[Federal Register Volume 81, Number 40 (Tuesday, March 1, 2016)]
[Rules and Regulations]
[Pages 10490-10491]
[FR Doc No: 2016-04434]

=======================================================================
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DEPARTMENT OF LABOR

Occupational Safety and Health Administration

29 CFR Part 1910

Occupational Safety and Health Standards

CFR Correction

    In Title 29 of the Code of Federal Regulations, Parts 1900 to Sec.
1910.999, revised as of July 1, 2015, on page 243, in Sec.  1910.106,
paragraph (a)(14) introductory text is reinstated to read as follows:

Sec.  1910.106  Flammable liquids.

* * * * *
    (14) Flashpoint means the minimum temperature at which a liquid
gives off vapor within a test vessel in sufficient concentration to
form an ignitable mixture with air near the surface of the

liquid, and shall be determined as follows:
* * * * *
[FR Doc. 2016-04434 Filed 2-29-16; 8:45 am]
 BILLING CODE 1505-01-D


[Federal Register Volume 88, Number 209 (Tuesday, October 31, 2023)]
[Notices]
[Pages 74547-74550]
[FR Doc No: 2023-23941]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-98799; File No. SR-ICEEU-2023-021]

Self-Regulatory Organizations; ICE Clear Europe Limited; Order
Approving Proposed Rule Change, as Modified by Amendment No. 1,
Relating to Amendments to its Operational Risk and Resilience Policy

October 25, 2023.

I. Introduction

    On August 15, 2023, ICE Clear Europe Limited (``ICE Clear Europe''
or ``Clearing House'') filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the ``Act'') \1\ and Rule 19b-4
thereunder,\2\ a proposed rule change to amend its Operational Risk and
Resilience Policy (the ``Policy''). On August 24, 2023, ICE Clear
Europe filed Amendment No. 1 to the proposed rule change to make
certain changes to the Exhibits 5.\3\ Notice of the proposed rule
change, as modified by Amendment No. 1, was published for comment in
the Federal Register on September 5, 2023.\4\ On October 3, 2023, the
Commission designated a longer period for Commission action on the
proposed rule change until December 4, 2023.\5\ The Commission has not
received comments regarding the proposed rule change. For the reasons
discussed below, the Commission is approving the proposed rule change,
as modified by Amendment No. 1 (hereinafter ``the Proposed Rule
Change'').
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 corrects the presentation of changes in
Exhibit 5 by reflecting the deletion of the prior ``Oversight of the
Policy'' section as part of the updated governance and oversight
provisions. This amendment was filed with the Commission on August
24, 2023.
    \4\ Self-Regulatory Organizations; ICE Clear Europe Limited;
Notice of Filing of Proposed Rule Change, as Modified by Amendment
No. 1, Relating to Amendments to its Operational Risk and Resilience
Policy, Exchange Act Release No. 98237 (Aug. 29, 2023); 88 FR 60727
(Sep. 5, 2023) (SR-ICEEU-2023-021) (``Notice'').
    \5\ Self-Regulatory Organizations; ICE Clear Europe Limited;
Notice of Designation of Longer Period for Commission Action on
Proposed Rule Change, as Modified by Amendment No. 1, Relating to
Amendments to its Operational Risk and Resilience Policy; Exchange
Act Release No. 98573 (Sep. 27, 2023), 88 FR 68240 (Oct. 3, 2023)
(File No. SR-ICEEU-2023-021).
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II. Description of the Proposed Rule Change

A. Background

    ICE Clear Europe is registered with the Commission as a clearing
agency for

the purpose of clearing security-based swaps. In its role as a clearing
agency for security-based swaps, ICE Clear Europe maintains the Policy
to address how ICE Clear Europe identifies, assesses, manages,
monitors, and reports its operational risks. ICE Clear Europe is
proposing to amend the Policy to add new scenario analysis and testing
relating to operational risk and resilience, require that ICE Clear
Europe assess emerging risks, and update the review process for the
Policy. The Policy has five sections: (1) Introduction, (2) Operational
Risk and Resilience Framework, (3) Risk and Control Assessments, (4)
Governance and Oversight, and (5) Appendix. To effect these amendments,
the Proposed Rule Change would amend all sections except the
Introduction, renumber or relabel various provisions throughout the
Policy, and update the version history to reflect these changes.

