officer (``CEO'') to certify annually to having in
place a process to establish, maintain, review, modify, and test
policies and procedures reasonably designed to achieve compliance with
applicable Rules of the Exchange, and federal securities laws and
regulations. The text of the proposed rule and interpretation is set
forth below. Proposed new language is italicized.
* * * * *

CHAPTER V.

SUPERVISION

* * * * *
Rule 5.7. Annual Certification of Compliance and Supervisory Processes
    Each ETP Holder shall have its chief executive officer (or
equivalent officer) certify annually, as set forth in

Interpretations and Policies .01, that the ETP Holder has in place
processes to establish, maintain, review, test and modify written
compliance policies and written supervisory procedures reasonably
designed to achieve compliance with applicable Rules of the Exchange
and federal securities laws and regulations.

Interpretations and Policies .01 Annual Compliance and Supervision
Certification

    The Exchange is issuing this interpretation to Rule 5.7, which
requires that the ETP Holder's chief executive officer (or equivalent
officer) execute annually a certification that the ETP Holder has in
place processes to establish, maintain, review, test and modify written
compliance policies and written supervisory procedures reasonably
designed to achieve compliance with applicable Rules of the Exchange
and federal securities laws and regulations. The certification for each
ensuing year shall be effected no later than on the anniversary date of
the previous year's certification. The certification shall state the
following:

Annual Compliance and Supervision Certification

    The undersigned is the chief executive officer (or equivalent
officer) of [name of ETP Holder corporation/partnership/sole
proprietorship] (the ``ETP Holder''). As required by Rule 5.7, the
undersigned makes the following certification:
    1. The ETP Holder has in place processes to:
    (a) Establish, maintain and review policies and procedures
reasonably designed to achieve compliance with applicable Rules of the
National Stock Exchange, Inc. and federal securities laws and
regulations;
    (b) Modify such policies and procedures as business, regulatory and
legislative changes and events dictate; and
    (c) Test the effectiveness of such policies and procedures on a
periodic basis, the timing and extent of which is reasonably designed
to ensure continuing compliance with Rules of the National Stock
Exchange, Inc. and federal securities laws and regulations.
    2. The undersigned chief executive officer (or equivalent officer)
has conducted one or more meetings with the chief compliance officer in
the preceding 12 months, the subject of which satisfy the obligations
set forth in Interpretations and Policies .01 to Rule 5.7.
    3. The ETP Holder's processes, with respect to paragraph 1 above,
are evidenced in a report reviewed by the chief executive officer (or
equivalent officer), chief compliance officer, and such other officers
as the ETP Holder may deem necessary to make this certification. The
final report has been submitted to the ETP Holder's board of directors
and audit committee or will be submitted to the ETP Holder's board of
directors and audit committee (or equivalent bodies) at the earlier of
their next scheduled meetings or within 45 days of the date of
execution of this certification.
    4. The undersigned chief executive officer (or equivalent officer)
has consulted with the chief compliance officer and other officers as
applicable (referenced in paragraph 3 above) and such other employees,
outside consultants, lawyers and accountants, to the extent deemed
appropriate, in order to attest to the statements made in this
certification.
* * * * *
    The Exchange provides the following guidance in completing the
Certification above. Included in the processes requirement is an
obligation on the part of the ETP Holder to conduct one or more
meetings annually between the chief executive officer (or equivalent
officer) and the chief compliance officer to: (1) Discuss and review
the matters that are subject of the certification; (2) discuss and
review the ETP Holder 's compliance efforts as of the date of such
meetings; and (3) identify and address significant compliance problems
and plans for emerging business areas.
    The report required in paragraph 3 of the certification must
document the ETP Holder's processes for establishing, maintaining,
reviewing, testing and modifying compliance policies, that are
reasonably designed to achieve compliance with applicable NSX rules and
federal securities laws and regulations, and any principal designated
by the ETP Holder may prepare the report. The report must be produced
prior to execution of the certification and be reviewed by the chief
executive officer (or equivalent officer), chief compliance officer and
any other officers the ETP Holder deems necessary to make the
certification and must be provided to the ETP Holder's board of
directors and audit committee in final form either prior to execution
of the certification or at the earlier of their next scheduled meetings
or within 45 days of execution of the certification. The report should
include the manner and frequency in which the processes are
administered, as well as the identification of officers and supervisors
who have responsibility for such administration. The report need not
contain any conclusions produced as a result of following the processes
set forth therein. The report may be combined with any other compliance
report or other similar report required by any other self-regulatory
organization provided that: (1) Such report is clearly titled in a
manner indicating that it is responsive to the requirements of the
certification and Rule 5.7; (2) an ETP Holder that submits a report for
review in response to a NSX request must submit the report in its
entirety; and (3) the ETP Holder makes such report in a timely manner,
i.e., annually.
* * * * *

