[Federal Register Volume 87, Number 81 (Wednesday, April 27, 2022)]
[Notices]
[Pages 25065-25069]
[FR Doc No: 2022-08911]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94773; File No. SR-ISE-2022-10]

Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing
of Proposed Rule Change To Amend ISE Options 4, Section 5, Series of
Options Contracts Open for Trading

April 21, 2022.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on April 11, 2022, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I and II below, which Items have been
prepared by the Exchange. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend Options 4, Section 5, ``Series of
Options Contracts Open for Trading.'' Specifically, this proposal seeks
to amend Supplementary Material .07 to Options 4, Section 5.
    The text of the proposed rule change is available on the Exchange's
website at https://listingcenter.nasdaq.com/rulebook/ise/rules, at the
principal office of the Exchange, and at the Commission's Public
Reference Room.

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

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

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

1. Purpose
    The Exchange proposes to amend Options 4, Section 5, ``Series of
Options Contracts Open for Trading.'' Specifically, the Exchange
proposes to amend Supplementary Material .07 to Options 4, Section 5 to
account for conflicts between different provisions within the Short
Term Options Series Rules.
    In 2021, ISE amended Options 4, Section 5 to limit the intervals
between strikes in equity options listed as part of the Short Term
Option Series Program, excluding Exchange-Traded Fund Shares and ETNs,
that have an expiration date more than twenty-one days from the listing
date (``Strike Interval Proposal'').\3\ The Strike Interval Proposal
adopted a new Supplementary Material .07 to Options 4, Section 5 which
included a table that intended to

specify the applicable strike intervals that would supersede
Supplementary Material .03(e) \4\ for Short Term Option Series in
equity options, excluding Exchange-Traded Fund Shares and ETNs, which
have an expiration date more than twenty-one days from the listing
date. The Strike Interval Proposal was designed to reduce the density
of strike intervals that would be listed in later weeks, within the
Short Term Options Series Program, by utilizing limitations for
intervals between strikes which have an expiration date more than
twenty-one days from the listing date.
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    \3\ See Securities Exchange Act Release No. 91930 (May 18,
2021), 86 FR 27907 (May 24, 2021) (SR-ISE-2021-09) (Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend Options
4, Section 5, ``Series of Options Contracts Open for Trading'' To
Limit Short Term Options Series Intervals Between Strikes).
    \4\ Supplementary Material .03(e) of Options 4, Section 5
states, ``Strike Interval. During the month prior to expiration of
an option class that is selected for the Short Term Option Series
Program pursuant to this Rule (``Short Term Option''), the strike
price intervals for the related non-Short Term Option (``Related
non-Short Term Option'') shall be the same as the strike price
intervals for the Short Term Option. The Exchange may open for
trading Short Term Option Series on the Short Term Option Opening
Date that expire on the Short Term Option Expiration Date at strike
price intervals of (i) $0.50 or greater where the strike price is
less than $100, and $1 or greater where the strike price is between
$100 and $150 for all option classes that participate in the Short
Term Options Series Program; (ii) $0.50 for option classes that
trade in one dollar increments and are in the Short Term Option
Series Program; or (iii) $2.50 or greater where the strike price is
above $150.''
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    At this time, the Exchange proposes to amend the rule text within
Supplementary Material .07 to Options 4, Section 5 to clarify the
current rule text and amend the application of the table to account for
potential conflicts within the Short Term Options Series Rules.
Currently, the table within Supplementary Material .07 to Options 4,
Section 5 is as follows: \5\
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    \5\ The Share Price would be the closing price on the primary
market on the last day of the calendar quarter and the Average Daily
Volume would be the total number of options contracts traded in a
given security for the applicable calendar quarter divided by the
number of trading days in the applicable calendar quarter The
Average Daily Volume would be the total number of options contracts
traded in a given security for the applicable calendar quarter
divided by the number of trading days in the applicable calendar
quarter. Beginning on the second trading day in the first month of
each calendar quarter, the Average Daily Volume shall be calculated
by utilizing data from the prior calendar quarter based on Customer-
cleared volume at The Options Clearing Corporation. For options
listed on the first trading day of a given calendar quarter, the
Average Daily Volume shall be calculated using the quarter prior to
the last trading calendar quarter. See Supplementary Material .07 to
Options 4, Section 5.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Share price
                                           -------------------------------------------------------------------------------------------------------------
                   Tier                                                                     $25 to less     $75 to less    $150 to less       $500 or
                                                Average daily volume       Less than $25     than $75        than $150       than $500        greater
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.........................................  Greater than 5,000..........           $0.50           $1.00           $1.00           $5.00           $5.00
2.........................................  Greater than 1,000 to 5,000.            1.00            1.00            1.00            5.00           10.00
3.........................................  0 to 1,000..................            2.50            5.00            5.00            5.00           10.00
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The first sentence of Supplementary Material .07 to Options 4,
Section 5 provides, ``With respect to listing Short Term Option Series
in equity options, excluding Exchange-Traded Fund Shares and ETNs,
which have an expiration date more than twenty-one days from the
listing date, the following table will apply as noted within
Supplementary Material .03(e).''
    First, the Exchange proposes to amend the first sentence of
Supplementary Material .07 to instead provide, ``With respect to
listing Short Term Option Series in equity options, excluding Exchange-
Traded Fund Shares and ETNs, which have an expiration date more than
twenty-one days from the listing date, the following table, which
specifies the applicable interval for listing, will apply as noted
within Supplementary Material .03(f).'' The table within Supplementary
Material .07 provides for the listing of intervals based on certain
parameters (average daily volume and share price). The Exchange
proposes to add the phrase ``which specifies the applicable interval
for listing'' to make clear that the only permitted intervals are as
specified in the table within Supplementary Material .07, except in the
case where Supplementary Material .03(e) provides for a greater
interval as described in more detail below.
    Second, the Exchange proposes to amend the first sentence of
Supplementary Material .07 to cite to Supplementary Material .03(f) \6\
instead of .03(e) \7\ as paragraph (f) indicates when the table within
Supplementary Material .07 applies.
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    \6\ Supplementary Material .03(f) of Options 4, Section 5
provides, ``Notwithstanding (e) above, when Short Term Options
Series in equity options, excluding Exchange-Traded Funds (``ETFs'')
and ETNs, have an expiration more than twenty-one days from the
listing date, the strike interval for each options class shall be
based on the table within Supplementary Material .07.''
    \7\ Supplementary Material .03(e) of Options 4, Section 5,
provides, ``Strike Interval. During the month prior to expiration of
an option class that is selected for the Short Term Option Series
Program pursuant to this Rule (``Short Term Option''), the strike
price intervals for the related non-Short Term Option (``Related
non-Short Term Option'') shall be the same as the strike price
intervals for the Short Term Option. The Exchange may open for
trading Short Term Option Series on the Short Term Option Opening
Date that expire on the Short Term Option Expiration Date at strike
price intervals of (i) $0.50 or greater where the strike price is
less than $100, and $1 or greater where the strike price is between
$100 and $150 for all option classes that participate in the Short
Term Options Series Program; (ii) $0.50 for option classes that
trade in one dollar increments and are in the Short Term Option
Series Program; or (iii) $2.50 or greater where the strike price is
above $150.''
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    Third, the Exchange proposes to add a new sentence within
Supplementary Material .07 to Options 4, Section 5 which states, ``To
the extent there is a conflict between applying Supplementary Material
.03(e) and the below table, the greater interval would apply.'' Today,
there are instances where a conflict is presented as between the
application of the table within Supplementary Material .07 and the rule
text within Supplementary Material .03(e) with respect to the correct
interval. Adding the proposed sentence would make clear to Members the
applicable intervals where there is a conflict between the rule text
within Supplementary Material .07 and the rule text within
Supplementary Material .03(e), thereby providing certainty as to the
outcome. The Exchange proposes to insert the words ``greater than''
because it proposes to permit Supplementary Material .03(e) of Options
4, Section 5 to govern only in the event that the interval would be
greater. The same analysis would not be conducted where the result
would be a lesser interval. By way of example,
    Example 1: Assume a Tier 1 stock that closed on the last day of Q1
with a quarterly share price less than $150. Next, assume during Q2 the
share price rose above $150. Utilizing the table within Supplementary
Material .07, the interval would be $1.00 even though the price rose
above $150 because the Share Price was calculated utilizing data from
the prior calendar quarter. Utilizing Supplementary Material .03(e),
the interval would be $2.50 if the price rose above $150. The greater
interval would then be $2.50 as per Supplementary Material .03(e) in
this scenario. Therefore, the following strikes would