B. Operational Risk and Resilience Framework

    Section 2 of the Policy, ``Operational Risk and Resilience
Framework,'' describes the overall framework that ICE Clear Europe uses
to address operational risk \6\ and maintain operational resilience.
Specifically, ICE Clear Europe uses this framework to reduce the
likelihood of an operational disruption event within acceptable
tolerance, and mitigate and quickly recover from an operational
disruption event. In addition to the Policy itself, the policies and
procedures in the framework are: (i) the Incident Management Policy;
(ii) the Business Continuity & Disaster Recovery Policy; (iii) the
Information Security Policy and Cyber Security Strategy; (iv) the
Outsourcing Policy; and (v) the Vendor Management Policy.\7\
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    \6\ The Policy defines operational risk as the risk of an event
occurring which negatively impacts the achievement of business
objectives resulting from inadequate or failed internal operational
controls, people, systems, or external events.
    \7\ See Self-Regulatory Organizations; ICE Clear Europe Limited;
Order Approving Proposed Rule Change Relating to ICE Clear Europe
Operational Risk and Resilience Policy, Exchange Act Release No.
96351 (Nov. 18, 2022); 87 FR 72553 (Nov. 25, 2022) (SR-ICEEU-2022-
015).
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    ICE Clear Europe proposes to update the description of the
operational risk and resilience framework to reflect the new name of
the Outsourcing Policy. ICE Clear Europe recently changed the name of
the Outsourcing Policy to the Outsourcing and Third Party Risk
Management Policy, and the Proposed Rule Change would reflect this
update.\8\ The Proposed Rule Change also would add language to reflect
that the updated policy has been approved by the Board and is pending
regulatory approval.\9\
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    \8\ For more information regarding the changes relating to the
Outsourcing and Third Party Risk Management Policy, See Self-
Regulatory Organizations; ICE Clear Europe Limited; Order Approving
Proposed Rule Change, as Modified by Amendment No. 1 and Partial
Amendment No. 2, Relating to Amendments to the Outsourcing Policy,
Exchange Act Release No. 98387 (Sep. 14, 2023); 88 FR 64953 (Sep.
20, 2023) (SR-ICEEU-2023-018).
    \9\ Following publication of the Notice, the Commission approved
ICE Clear Europe's proposed change to the name of the Outsourcing
Policy, as well as other changes to the Outsourcing Policy. See
Self-Regulatory Organizations; ICE Clear Europe Limited; Order
Approving Proposed Rule Change, as Modified by Amendment No. 1 and
Partial Amendment No. 2, Relating to Amendments to the Outsourcing
Policy, Exchange Act Release No. 98387 (Sep. 14, 2023); 88 FR 64953
(Sep. 20, 2023) (SR-ICEEU-2023-019).
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    ICE Clear Europe proposes to update the description of its scenario
analysis and testing found in Section 2.6 of the Policy. As noted in
the Policy, ICE Clear Europe has scenario analysis and testing in place
to identity any operational resilience weakness, and it conducts such
testing on important business services to determine if it can remain
within the impact tolerances under a range of extreme but plausible
disruption scenarios. ICE Clear Europe proposes to make additions to
this section without deleting any language, except for one exception
noted below relating to the Board.
    Specifically, the Proposed Rule Change would add a requirement that
the Clearing House must maintain an inventory of scenarios for the
purposes of scenario analysis and testing. Moreover, the Policy
currently specifies that the testing should include scenarios which
disrupt more than one important business service simultaneously and
take into account dependencies.\10\ The Proposed Rule Change would
specify that such dependencies should be both internal and external.
The Proposed Rule Change would also add language stating that a portion
of the scenarios should be identified and selected for reverse stress
testing (through a practical test where possible or a desk top
exercise), and that, over a three-year cycle, all scenarios would have
to be tested at least once by either a practical test or a desk top
exercise. In addition, the inventory of scenarios would need to be
reviewed on at least an annual basis in order to determine if the
scenarios are still fit for purpose and if updates are required. The
annual review of the inventory would be the responsibility of the First
Line with Second Line review, and would be approved by the Executive
Risk Committee (``ERC'').\11\ The ERC would also be responsible for
approving any changes to the list of scenarios outside of the annual
review cycle. The detailed scope of the testing based on the scenarios
in the inventory and the results of testing and assessment against the
risk register would be shared with the Second Line for review. The
Proposed Rule Change would also specify that the scenario analysis and
testing results would be submitted to the ERC or relevant Board sub-
committee by removing a reference to the Board and replacing it with
the relevant Board sub-committee.
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    \10\ The Clearing House requires that for each important
business service, the following dependencies must be identified:
people, processes, technology, facilities, and underlying
information.
    \11\ Enteprise Risk Management is the Second Line of defense and
is responsible for challenging the First Line and monitoring
adherence to the requirement of this policy. Key Controls have an
expected high level of mitigation and the associated risks have an
inherent risk score of ``High'' or ``Very High''. First Line refers
to the defense (or Risk Owner) responsible for managing the risks to
within the Board appetite and ensuring adherence to all the
requirements in the Policy.
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C. Risk and Control Assessments