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

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

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

1. Purpose
    It is critical that each NSX ETP Holder understand the importance
of employing comprehensive and effective compliance policies and
written supervisory procedures. Compliance with applicable NSX rules
and Federal securities laws and regulations is the foundation of
ensuring investor protection and market integrity and is essential to
the efficacy of self-regulation. Consequently, the Exchange is
proposing to adopt Rule 5.7, that would require ETP Holders to have
their CEOs, or equivalent officer, certify annually to having in place
processes to establish, maintain, review, modify, and test policies and
procedures reasonably designed to achieve compliance with applicable
NSX rules, and Federal securities laws and regulations.\4\
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    \4\ This new rule should not impose substantial new obligations
on NSX ETP Holders as the National Association of Securities
Dealers, Inc. (``NASD'') and the New York Stock Exchange LLC
(``NYSE'') have implemented similar rules. See NASD Rule 3013(b) and
Interpretative Material--3013 (``IM 3013'') (effective Dec. 1, 2004;
amendment to IM 3013 effective March 17, 2006); NYSE Rule 342.30
(effective Nov. 16, 2005). As a result, a similar requirement is
already in place for NASD and NYSE member firms, addressing member
firms' compliance with the rules of those self-regulatory
organizations. The first certifications pursuant to those rules were
due by April 1, 2006.

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    Specifically, the proposed rule change would require the CEO to
certify annually that senior executive management has in place
processes to: (1) Establish and maintain policies and procedures
reasonably designed to achieve compliance with applicable NSX rules and
Federal securities laws and regulations; (2) modify such policies and
procedures as business, regulatory and legislative changes and events
dictate; and (3) test the effectiveness of such policies and procedures
on a periodic basis, the timing of which is reasonably designed to
ensure continuing compliance with applicable NSX rules, and Federal
securities laws and regulations. The proposed rule change further would
require the CEO to certify that those processes are evidenced in a
report that has been reviewed by those executing the certification, as
well as the member's board of directors and audit committee. The
proposed rule change also would create a new Interpretation and Policy
.01 to Rule 5.7, which sets forth the language of the certification and
gives further guidance as to the requirements and limitations of the
rule.
    The proposed rule change states that included in this processes
requirement is an obligation on the part of the ETP Holder to conduct
one or more meetings annually between the CEO (or equivalent officer)
and the chief compliance officer to: (1) Discuss and review the matters
that are subject of the certification; (2) discuss and review the ETP
Holder's compliance efforts as of the date of such meetings; and (3)
identify and address significant compliance problems and plans for
emerging business areas. The CEO also may be the same person as the
chief compliance officer.
    As noted in the proposed rule change, the periodic and content
requirements for meetings between the CEO (or equivalent officer) and
the chief compliance officer, as well as the pertinent requirements of
paragraphs 3 and 4 of the certification, are intended to indicate the
unique and integral role of the chief compliance officer both in the
discharge of certain compliance processes and the reporting
requirements that are the subject matter of the certification and in
providing a reliable basis upon with the CEO can execute the
certification. The chief compliance officer is the primary advisor to
the ETP Holder on its overall compliance scheme and the particularized
rules, policies and procedures that the ETP Holder adopts. This is
because the chief compliance officer should have an expertise in the
process of: (1) Gaining an understanding of the products, services or
line functions that need to be the subject of written compliance
policies and written supervisory procedures; (2) identifying the
relevant rules, regulations, laws and standards of conduct pertaining
to such products, services or line functions based on experience and/or
consultation with those persons who have a technical expertise in such
areas of the ETP Holder's business; (3) developing, or advising other
business persons charged with the obligation to develop, policies and
procedures that are reasonably designed to achieve compliance with
those relevant rules, regulations, laws and standards of conduct; (4)
evidencing the supervision by the line managers who are responsible for
the execution of compliance policies; and (5) developing programs to
test compliance with the ETP Holder's policies and procedures.
    It is that expertise in the process of compliance that makes the
chief compliance officer an indispensable party to enable the CEO to
reach the conclusions stated in the certification. Consequently, any
certification made by a CEO under circumstances where the chief
compliance officer has concluded, after consultation, that there is an
inadequate basis for making such certification would be, without
limitation, conduct inconsistent with the observance of the high
standards of commercial honor, and the just and equitable principles of
trade--a violation of NSX Rule 3.1. Beyond the certification
requirement, it is the intention of both Rule 5.7 and Interpretations
and Policies .01 to foster regular and significant interaction between
senior management and the chief compliance officer regarding the ETP
Holder's comprehensive compliance program.
    The chief compliance officer and other compliance officers that
report to the chief compliance officer (as described in the sentence
that immediately follows) shall perform the compliance functions
contemplated under paragraphs 3 and 4 of the certification. Nothing
herein is intended to limit or discourage the participation of other
employees both within and outside the ETP Holder's compliance
department in any aspect of the ETP Holder's compliance programs or
processes, including those matters discussed herein. However, it is
understood that the chief compliance officer and, where applicable, the
most senior compliance officers having primary compliance department
responsibility for each of the ETP Holder's business segments, will
retain responsibility for the compliance functions contemplated by
paragraphs 3 and 4 of the certification.
    As may be necessary to render their views and advice, the chief
compliance officer and the other officers referenced in paragraph 3 of
the certification who consult with the CEO (or equivalent officer)
pursuant to paragraph 4, shall, in turn, consult with other employees,
officers, outside consultants, lawyers and accountants.
    The Exchange recognizes that supervisors with business line
responsibility are accountable for the discharge of an ETP Holder's
compliance policies and written supervisory procedures. The signatory
to the certification is certifying only as to having processes in place
to establish, maintain, review, test and modify the ETP Holder's
written compliance and supervisory policies and procedures and the
execution of this certification and any consultation rendered in
connection with such certification does not by itself establish
business line responsibility.
    The requirement that an ETP Holder's processes include providing
the report to the board of directors and audit committee (required by
paragraph 3 of the certification) does not apply to ETP Holders that do
not utilize these types of governing bodies and committees in the
conduct of their business.\5\
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    \5\ As a part of their process, ETP Holders must have the report
reviewed by their governing bodies and committees that serve similar
functions in lieu of a board of directors and audit committee.
---------------------------------------------------------------------------