be eligible to list: $152.5 and $157.5. For strikes less than $150, the
following strikes would be eligible to list: $149 and $148 because
Short Term Options Series with expiration dates more than 21 days from
the listing date as well as Short Term Options Series with expiration
dates less than 21 days from the listing date would both be eligible to
list $1 intervals pursuant to Supplementary Material .07 and
Supplementary Material .03(e) of Options 5, Section 4.
    Example 2: Assume a Tier 2 stock that closed on the last day of Q1
with a quarterly share price less than $25. Next, assume during Q2 the
share price rose above $100. Utilizing the table within Supplementary
Material .07 the interval would be $1.00 even though the price rose
above $100 because the Share Price was calculated utilizing data from
the prior calendar quarter. Utilizing Supplementary Material .03(e),
the interval would be $1.00 if the price rose above $100. The $1
interval is the same in both cases in this scenario and therefore there
is no conflict. Now assume during the quarter the price rose above
$150. Utilizing the table within Supplementary Material .07, the
interval would continue to be $1.00 because the Share Price relied on
data from the prior calendar quarter, however, pursuant to
Supplementary Material .03(e), the interval would be $2.50. The greater
interval would then be $2.50 as per Supplementary Material .03(e) in
this scenario.
    Example 3: Assume a Tier 3 stock that closed on the last day of Q1
with a quarterly share price less than $25. Next, assume during Q2 the
share price rose above $100. Utilizing the table within Supplementary
Material .07 the interval would be $2.50 even though the price rose
above $100 because the Share Price relied on data from the prior
calendar quarter. Utilizing Supplementary Material .03(e), the interval
would be $1.00 if the price rose above $100. The greater interval would
then be $2.50 as per the table in Supplementary Material .07 in this
scenario.
    Fourth, the Exchange proposes to delete the last sentence of the
first paragraph of Supplementary Material .07 to Options 4, Section 5
which states, ``The below table indicates the applicable strike
intervals and supersedes Supplementary Material .03(d) which permits
additional series to be opened for trading on the Exchange when the
Exchange deems it necessary to maintain an orderly market, to meet
customer demand or when the market price of the underlying security
moves substantially from the exercise price or prices of the series
already opened.'' The table within Supplementary Material .07 impacts
strike intervals, while Supplementary Material .03(d) \8\ describes
adding series of options. The table within Supplementary Material .07
supersedes other rules pertaining to strike intervals, but the table
does not supersede rules governing the addition of options series.
Therefore, the table within Supplementary Material .07 and
Supplementary Material .03(d) do not conflict with each other. Deleting
the reference to Supplementary Material .03(d) will avoid confusion.
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    \8\ Supplementary Material .03(d) of Options 5, Section 4
provides, ``Additional Series. If the Exchange opens less than
thirty (30) Short Term Option Series for a Short Term Option
Expiration Date, additional series may be opened for trading on the
Exchange when the Exchange deems it necessary to maintain an orderly
market, to meet customer demand or when the market price of the
underlying security moves substantially from the exercise price or
prices of the series already opened.''
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    Fifth, and finally, the Exchange provides within the last sentence
of Supplementary Material .07 to Options 4, Section 5 that,
``Notwithstanding the limitations imposed by Supplementary Material
.07, this proposal does not amend the range of strikes that may be
listed pursuant to Supplementary Material .03, regarding the Short Term
Option Series Program.'' The Exchange proposes to remove this rule
text. While the range limitations continue to be applicable to the
table within Supplementary Material .07, the strike ranges do not
conflict with strike intervals and therefore the sentence is not
necessary. Removing the last sentence of Supplementary Material .07 to
Options 4, Section 5 will avoid confusion. Also, the rule text within
Supplementary Material .03(f) of Options 5, Section 4 otherwise
indicates when Supplementary Material .07 would apply.
Implementation
    The Exchange proposes to implement this rule change on August 1,
2022. The Exchange will issue an Options Trader Alert to notify Members
of the implementation date.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\9\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\10\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest. The Strike Proposal continues to limit the intervals between
strikes listed in the Short Term Options Series Program that have an
expiration date more than twenty-one days.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(5).
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    The Exchange's proposal to add clarifying language to the first
sentence of Supplementary Material .07 of Options 4, Section 5, is
consistent with the Act because it will make clear that the only
permitted intervals are as specified in the table within Supplementary
Material .07, except in the case where Supplementary Material .03(e)
provides for a greater interval. This amendment will bring greater
transparency to the rule.
    Amending the first sentence of Supplementary Material .07 to cite
to Supplementary Material .03(f) instead of .03(e) is consistent with
the Act because paragraph (f) indicates when the table within
Supplementary Material .07 applies.
    Adopting a new sentence within Supplementary Material .07 of
Options 4, Section 5 to address a potential conflict between the Short
Term Options Series Program rules, specifically as between the
application of the table within Supplementary Material .07 and the rule
text within Supplementary Material .03(e), with respect to the correct
interval is consistent with the Act. The table within Supplementary
Material .07 supersedes other strike interval rules, but does not
supersede the addition of option series. Therefore, these rules do not
conflict with the table. Deleting the reference to Supplementary
Material .03(d) will avoid confusion. This new rule text will make
clear to Members the applicable intervals when there is a conflict
between the rule text within Supplementary Material .07 and the rule
text within Supplementary Material .03(e), thereby providing certainty
as to the outcome. The proposed new rule text promotes just and
equitable principles of trade by adding transparency to the manner in
which ISE implements its listing rules, and protects investors and the
general public by removing uncertainty.
    Removing the last sentence of the first paragraph of Supplementary
Material .07 to Options 4, Section 5 is consistent with the Act because
the table within Supplementary Material .07 impacts strike intervals,
while Supplementary Material .03(d) describes the addition of options
series. The table within Supplementary Material .07 supersedes other
rules pertaining to strike intervals, but the table does not supersede
rules governing the addition of options series.