    Section 3 of the Policy, ``Risk and Control Assessments,''
addresses the process that identifies, assesses, manages, monitors, and
reports operational risk. The Proposed Rule Change would add a new
section on control validation and assessment, outlining that upon entry
to the risk register or when a material change is made to a Key
Control, Enterprise Risk Management (``ERM'') will confirm that
validation of Key Controls is carried out. Additionally, the amendments
would state that validation may be verified directly by ERM or through
ERM's oversight of validations performed by the First Line. The
amendments would also replace two references to control testing with
control validation throughout the Policy to be consistent with the new
section. The Proposed Rule Change does not redefine control testing and
is meant to align with the Clearing House's Global Enterprise Risk
Management Policy.
    In Section 3.2, ``Risk Assessment,'' the amendments would address
emerging risks by adding a paragraph stating that there should be an
assessment of the Velocity for emerging risks. Velocity would be
defined as an estimate of the time frame within which impact of a risk
may be realized, and would be considered as an additional factor
utilized in prioritizing Emerging Risks. Other non-substantive drafting
clarifications would be made in this section, such as renumbering to
account for the new section on control validation and assessment.

D. Governance and Oversight

    In Section 4, ``Governance and Oversight,'' the amendments would
add three new sections: ``Reviews,'' ``Breach Management,'' and
``Exception Handling.''
    The ``Reviews'' section would replace the previous ``Oversight of
the Policy'' section, which stated only that the Policy is subject to
the oversight of the Risk Oversight Department and that failure to
comply with the Policy shall be escalated to the Board. This statement
must be removed to ensure consistency with the Operational Risk and
Resilience Framework section discussed above, which specifies that the
First Line of defense is responsible for ensuring adherence to all the
requirements in the Policy, with the Risk Oversight Department and
Enterprise Risk Management acting as the Second Line of defense, with
responsibility for challenging the First Line and monitoring adherence
to the requirement of the Policy.
    Instead, the new ``Reviews'' section of the Policy would include a
number of provisions governing the oversight and review of the Policy.
First, it would specify that the owner of the Policy would be
responsible for ensuring that the Policy remains up to date and is
reviewed in accordance with ICE Clear Europe's governance processes. It
would also provide that, unless otherwise stated, a document review
will be conducted by the document owner and/or relevant staff as
appropriate, with sign off being provided by the head of the department
(or their delegate) and the Chief Risk Officer. Such document reviews
would need to encompass, at a minimum, regulatory compliance;
documentation and purpose; implementation; use; and open items from
previous validations or reviews (where appropriate). The results of the
review, including any findings, would need to be reported to ICE Clear
Europe's Executive Risk Committee, along with the priority of findings,
proposed remediations, and target due date to remediate the findings.
Finally, the ``Reviews'' section would specify that the document owner
will aim to remediate the findings, complete internal governance, and
receive regulatory approvals (where applicable) before the next annual
review is due.
    The new ``Breach Management'' section would specify that the
document owner would be responsible for reporting material breaches or
unapproved deviations from the Policy to their Head of Department, the
Chief Risk Officer, and the Head of Regulation and Compliance (or, as
applicable, their respective delegates). Those individuals together
would determine if further escalation should be made to relevant senior
executives, the Board, and/or competent authorities.
    Finally, the new ``Exception Handling'' section would specify that
exceptions to the Policy must be approved in accordance with ICE Clear
Europe's governance process for the approval of changes, which would
only take effect after completion of all necessary internal and
regulatory approvals.