    The report required in paragraph 3 of the certification must
document the ETP Holder's processes for establishing, maintaining,
reviewing, testing and modifying compliance policies, that are
reasonably designed to achieve compliance with applicable NSX rules and
Federal securities laws and regulations. Any principal designated by
the ETP Holder may prepare the report. The report must be produced
prior to execution of the certification and be reviewed by the CEO (or
equivalent officer), chief compliance officer and any other officers
the ETP Holder deems necessary to make the certification and must be
provided to the ETP Holder's board of directors and audit committee in
final form either prior to execution of the certification, at the
earlier of their next scheduled meetings or within 45 days of execution
of the certification. The report should include the manner and
frequency in which the processes are administered,

as well as the identification of officers and supervisors who have
responsibility for such administration. The report need not contain any
conclusions produced as a result of following the processes set forth
therein. The report may be combined with any other compliance report or
other similar report required by any other self-regulatory organization
provided that: (1) Such report is clearly titled in a manner indicating
that it is responsive to the requirements of the certification and Rule
5.7; (2) an ETP Holder that submits a report for review in response to
a NSX request must submit the report in its entirety; and (3) the ETP
Holder makes such report in a timely manner, for example, annually.
    In summary, this proposal recognizes that responsibility for
discharging compliance policies and written supervisory procedures
rests with business line supervisors. The proposal also clarifies that
execution of the certification does not by itself establish a signatory
as having such line supervisory responsibility. The proposal also sets
forth the particulars regarding the report that must evidence a
member's compliance processes. It states that the report must be
produced prior to execution of the certification and reviewed by the
CEO, and such other officers as the member deems necessary. The report
also must include the manner and frequency in which the processes are
administered and identify those officers and supervisors with
responsibility for such administration. The report need not contain
conclusions that result from following the specified processes, such as
compliance deficiencies. Additionally, the report may be combined with
other reports required by a self-regulatory organization, provided the
report is made annually, clearly indicates in the title that it
contains the information required by Rule 5.7, and that the entire
report is provided in response to any regulatory request for all or
part of the combined report. Finally, with respect to review of the
report, this clarifies that review by a member's board of directors and
audit committee only applies to those members whose corporate
governance structure have such or similar governing bodies and
committees--it does not impose a requirement that members create them
if they do not currently exist.
    ETP Holders should understand that the requirements of Rule 5.7 and
Interpretations and Policies .01 represent, in part, a principle-based
requirement to certify that the ETP Holder has in place processes to
establish, maintain, review, test and modify written compliance
policies and written supervisory procedures reasonably designed to
achieve compliance with applicable NSX rules and Federal securities
laws and regulations. Consequently, compliance with the periodic and
content requirements of the Interpretation pertaining to meetings
between the CEO (or equivalent officer) and the chief compliance
officer does not satisfy the full extent of these principle-based
obligations that will vary with the facts and circumstances of an ETP
Holder's business activities and organizational structure. Moreover,
NSX emphasizes the testing aspect of this principle-based requirement;
an integral purpose of NSX rules pertaining to supervision is that ETP
Holders adopt policies and procedures that are effective as to both the
scope of, and the achievement of compliance with, applicable NSX rules,
and Federal securities laws and regulations.