Therefore, the table within Supplementary Material .07 and
Supplementary Material .03(d) do not conflict with each other. Deleting
the reference to Supplementary Material .03(d) will avoid confusion.
    Removing the last sentence of Supplementary Material .07 to Options
4, Section 5 is consistent with the Act because while the range
limitations continue to be applicable, the strike ranges do not
conflict with strike intervals, rendering the sentence unnecessary.
Removing the last sentence of Supplementary Material .07 to Options 4,
Section 5 will avoid confusion. Also, the rule text within
Supplementary Material .03(f) of Options 5, Section 4 otherwise
indicates when Supplementary Material .07 would apply.
    The Strike Interval Proposal was designed to reduce the density of
strike intervals that would be listed in later weeks, within the Short
Term Options Series Program, by utilizing limitations for intervals
between strikes which have an expiration date more than twenty-one days
from the listing date. The Exchange's proposal intends to continue to
remove certain strike intervals where there exist clusters of strikes
whose characteristics closely resemble one another and, therefore, do
not serve different trading needs,\11\ rendering these strikes less
useful. Also, the Strike Interval Proposal continues to reduce the
number of strikes listed on ISE, allowing Lead Market Makers and Market
Makers to expend their capital in the options market in a more
efficient manner, thereby improving overall market quality on ISE.
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    \11\ For example, two strikes that are densely clustered may
have the same risk properties and may also be the same percentage
out-of-the money.
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    Additionally, by making clear that the greater interval would
control as between the rule text within Supplementary Material .07 and
the rule text within Supplementary Material .03(e), the Exchange is
reducing the number of strikes listed in a manner consistent with the
intent of the Strike Interval Proposal, which was to reduce strikes
which were farther out in time. The result of this clarification is to
select wider strike intervals for Short Term Option Series in equity
options which have an expiration date more than twenty-one days from
the listing date. This rule change would harmonize strike intervals as
between inner weeklies (those having less than twenty-one days from the
listing date) and outer weeklies (those having more than twenty-one
days from the listing date) so that strike intervals are not widening
as the listing date approaches.

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

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The Strike Interval Proposal
continues to limit the number of Short Term Options Series Program
strike intervals available for quoting and trading on ISE for all ISE
Participants.
    Adding clarifying language to the first sentence of Supplementary
Material .07 of Options 4, Section 5 to make clear which parameter the
table within Supplementary Material .07 of Options 4, Section 5 amends
within the Short Term Options Series Program will bring greater
transparency to the rules. Amending the first sentence of Supplementary
Material .07 to cite to Supplementary Material .03(f) instead of .03(e)
does not impose an undue burden on competition because paragraph (f)
indicates when the table within Supplementary Material .07 applies.
Adopting a new sentence to address potential conflicts as between the
rule text within Supplementary Material .07 and the rule text within
Supplementary Material .03(e) of Options 4, Section 5, within the Short
Term Options Series Program, will bring greater transparency to the
manner in which ISE implements its listing rules. The table within
Supplementary Material .07 impacts strike intervals, while
Supplementary Material .03(d) describes adding series of options. The
table within Supplementary Material .07 supersedes other strike
interval rules, but does not supersede the addition of series. Removing
the last sentence of the first paragraph of Supplementary Material .07
to Options 4, Section 5 does not impose an undue burden on competition
because the table within Supplementary Material .07 supersedes other
rules pertaining to strike intervals, but the table does not supersede
rules governing the addition of options series. Also, deleting the
reference to Supplementary Material .03(d) will avoid confusion.
Finally, removing the last sentence of Supplementary Material .07 to
Options 4, Section 5 will remove any potential confusion. While the
range limitations continue to be applicable, the strike ranges do not
conflict with strike intervals and are not necessary.
    While this proposal continues to limit the intervals of strikes
listed on ISE, the Exchange continues to balance the needs of market
participants by continuing to offer a number of strikes to meet a
market participant's investment objective. The Exchange's Strike
Interval Proposal does not impose an undue burden on inter-market
competition as this Strike Interval Proposal does not impact the
listings available at another self-regulatory organization.

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

    No written comments were either solicited or received.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate 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 Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-ISE-2022-10 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-ISE-2022-10. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (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 website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-ISE-2022-10, and should be submitted on
or before May 18, 2022.
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    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-08911 Filed 4-26-22; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 78, Number 46 (Friday, March 8, 2013)]
[Notices]
[Pages 15075-15076]
[FR Doc No: 2013-05454]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69030; File No. SR-NASDAQ-2013-032]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing of Proposed Rule Change To Require That Listed
Companies Have an Internal Audit Function

March 4, 2013.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on February 20, 2013, The NASDAQ Stock Market LLC (``Nasdaq'' 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. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to require that listed companies establish
and maintain an internal audit function. The text of the proposed rule
change is below. Proposed new language is in italics.\3\
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    \3\ Changes are marked to the rule text that appears in the
electronic manual of Nasdaq found at http://nasdaqomx.cchwallstreet.com.
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* * * * *

5645. Internal Audit Function

    Each Company must establish and maintain an internal audit function
to provide management and the audit committee with ongoing assessments
of the Company's risk management processes and system of internal
control. The Company may choose to outsource this function to a third
party service provider other than its independent auditor. The audit
committee must meet periodically with the internal auditors (or other
personnel responsible for this function) and assist the Board in its
oversight of the performance of this function. The audit committee
should also discuss with the outside auditor the responsibilities,
budget and staffing of the internal audit function.
    A Company listed on Nasdaq on or before June 30, 2013, must
establish an internal audit function by no later than December 31,
2013. A Company listed after June 30, 2013, must establish an internal
audit function prior to listing.
* * * * *

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

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

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

1. Purpose
    Nasdaq proposes to adopt a new rule to require all listed companies
to establish and maintain an internal audit function.\4\ The purpose of
the rule is to ensure that listed companies have a mechanism in place
to regularly review and assess their system of internal control and,
thereby, to identify any weaknesses and develop appropriate remedial
measures. The rule is also intended to make sure that the listed
company's management and audit committee are provided with ongoing
information about risk management processes and the system of internal
control. Nasdaq also believes that the rule will assist listed
companies' efforts to comply with their obligations under federal
securities law, including but not limited to Rules 13a-15 and 15d-15
under the Act, which require most companies to maintain and to
evaluate, with the participation of their principal executive and
principal financial officers, or persons performing similar functions,
the effectiveness of the internal control over financial reporting.\5\
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    \4\ The New York Stock Exchange, in Listed Company Manual
Section 303A.07(c), has a similar requirement.
    \5\ 17 CFR 240.13a-15 and 240.15d-15.
---------------------------------------------------------------------------

    To preserve flexibility, listed companies may choose to outsource
this function to a third party service provider other than their
independent auditor. However, in all instances, the audit committee has
sole responsibility to oversee the internal audit function and cannot
allocate or delegate this responsibility to another board committee.

    Finally, while Nasdaq believes that, consistent with best
practices, many listed companies have already established and
implemented an internal audit function, to allow sufficient time for
companies that have not yet done so, each company listed on Nasdaq on
or before June 30, 2013, will be required to establish an internal
audit function by no later than December 31, 2013. Companies listed
after June 30, 2013, will be required to establish an internal audit
function prior to listing.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\6\ in general and with Section
6(b)(5) of the Act,\7\ in particular in that it is 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
securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and, in general, to
protect investors and the public interest. The proposed rule change
will require listed companies to establish and maintain an internal
audit function. It is intended to ensure that listed companies have a
mechanism in place to regularly review and assess their system of
internal control and, thereby, to identify any weaknesses and develop
appropriate remedial measures. It is also intended to make sure that
management and the audit committee are provided with ongoing
information about the company's risk management processes and system of
internal control. As such, it is designed to protect investors and the
public interest.
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    \6\ 15 U.S.C. 78f.
    \7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    Nasdaq does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act, as amended. In this regard,
Nasdaq notes that the competition among exchanges for listings is
robust and vigorous, and the proposed rule change is not intended, nor
is it expected, to reduce or diminish such competition.

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

    Written comments were neither solicited nor received.

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 Exchange consents, the Commission shall: (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 Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NASDAQ-2013-032 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-NASDAQ-2013-032. This
file number should be included on the subject line if email is used.
    To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments,
all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for Web site
viewing and printing in the Commission's Public Reference Room on
official business days between the hours of 10:00 a.m. and 3:00 p.m.
Copies of the filing also will be available for inspection and copying
at the principal office of the Exchange. All comments received will be
posted without change; the Commission does not edit personal
identifying information from submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NASDAQ-2013-032, and should be submitted
on or before March 29, 2013.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-05454 Filed 3-7-13; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 76, Number 74 (Monday, April 18, 2011)]
[Proposed Rules]
[Page 21692]
[FR Doc No: 2011-9287]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 63

[EPA-HQ-OAR-2004-0305; FRL-9296-6]
RIN 2060-AQ43

National Emission Standards for Hazardous Air Pollutants: Primary
Lead Smelting

AGENCY: Environmental Protection Agency (EPA).

ACTION: Extension of public comment period.

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

SUMMARY: On February 17, 2011, EPA proposed amendments to the National
Emission Standards for Hazardous Air Pollutants for Primary Lead
Smelting (76 FR 9410). The EPA is extending the deadline for written
comments on the proposed amendments by 19 days to May 8, 2011. The EPA
received a request for this extension from the Doe Run Company, the
sole covered facility. Doe Run Company requested the extension in order
to analyze data and review the proposed amendments. EPA finds this
request to be reasonable due to the significant changes the proposal
would make to the current rule.

DATES: Comments must be received on or before May 8, 2011.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2004-0305, by one of the following methods:
     http://www.regulations.gov: Follow the online instructions
for submitting comments.
     E-mail<EMAIL_ADDRESS>Attention Docket ID Number
EPA-HQ-OAR-2004-0305.
     Fax:<PHONE_NUMBER>. Attention Docket ID Number EPA-HQ-
OAR-2004-0305.
     Mail: U.S. Postal Service, send comments to: EPA Docket
Center (6102T), EPA West (Air Docket), Attention Docket ID Number EPA-
HQ-OAR-2004-0305, U.S. Environmental Protection Agency, Mailcode 2822T,
1200 Pennsylvania Ave., NW., Washington, DC 20460. Please include a
total of two copies. In addition, please mail a copy of your comments
on the information collection provisions to the Office of Information
and Regulatory Affairs, Office of Management and Budget, Attn: Desk
Officer for EPA, 725 17th St., NW., Washington, DC 20503.
     Hand Delivery: U.S. Environmental Protection Agency, EPA
West (Air Docket), Room 3334, 1301 Constitution Avenue, NW.,
Washington, DC 20004, Attention Docket ID Number EPA-HQ-OAR-2004-0305.
Such deliveries are only accepted during the Docket's normal hours of
operation, and special arrangements should be made for deliveries of
boxed information. Please include a total of two copies.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2004-0305. EPA's policy is that all comments received will be included
in the public docket without change and may be made available online at
http://www.regulations.gov, including any personal information
provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site
is an ``anonymous access'' system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment. If you send an e-mail comment directly to EPA without
going through http://www.regulations.gov, your e-mail address will be
automatically captured and included as part of the comment that is
placed in the public docket and made available on the Internet. If you
submit an electronic comment, EPA recommends that you include your name
and other contact information in the body of your comment and with any
disk or CD-ROM you submit. If EPA cannot read your comment due to
technical difficulties and cannot contact you for clarification, EPA
may not be able to consider your comment. Electronic files should avoid
the use of special characters, any form of encryption, and be free of
any defects or viruses.
    Docket: All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some
information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in hard copy.
Publicly available docket materials are available either electronically
in http://www.regulations.gov or in hard copy at the EPA Docket Center,
EPA West, Room 3334, 1301 Constitution Ave., NW., Washington, DC. The
Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through
Friday, excluding legal holidays. The telephone number for the Public
Reading Room is<PHONE_NUMBER>, and the telephone number for the Docket
Center is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Questions concerning the proposed rule
should be addressed to Mr. Nathan Topham, Office of Air Quality
Planning and Standards, Sector Policies and Programs Division, Metals
and Inorganic Chemicals Group (D243-02), Environmental Protection
Agency, Research Triangle Park, NC 27711, telephone number: (919) 541-
0483; fax number:<PHONE_NUMBER>; e-mail address:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: For the reasons noted above, the public
comment period will now end on May 8, 2011.