    NSX believes the proposal provides an effective mechanism to compel
substantial and purposeful interaction between senior management and
compliance personnel, thereby enhancing the quality of ETP Holders'
supervisory and compliance systems. NSX further believes the rule
change imposes the minimal additional burden on ETP Holders that is
necessary to achieve the proposal's purpose, as the firms are already
obligated to provide similar certifications in connection with rules of
other self-regulatory organizations.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\6\ in general, and furthers the
objectives of Section 6(b)(5) \7\ of the Act, in particular, in that it
is designed to promote just and equitable principles of trade, to
prevent fraudulent and manipulative acts and practices, and, in
general, to protect investors and the public interest. NSX believes
that that the proposed rule change is consistent with the provisions of
the Act noted above in that it will enhance focus on ETP Holders'
compliance and supervision systems, thereby decreasing the likelihood
of fraud and manipulative acts and increasing investor protection.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78(f)(b).
    \7\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change would
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

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

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

    Within 35 days of the 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 NSX consents, the Commission will:
    (A) By order approve the 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 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 Number SR-NSX-2006-16 on the subject line.

Paper Comments

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

All submissions should refer to File No. SR-NSX-2006-16. This file
number should be included in the subject line if e-mail is used. To
help the Commission process and review 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 inspection and
copying in the Commission's Public Reference Room. Copies of such
filings also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
file number SR-NSX-2006-16 and should be submitted on or before May 10,
2007.

    For the Commission by the Division of Market Regulation,
pursuant to the delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-7428 Filed 4-18-07; 8:45 am]

BILLING CODE 8010-01-P


[Federal Register: June 22, 2009 (Volume 74, Number 118)]
[Rules and Regulations]
[Page 29425-29427]
[DOCID:fr22jn09-7]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[Docket No. USCG-2009-0455]
RIN 1625-AA00

Safety Zone; Naval Training, San Clemente Island, CA

AGENCY: Coast Guard, DHS.

ACTION: Temporary final rule.

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SUMMARY: The Coast Guard is establishing a safety zone on the navigable
waters of the Pacific Ocean at the north end of San Clemente Island in
support of Naval Live Fire Training. This safety zone is necessary to
ensure non-authorized personnel and vessels remain safe by keeping
clear of the hazardous area during the training activity. Persons and
vessels are prohibited from entering into, transiting through, or
anchoring within this safety zone unless authorized by the Captain of
the Port (COTP) San Diego or his designated representative.

DATES: This rule is effective from June 6, 2009 through July 31, 2009.

ADDRESSES: Documents indicated in this preamble as being available in
the docket are part of docket USCG-2009-0455 and are available online
by going to http://www.regulations.gov, selecting the Advanced Docket
Search option on the right side of the screen, inserting USCG-2009-0455
in the Docket ID box, pressing Enter, and then clicking on the item in
the Docket ID column. They are also available for inspection or copying
at the Docket Management Facility (M-30), U.S. Department of
Transportation, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT: If you have questions on this
temporary rule, call or e-mail Petty Officer Kristen Beer, Waterways
Management, U.S. Coast Guard Sector San Diego, U.S. Coast Guard;
telephone<PHONE_NUMBER>,

e-mail<EMAIL_ADDRESS>If you have questions on viewing the
docket, call Renee V. Wright, Program Manager, Docket Operations,
telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Regulatory Information