How can I get copies of the proposed rule and other related
information?

    The proposed rule titled, National Emission Standards for Hazardous
Air Pollutants: Primary Lead Smelting, was published February 17, 2011
(76 FR 9410). EPA has established the public docket for the proposed
rulemaking under docket ID No. EPA-HQ-OAR-2004-0305, and a copy of the
proposed rule is available in the docket. We note that, since the
proposed rule was published, additional materials have been added to
the docket. Information on how to access the docket is presented above
in the ADDRESSES section.

    Dated: April 12, 2011.
Gina McCarthy,
Assistant Administrator, Office of Air and Radiation.
[FR Doc. 2011-9287 Filed 4-15-11; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register: August 3, 2007 (Volume 72, Number 149)]
[Notices]
[Page 43306-43307]
[DOCID:fr03au07-108]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56155; File No. SR-ISE-2007-67]

Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change Relating to Directed Orders System Change

July 27, 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 July 24, 2007, the International Securities Exchange, LLC
(``ISE'' 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 substantially
prepared by the ISE. The proposed rule change has been filed by the ISE
as effecting a change in an existing order-entry or trading system
pursuant to section 19(b)(3)(A) of the Act,\3\ and Rule 19b-4(f)(5)
thereunder,\4\ which renders the proposal effective upon filing with
the Commission. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(5).
---------------------------------------------------------------------------

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

    The ISE is proposing to extend the pilot period for the system
change that identifies to a Directed Market Maker (``DMM'') the
identity of the firm entering a Directed Order until January 31, 2008.

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 ISE 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 ISE 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
    On January 5, 2006, the ISE initiated a system change to identify
to a DMM the identity of the firm entering a Directed Order. The ISE
filed this system change on a pilot basis under section 19(b)(3)(A) of
the Exchange Act of 1934 (the ``Exchange Act'') and Rule 19b-4(f)(5)
thereunder \5\ so that it would be effective while the Commission
considered a separate proposed rule change filed under section 19(b)(2)
of the Exchange Act to amend the ISE's rules to reflect the system
change on a permanent basis (the ``Permanent Rule Change'').\6\ The
current pilot expires on July 31, 2007,\7\ but the Commission has not
yet taken action with respect to the Permanent Rule Change.
Accordingly, the Exchange proposes to extend the pilot until January
31, 2008, so that the system change will remain in effect while the
Commission continues to evaluate the Permanent Rule Change.\8\
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 53104 (January 11,
2006), 71 FR 3142 (January 19, 2006) (Notice of Filing and Immediate
Effectiveness for SR-ISE-2006-02).
    \6\ See Securities Exchange Act Release No. 53103 (January 11,
2006), 71 F.R. 3144 (January 19, 2006) (Notice of Filing for SR-ISE-
2006-01).
    \7\ See Securities Exchange Act Release No. 55144 (January 22,
2007), 72 FR 3890 (January 26, 2007) (Notice of Filing and Immediate
Effectiveness for SR-ISE-2007-05).
    \8\ The ISE anticipated that extension of the pilot might be
necessary and included this in the filing for the initial pilot. See
supra note 5, at footnote 5.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the basis under the Act is found in
section 6(b)(5), in that the propose rule change is designed to promote
just and equitable principles of trade, remove impediments to and
perfect the mechanisms of a free and open market and a national market
system and, in general, to protect investors and the public interest.
Extension of the pilot program will allow the Exchange to continue
operating under the pilot while the Commission considers the Permanent
Rule Change.

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

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

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

    Because the foregoing proposed rule change effects a change in an
existing order entry or trading system that (i) Does not significantly
affect the protection of investors or the public interest; (ii) does
not impose any significant burden on competition; and (iii) does not
have the effect of limiting access to or availability of the system, it
has become effective pursuant to section 19(b)(3)(A)(iii) of the Act
\9\ and Rule 19b-4(f)(5) thereunder.\10\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \10\ 17 CFR 19b-4(f)(5).
---------------------------------------------------------------------------

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

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
); or     Send an e-mail to<EMAIL_ADDRESS>Please include

File Number SR-ISE-2007-67 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 Number SR-ISE-2007-67. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments, all

written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for inspection and
copying in the Commission's Public Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the principal office of the ISE. 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-ISE-2007-67 and should be
submitted on or before August 24, 2007.

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\11\
Nancy M. Morris,
Secretary.
---------------------------------------------------------------------------

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

[FR Doc. E7-15070 Filed 8-2-07; 8:45 am]

BILLING CODE 8010-01-P


[Federal Register Volume 78, Number 119 (Thursday, June 20, 2013)]
[Rules and Regulations]
[Pages 37118-37122]
[FR Doc No: 2013-14507]

=======================================================================
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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2012-0961; FRL-9824-5]

Approval and Promulgation of Air Quality Implementation Plans;
Charlotte, Raleigh/Durham and Winston-Salem Carbon Monoxide Limited
Maintenance Plan

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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

SUMMARY: EPA is taking final action to approve changes to the North
Carolina State Implementation Plan (SIP), submitted by the State of
North Carolina Department of Environment and Natural Resources (NC
DENR), on August 2, 2012. Specifically, the State submitted limited
maintenance plan updates for carbon monoxide (CO), showing continued
attainment of the 8-hour CO national ambient air quality standard for
the Charlotte, Raleigh/Durham and Winston-Salem Areas. EPA is approving
this SIP revision because the State has demonstrated that the revision
is consistent with the Clean Air Act (CAA or Act).

DATES: This rule will be effective July 22, 2013.