    The Coast Guard is issuing this temporary final rule without prior
notice and opportunity to comment pursuant to authority under section
4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This
provision authorizes an agency to issue a rule without prior notice and
opportunity to comment when the agency for good cause finds that those
procedures are ``impracticable, unnecessary, or contrary to the public
interest.'' Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good
cause exists for not publishing a notice of proposed rulemaking (NPRM)
with respect to this rule because immediate action is necessary to
ensure the safety of commercial and recreational vessels in the
vicinity of any live fire training on the dates and times this rule
will be in effect and delay would be contrary to the public interest.
    For the same reasons, the Coast Guard also finds that good cause
exists under 5 U.S.C. 553(d)(3) for making this rule effective less
than 30 days after publication in the Federal Register. Any delay in
the effective date of this rule would expose mariners to the dangers
posed by the training.

Background and Purpose

    U.S. Naval forces will be conducting intermittent training
involving live fire exercises throughout June and July 2009. This
safety zone is necessary to ensure non-authorized personnel and vessels
remain safe by keeping clear of the hazardous area during the training
activity.

Discussion of Rule

    The Coast Guard is establishing a safety zone that will be enforced
from June 6, 2009 through July 31, 2009. The limits of the safety zone
will be the navigable waters of the Pacific Ocean at the north end of
San Clemente Island bounded by lines connecting the following
coordinates: Beginning at 33[deg]01.09' N, 118[deg]36.34' W; thence to
32[deg]59.95' N, 118[deg]39.77' W; thence running parallel to the
shoreline at a distance of approximately 3 NM to 33[deg]02.81' N,
118[deg]30.65' W; thence to 33[deg]01.29' N, 118[deg]33.88' W; thence
along the shoreline returning to 33[deg]01.09' N, 118[deg]36.34' W (NAD
83).
    This safety zone is necessary to ensure non-authorized personnel
and vessels remain safe by keeping clear of the hazardous area during
the training activities. Persons and vessels are prohibited from
entering into, transiting through, or anchoring within this safety zone
unless authorized by the Captain of the Port, or his designated
representative.

Regulatory Analyses

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

Regulatory Planning and Review

    This rule is not a significant regulatory action under section 3(f)
of Executive Order 12866, Regulatory Planning and Review, and does not
require an assessment of potential costs and benefits under section
6(a)(3) of that Order. The Office of Management and Budget has not
reviewed it under that Order.
    We expect the economic impact of this rule to be so minimal that a
full Regulatory Evaluation is unnecessary. This determination is based
on the size and location of the safety zone. Commercial and
recreational vessels will not be allowed to transit through the
designated safety zone during specified times of training.

Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have
considered whether this rule would have a significant economic impact
on a substantial number of small entities. The term ``small entities''
comprises small businesses, not-for-profit organizations that are
independently owned and operated and are not dominant in their fields,
and governmental jurisdictions with populations of less than 50,000.
    The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will
not have a significant economic impact on a substantial number of small
entities.
    This rule will affect the following entities, some of which may be
small entities: The owners or operators of vessels intending to transit
or anchor in a portion of the Pacific Ocean on the north end of San
Clemente Island from June 6, 2009 until July 31, 2009.
    This safety zone will not have a significant economic impact on a
substantial number of small entities for the following reasons: This
rule will be enforced only during naval training exercises. Vessel
traffic can pass safely around the zone. Traffic will be allowed to
pass through the zone with the permission of the U.S. Navy or U.S.
Coast Guard. Before the effective period, the Coast Guard will issue
broadcast notice to mariners (BNM) alerts.

Assistance for Small Entities

    Under section 213(a) of the Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104-121), we offer to assist small
entities in understanding the rule so that they can better evaluate its
effects on them and participate in the rulemaking process.
    Small businesses may send comments on the actions of Federal
employees who enforce, or otherwise determine compliance with, Federal
regulations to the Small Business and Agriculture Regulatory
Enforcement Ombudsman and the Regional Small Business Regulatory
Fairness Boards. The Ombudsman evaluates these actions annually and
rates each agency's responsiveness to small business. If you wish to
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR
(1-888-734-3247). The Coast Guard will not retaliate against small
entities that question or complain about this rule or any policy or
action of the Coast Guard.