ADDRESSES: EPA has established a docket for this action under Docket
Identification No. EPA-R04-OAR-2012-0961. All documents in the docket
are listed on the www.regulations.gov Web site. Although listed in the
index, some information is not publicly available, i.e., Confidential
Business Information or other information whose disclosure is
restricted by statute. Certain other material, such as copyrighted
material, is not placed on the Internet and will be publicly available
only in hard copy form. Publicly available docket materials are
available either electronically through www.regulations.gov or in hard
copy at the Regulatory Development Section, Air Planning Branch, Air,
Pesticides and Toxics Management Division, U.S. Environmental
Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia
30303-8960. EPA requests that if at all possible, you contact the
person listed in the FOR FURTHER INFORMATION CONTACT section to
schedule your inspection. The Regional Office's official hours of
business are Monday through Friday, 8:30 to 4:30 excluding federal
holidays.

FOR FURTHER INFORMATION CONTACT: Sean Lakeman, Regulatory Development
Section, Air Planning Branch, Air, Pesticides and Toxics Management
Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth
Street SW., Atlanta, Georgia 30303-8960. The telephone number is (404)
562-9043. Mr. Lakeman can be reached via electronic mail at
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Table of Contents

I. Analysis of the State's Submittal
II. Response to Comments
III. Final Action
IV. Statutory and Executive Order Reviews

I. Analysis of the State's Submittal

    Section 175A of the Clean Air Act (CAA) contains four subsections
(i.e., 175A(a)-(d)) pertaining to maintenance plans. Section 175A(a)
establishes requirements for the maintenance plans associated with
initial SIP redesignation requests. North Carolina previously addressed
the 175A(a) requirements for the CO NAAQS and the State's redesignation
requests and associated maintenance plans were ultimately approved by
EPA for all three of North Carolina's CO areas as a result. See 59 FR
48399 and 60 FR 39258.
    Section 175A(b) requires states to submit an update to the
maintenance plan eight years following the original redesignation to
attainment. For the section 175A(b) update, the state must outline
methods for maintaining the pertinent NAAQS for ten years after the
expiration of the ten-year period as referred to in subsection (a)
(i.e., North Carolina's maintenance plan updates must outline methods
for maintaining the CO NAAQS through 2015). NC DENR satisfied the
requirements for the second maintenance plans for all of its CO
maintenance areas, and EPA subsequently approved NC DENR's second
maintenance plan for each of the State's CO maintenance areas. See 71
FR 14817, March 24, 2006. Although North Carolina has previously
satisfied the requirements for the 175A(b) maintenance plan updates for
all of its CO areas, the State has elected to convert these maintenance
plans to limited maintenance plans.\1\ A summary of EPA's analysis for
this revision is provided below.
---------------------------------------------------------------------------

    \1\ A limited maintenance plan generally includes all the
elements for a full section 175A maintenance plan except that a
limited maintenance plan is not required to include motor vehicle
emissions budgets for transportation conformity purposes. For more
details on limited maintenance plans see the October 6, 1995,
Memorandum from Joseph W. Praise to the Air Branch Chiefs, Regions
I-X, entitled ``Limited Maintenance Plan Option for Nonclassifiable
CO Nonattainment Areas.'' A copy of the October 6, 1995, Memorandum
is included in the docket for today's rulemaking.
---------------------------------------------------------------------------

    Finally, with respect to the remaining sub-sections of section
175A, EPA notes that sub-section (c) does not apply to this rulemaking,
given that EPA has previously redesignated the Charlotte, Raleigh/
Durham, and Winston-Salem areas to attainment for CO. Section 175A(d),
which includes the contingency provisions requirements associated with
maintenance plans, is relevant to today's revision and is addressed in
section A4, below.

A. Consistency With the October 6, 1995, Memorandum

    EPA's interpretation of section 175A of the CAA, as it pertains to
limited maintenance plans for CO, is contained in the October 6, 1995,
Memorandum from Joseph W. Praise to the Air Branch Chiefs, Regions I-X,
entitled ``Limited Maintenance Plan Option for Nonclassifiable CO
Nonattainment Areas.'' See the docket for today's

rulemaking for a copy of this memorandum. North Carolina addressed the
five major elements of that policy, as follows:
1. Attainment Inventory
    The state is required to develop an attainment emissions inventory
to identify a level of emissions in the area which is sufficient to
attain the CO NAAQS. This inventory should be consistent with EPA's
most recent guidance on emission inventories for nonattainment areas
available at the time the SIP is developed and should include the
emissions during the time period associated with the monitoring data
showing attainment. It should be based on actual ``typical CO season
day'' emissions for all source classifications (i.e., stationary point
and area sources and nonroad and onroad mobile sources) for the
attainment year. In its August 2, 2012, submittal, NC DENR provided a
comprehensive CO emissions inventory for nonroad mobile, onroad mobile,
point, and area sources for the Charlotte, Raleigh-Durham, and Winston-
Salem CO Maintenance Areas.
    NC DENR collected or developed the point source emissions inventory
from stationary sources that have the potential to emit more than five
tons per year of CO emissions from a single facility and are required
to have an operating permit. The stationary area source inventory is
estimated on a county level and consisted of those sources whose
emissions are relatively small, but due to the large number of sources,
the collective emissions could be significant. North Carolina estimated
the stationary area source emissions by multiplying an emission factor
by some known indicator of collective activity (such as fuel usage,
number of households, or population). For on-road mobile source
emissions, NC DENR used EPA's Motor Vehicle Emission Simulator (MOVES)
model version 2010a (MOVES2010a), released in August 2010, for
estimating vehicle emissions.
    Nonroad mobile sources are pieces of equipment that can move but do
not use roadways (e.g. lawn mowers, construction equipment, railroad
locomotives, and aircraft). The emissions from this category are
calculated at the county level using EPA's NONROAD2008s nonroad mobile
model, with the exception of railroad locomotives and aircraft engines.
The railroad locomotives and aircraft engines are estimated by taking
an activity and multiplying by an emission factor.
    Table 1 displays the 2010 attainment year emissions inventory as
required for the limited maintenance plans. Appendix B of North
Carolina's SIP submittal provides detailed discussions regarding the
development of emissions for the four emission source classifications,
and is provided in the docket for today's rulemaking.