Collection of Information

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

Federalism

    A rule has implications for Federalism under Executive Order 13132,
Federalism, if it has a substantial direct effect on State or local
governments and would either preempt State law or impose a substantial
direct cost of compliance on them. We have analyzed this rule under
that Order and have determined that it does not have implications for
Federalism.

Unfunded Mandates Reform Act

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

Taking of Private Property

    This rule will not effect a taking of private property or otherwise
have taking implications under Executive

Order 12630, Governmental Actions and Interference with
Constitutionally Protected Property Rights.

Civil Justice Reform

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

Protection of Children

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

Indian Tribal Governments

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

Energy Effects

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

Technical Standards

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

Environment

    We have analyzed this rule under Department of Homeland Security
Management Directive 023-01 and Commandant Instruction M16475.lD, which
guide the Coast Guard in complying with the National Environmental
Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have concluded
this action is one of a category of actions which do not individually
or cumulatively have a significant effect on the human environment.
This rule is categorically excluded, under figure 2-1, paragraph
(34)(g), of the Instruction because this rule involves the
establishment of a safety zone.
    An environmental analysis checklist and a categorical exclusion
determination are available in the docket where indicated under
ADDRESSES.

List of Subjects in 33 CFR Part 165

    Harbors, Marine safety, Navigation (water), Reporting and
recordkeeping requirements, Security measures, Waterways.

0
For the reasons discussed in the preamble, the Coast Guard amends 33
CFR part 165 as follows:

PART 165--REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS

0
1. The authority citation for part 165 continues to read as follows:

    Authority:  33 U.S.C. 1226, 1231; 46 U.S.C. Chapter 701, 3306,
3703; 50 U.S.C. 191, 195; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5;
Pub. L. 107-295; 116 Stat. 2064; Department of Homeland Security
Delegation No. 0170.1.

0
2. Add a new temporary section Sec.  165.T11-200 to read as follows:

Sec.  165.T11-200   Safety zone; Naval Training, San Clemente Island,
CA.

    (a) Location. The following area is a safety zone: All navigable
waters of the Pacific Ocean, from surface to bottom, at the north end
of San Clemente Island bounded by lines connecting the following
points: Beginning at 33[deg]01.09' N, 118[deg]36.34' W; thence to
32[deg]59.95' N, 118[deg]39.77' W; thence running parallel to the
shoreline at a distance of approximately 3 NM to 33[deg]02.81' N,
118[deg]30.65' W; thence to 33[deg]01.29' N, 118[deg]33.88' W; thence
along the shoreline returning to 33[deg]01.09' N, 118[deg]36.34' W.
These coordinates are based on NAD 83.
    (b) Effective Period. This section is effective from June 6, 2009
through July 31, 2009. If naval training exercises are concluded prior
to the scheduled termination of the effective period, the COTP will
cease enforcement of this safety zone and will announce that fact via
Broadcast Notice to Mariners.
    (c) Definitions. The following definitions apply to this section:
Designated representative, means any Commissioned, Warrant, or Petty
Officers of the Coast Guard, or Coast Guard Auxiliary, and local,
state, and federal law enforcement officers who have been authorized to
act on the behalf of the COTP; non-authorized personnel and vessels,
means any civilian boats, fishermen, divers, and swimmers.
    (d) Regulations. (1) Under the general regulations in Sec.  165.23,
entry into, transit through or anchoring within this safety zone is
prohibited unless authorized by the COTP San Diego or his designated
representative.
    (2) Non-authorized personnel and vessels requesting permission to
transit through the safety zone may request authorization to do so from
the COTP San Diego or his designated representative. They may be
contacted on VHF-FM Channel 16, or at telephone number<PHONE_NUMBER>.
    (3) Naval units involved in the exercise are allowed within the
safety zone.
    (4) All persons and vessels shall comply with the instructions of
the Coast Guard COTP or his designated representative.
    (5) Upon being hailed by U.S. Coast Guard or other official
personnel by siren, radio, flashing light, or other means, the operator
of a vessel shall proceed as directed.
    (6) The Coast Guard may be assisted by other Federal, State, or
local agencies including the U.S. Navy.

    Dated: June 4, 2009.
T.H. Farris,
Captain, U.S. Coast Guard, Captain of the Port San Diego.
[FR Doc. E9-14557 Filed 6-19-09; 8:45 am]

BILLING CODE 4910-15-P