                           Table 1--2010 CO Emissions (tons/day) for Maintenance Areas
----------------------------------------------------------------------------------------------------------------
             County                Point source     Area source       On-Road         Nonroad          Total
----------------------------------------------------------------------------------------------------------------
                                         Raleigh-Durham Maintenance Area
----------------------------------------------------------------------------------------------------------------
Durham..........................            0.97            1.54          186.00           19.04          207.55
Wake............................            1.17            4.26          642.97           70.62          719.02
                                 -------------------------------------------------------------------------------
    Total.......................            2.14            5.80          828.97           89.66          926.57
----------------------------------------------------------------------------------------------------------------
                                         Winston-Salem Maintenance Area
----------------------------------------------------------------------------------------------------------------
Forsyth.........................            2.22            1.41          244.16           23.97          271.76
----------------------------------------------------------------------------------------------------------------
                                           Charlotte Maintenance Area
----------------------------------------------------------------------------------------------------------------
Mecklenburg.....................            2.39            4.21          724.39          114.71          845.70
----------------------------------------------------------------------------------------------------------------

2. Maintenance Demonstration
    In the October 6, 1995, Memorandum, EPA stated that the maintenance
demonstration requirement is considered to be satisfied for
nonclassifiable areas if the monitoring data shows that the area is
meeting the air quality criteria for limited maintenance areas (i.e.,
85 percent of the eight hour CO NAAQS, or 7.65 parts per million
(ppm)). EPA determined in this same memorandum that there is no
requirement to protect emissions over the maintenance period. Instead,
EPA believes that if the area begins the maintenance period at, or
below, 7.65 ppm (85 percent of the 8-hour CO NAAQS), the applicability
of prevention of significant deterioration requirements, control
measures already in the SIP, and other federal measures should provide
adequate assurance of maintenance throughout the maintenance period.
Monitoring data from 2008-2011 shows all three areas below the 8-hour
CO NAAQS values. See Table 2 below. All monitoring levels are well
below the 85 percent threshold of 7.65 ppm and therefore the State has
satisfied the maintenance demonstration requirement for a limited
maintenance plan for each of its CO maintenance areas.
---------------------------------------------------------------------------

    \2\ The Direct Final Rulemaking on February 22, 2013, listed the
Wake County 2009 design value as 1.3 ppm. See 78 FR 12238. The value
reported by the State was actually 1.2 ppm and the change is
reflected in this final rulemaking.

                            Table 2--CO 8-Hour Monitored Concentration Design Values
                                                      [ppm]
----------------------------------------------------------------------------------------------------------------
             County                 Monitor ID         2009            2010            2011         8-Hr NAAQS
----------------------------------------------------------------------------------------------------------------
                                         Raleigh-Durham Maintenance Area
----------------------------------------------------------------------------------------------------------------
Wake............................       371830014          \2\1.3             1.3             1.4               9
----------------------------------------------------------------------------------------------------------------

                                         Winston-Salem Maintenance Area
----------------------------------------------------------------------------------------------------------------
Forsyth.........................       370670023             1.7             1.9             2.1               9
----------------------------------------------------------------------------------------------------------------
                                           Charlotte Maintenance Area
----------------------------------------------------------------------------------------------------------------
Mecklenburg.....................       371190041             1.7             1.7             1.5               9
----------------------------------------------------------------------------------------------------------------

3. Monitoring Network and Verification of Continued Attainment
    Once an area has been redesignated, the state should continue to
operate an appropriate air quality monitoring network, in accordance
with 40 CFR part 58, to verify the attainment status of the area. This
is particularly important for areas using a limited maintenance plan
because there will be no cap on emissions. In accordance with 40 CFR
part 58, NC DENR commits to continue monitoring CO at the existing
regulatory monitors in the three CO maintenance areas to ensure that CO
concentrations remain well below the 7.65 ppm threshold for limited
maintenance plans. The State's monitoring plan for 2012 can be found at
the following site: http://www.ncair.org/monitor/monitoring_plan/new_plan/2012_NCDAQ_Network_Plan.pdf. EPA has determined that the State
has satisfied the monitoring network and verification of continued
attainment requirements for the limited maintenance plans.
4. Contingency Plan
    Section 175A(d) of the CAA requires that a maintenance plan include
contingency provisions, as necessary, to promptly correct any violation
of the NAAQS that occurs after redesignation of an area. The October 6,
1995, Memorandum further requires that the contingency provisions
identify the measures to be adopted, a schedule and procedure for
adoption and implementation, and a specific time limit for action by
the state.
    In its August 2, 2012, submittal, NC DENR committed to the same
contingency measures that EPA previously approved on March 24, 2006 (71
FR 14817) and a subsequent clarification on June 19, 2007 (72 FR
33692). The State pre-adopted an oxygenated fuels program with minimum
oxygen content by weight of 2.7 for Charlotte, Raleigh-Durham, and
Winston-Salem maintenance areas as a contingency measure for the CO
maintenance plan. The oxygenated fuel program is required under the CAA
for the Raleigh-Durham and Winston-Salem areas as a required control
measure prior to the attainment redesignation. Charlotte was placed
under the oxygenated fuel program for effective area-wide CO emission
reduction and to ease State implementation efforts. The contingency
measure triggering date will be no more than 60 days after an ambient
air quality violation is monitored. NC DENR will commence an analysis
and regulation development process during this time. The State will
consider the following control measures:
    a. Amending the oxygenated fuels program by adopting oxygenate
content of 2.0 percent to 2.7 percent by weight, or activate of the 2.7
percent by eight pre-adopted contingency measure, or 2.7 percent to 3.1
percent by weight;
    b. expanding coverage of oxygenated fuels to include counties where
a strong commuting pattern into the core maintenance area exists;
    c. alternative fuel vehicle programs to include compressed natural
gas and electric vehicles; and,
    d. employee commute options programs.

NC DENR committed to implement at least one of the control measures
within 24 months of the trigger, or as expeditiously as practicable.
EPA has determined that the State has satisfied the contingency plan
requirements pursuant to section 175A(d) of the CAA as well as those of
the October 6, 1995, Memorandum.
5. Conformity Determination Under the Limited Maintenance Plan
    The transportation conformity rule of November 24, 1993 (58 FR
62188), and the general conformity rule of November 30, 1993 (58 FR
63214), apply to nonattainment areas and maintenance areas operating
under the maintenance plans. Under either rule, one means of
demonstrating conformity of federal actions is to indicate that
expected emissions from planned actions are consistent with the
emissions budget for the area.
    EPA's October 6, 1995, Memorandum states that emissions budgets in
limited maintenance plan areas may be treated as essentially not
constraining for the length of the maintenance period because it is
unreasonable to expect that such an area will experience so much growth
in that period that a violation of the CO NAAQS would result. In other
words, EPA concluded that, for these areas, emissions need not be
capped for the maintenance period.
    In accordance with the transportation conformity rule, approval of
a limited maintenance plan only removes the requirement to conduct a
regional emissions analysis as part of the conformity determination.
The requirement to demonstrate conformity per the requirements in Table
1 of 40 CFR 93.109 still applies. Additionally, federally funded
projects are still subject to project level transportation conformity
analysis requirements. However, no regional modeling analysis would be
required.
    Transportation partners should note this approval of these limited
maintenance plans in future transportation conformity determinations.
Additionally, while the approvals of these limited maintenance plans
waives the requirements for a regional emissions analysis for the CO
NAAQS, as mentioned above, it does not waive other conformity
requirements for the CO standard for the Charlotte, Raleigh-Durham and
Winston-Salem areas, and it does not waive transportation conformity
requirement for other pollutants/precursors for which these areas may
be designated nonattainment or redesigned to attainment with a full
maintenance plan.

II. Response to Comments

    On February 22, 2013 (78 FR 12267), EPA published a direct final
rule approving North Carolina's August 2, 2012, SIP submission for a
limited maintenance plan update for CO, showing continued attainment of
the 8-hour CO NAAQS for the Charlotte, Raleigh/Durham and Winston-Salem

Areas. EPA published an accompanying proposed approval in the event
that comments were received such that the direct final rule needed to
be withdrawn. Specifically, in the direct final rule, EPA stated that
if adverse comments were received by March 25, 2013, the rule would be
withdrawn and not take effect, but that the proposed rule would still
remain in effect and that an additional public comment period would not
be instituted if EPA could sufficiently address any comments received
on the direct final rulemaking. On March 25, 2013, EPA received
comments from a single commenter. The comments could be interpreted as
adverse and, therefore, EPA withdrew the direct final rule. A summary
of the comments received and EPA's response is provided below.
    Comment: The commenter stated ``were studies conducted to establish
the criteria for labeling as a maintenance area? Is there something
geographic and standard about this area.''
    Response: This comment is outside of the scope of today's action.
Nonetheless, EPA notes that the process to designate a maintenance area
under the CO NAAQS involves an evaluation of specific criteria to
determine whether an area is in compliance or out of compliance with
the CO NAAQS. If an area is determined to be out of compliance, EPA
then determines an appropriate boundary for the area and designates the
area as a ``nonattainment'' area. The designation process for CO areas
was completed in the early 1990's. The Charlotte, Raleigh/Durham and
Winston-Salem Areas were all designated as nonattainment for the CO
NAAQS. Once an area is designated nonattainment, an area can be
redesignated to ``attainment'' (i.e., meaning that the area is in
compliance of the NAAQS), if it meets the criteria of section
107(d)(3)(E) of the CAA. All three of the North Carolina areas were
redesignated to ``attainment'' for the CO NAAQS and are thus considered
``maintenance'' areas. See 59 FR 48399 and 60 FR 39258.
    Comment: The commenter questioned whether the emissions parameters
are ``constricting the water vapor potential'' and whether the
emissions tolerances are ``excessive considering most dealerships are
manufacturing cars that use alternative energies and have done so for
approximately 10 years now[?]''
    Response: The on-road mobile source emissions inventory in North
Carolina's limited maintenance plans for the Charlotte, Raleigh/Durham
and Winston-Salem Areas were developed according to EPA guidelines and
with the MOVES emissions model. The MOVES model can be used to estimate
exhaust and evaporative emissions as well as brake and tire wear
emissions from all types of on-road vehicles. The MOVES model
incorporates substantial new emissions test data and accounts for
changes in vehicle technology and regulations as well as improved
understanding of in-use emission levels and the factors that influence
them. NC DENR appropriately utilized the MOVES model to estimate the
on-road mobile source emissions for the limited maintenance plan for
all applicable vehicles and technologies, for the Charlotte, Raleigh/
Durham and Winston-Salem Areas.

III. Final Action

    EPA is approving the aforementioned changes to the State of North
Carolina SIP, because they are consistent with the CAA, and EPA's
policy related to limited maintenance plans.

IV. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP
submission that complies with the provisions of the Act and applicable
federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in
reviewing SIP submissions, EPA's role is to approve state choices,
provided that they meet the criteria of the CAA. Accordingly, this
action merely approves state law as meeting federal requirements and
does not impose additional requirements beyond those imposed by State
law. For that reason, this action:
     Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Order
12866 (58 FR 51735, October 4, 1993);
     does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
     does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
     is not subject to requirements of Section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
     does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, this rule does not have tribal implications as
specified by Executive Order 13175 (65 FR 67249, November 9, 2000),
because the SIP is not approved to apply in Indian country, and EPA
notes that it will not impose substantial direct costs on tribal
governments or preempt tribal law.
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this action and
other required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2).
    Under section 307(b)(1) of the CAA, petitions for judicial review
of this action must be filed in the United States Court of Appeals for
the appropriate circuit by August 19, 2013. Filing a petition for
reconsideration by the Administrator of this final rule does not affect
the finality of this action for the purposes of judicial review nor
does it extend the time within which a petition for judicial review may
be filed, and shall not postpone the effectiveness of such rule or
action. Parties with objections to this direct final rule are
encouraged to file any comment in response to the parallel notice of
proposed rulemaking for this action published in the proposed rules
section of today's Federal Register, rather than file an immediate
petition for judicial review of this direct final rule, so that EPA can
withdraw this direct final rule and address the comment in the proposed
rulemaking. This action may not be challenged later in proceedings to

enforce its requirements. See section 307(b)(2).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by
reference, Intergovernmental relations, Reporting and recordkeeping
requirements, Volatile organic compounds.

    Dated: June 7, 2013.
A. Stanley Meiburg,
Acting Regional Administrator, Region 4.

    40 CFR part 52 is amended as follows:

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

0
1. The authority citation for part 52 continues to read as follows:

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

Subpart II--North Carolina

0
2. Section 52.1770(e) is amended by adding a new entry for ``8-Hour
Carbon Monoxide Limited Maintenance Plan for Charlotte, Raleigh/Durham
and Winston-Salem Maintenance Area'' at the end of the table to read as
follows:

Sec.  52.1770  Identification of plan.

* * * * *
    (e) * * *

                                                  EPA-Approved North Carolina Non-Regulatory Provisions
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Federal Register
              Provision                     State effective date              EPA approval date                 citation               Explanation
--------------------------------------------------------------------------------------------------------------------------------------------------------

                                                                      * * * * * * *
8-Hour Carbon Monoxide Limited        August 2, 2012.................  6/20/2013......................  [Insert citation of      .......................
 Maintenance Plan for Charlotte,                                                                         publication]
 Raleigh/Durham and Winston-Salem
 Maintenance Area.
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[FR Doc. 2013-14507 Filed 6-19-13; 8:45 am]
BILLING CODE 6560-50-P