E. Appendix

    The Proposed Rule Change also would modify and update three of the
appendixes, add one new appendix, and remove a section from one
appendix.
    Specifically, the Proposed Rule Change would modify and update the
table included as Appendix D, ``Assessment of Expected Level of Risk
Mitigation,'' by renaming the current ``Mitigation'' column as
``Rating'' and adding a new column labeled ``Examples,'' which would
include specific examples for each level of rating (high, medium, and
low).
    The Proposed Rule Change would update and modify the table included
as Appendix E, ``Control Effectiveness Ratings,'' by renaming the
current ``Effectiveness'' and ``Guidelines'' columns as ``Rating'' and
``Control Assessment Guidelines,'' respectively. In addition, an
additional bullet point would be in the guideline column for the
``Unsatisfactory'' rating, specifying that this rating would apply
where the control validation and/or assessment and audit programs
result in major findings.
    The columns for the table included as Appendix F, ``Control
Remediation Recommendation & Timelines,'' (Appendix F) would also be
renamed. The current heading labeled Control Effectiveness would be
renamed to Control Effectiveness Rating, and the heading labeled
Mitigation would be renamed to Level of Risk Mitigation. In addition,
for the scenario with a Control Effectiveness Rating of Needs
Improvement and a High Level of Risk Mitigation, the recommendation
would be changed from Medium to High.
    A new table would be added as Appendix G, ``Velocity Assessment
Guidance,'' in connection with the amendments to Section 3.2 discussed
above relating to an assessment of the velocity of emerging risks. This
section would include a chart separating the Velocity Rating into
categories of Immediate (less than six months), Short Term (between six
and 18 months), and Medium Term (greater than 18 months), and a
description noting that each rating is assessed based on the time in
which the impact of a risk may be realized if the risk is unmitigated
(e.g., an immediate risk is one for which the impact may be realized
within six months of the risk event occurring if the risk is
unmitigated).
    Finally, the amendments would remove the section labeled Control
Testing Scope following the chart on Risk Mitigation in Appendix H, to
conform to the change in the Policy to refer to control validation
rather than control testing.

III. Discussion and Commission Findings

    Section 19(b)(2)(C) of the Act directs the Commission to approve a
Proposed Rule Change of a self-regulatory organization if it finds that
such Proposed Rule Change is consistent with the requirements of the
Act and the rules and regulations thereunder applicable to such
organization.\12\ For the reasons discussed below, the Commission finds
that the Proposed Rule Change is consistent with Section 17A(b)(3)(F)
of the Act,\13\ and Rules 17Ad-22(e)(2)(v) and 17Ad-22(e)(17)
thereunder.\14\
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    \12\ 15 U.S.C. 78s(b)(2)(C).
    \13\ 15 U.S.C. 78q-1(b)(3)(F).
    \14\ 17 CFR 240.17Ad-22(e)(2)(v) and (e)(17).
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i. Consistency With Section 17A(b)(3)(F) of the Act
    Section 17A(b)(3)(F) of the Act requires, among other things, that
the rules of ICE Clear Europe be designed to promote the prompt and
accurate clearance and settlement of securities transactions and, to
the extent applicable, derivative agreements, contracts, and
transactions.\15\ Based on its review of the record, and for the
reasons discussed below, the Commission finds that the proposed changes
to the Policy are consistent with the promotion of the prompt and
accurate clearance and settlement of securities transactions.
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    \15\ 15 U.S.C. 78q-1(b)(3)(F).
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    As a registered clearing agency, ICE Clear Europe faces a number of
operational risks that could impact or threaten its ability to clear
and settle transactions if they are not eliminated or mitigated. As
noted above, ICE Clear Europe maintains the Policy to address how it
identifies, assesses, manages, monitors, and reports such operational
risks. Improving or enhancing the Policy likewise improves or enhances
ICE Clear Europe's ability to manage or mitigate its operational risks
and

therefore ensure that it can continue to clear and settle securities
transactions.
    For example, as discussed above, the Proposed Rule Change would
update the Policy to require ICE Clear Europe to maintain an inventory
of scenarios for the purposes of scenario analysis and testing, which
inventory would need to be reviewed on at least an annual basis in
order to determine if the scenarios are still fit for purpose and if
updates are required. These new requirements should help ensure that
ICE Clear Europe personnel identify and maintain an appropriate
inventory of scenarios, determine in a timely manner if updates to the
inventory or scenarios are needed, and identify any gaps and necessary
resolutions or updates to the inventory and scenarios sooner than what
is currently required.
    Taken together, these enhancements to the Policy should enhance ICE
Clear Europe's operational resilience, which in turn should decrease
the likelihood that operational incidents would disrupt its ability to
promptly and accurately clear and settle securities transactions.
Accordingly, the Commission finds that the Proposed Rule Change is
consistent with Section 17A(b)(3)(F) of the Act.\16\
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    \16\ 15 U.S.C. 78q-1(b)(3)(F).
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ii. Consistency With Rule 17Ad-22(e)(2)(v)
    Rule 17Ad-22(e)(2)(v) require that ICE Clear Europe establish,
implement, maintain, and enforce written policies and procedures
reasonably designed to provide governance arrangements that, among
other things, are clear and transparent and specify clear and direct
lines of responsibility.\17\
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    \17\ 17 CFR 240.17Ad-22(e)(2)(v).
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    As discussed above, the Proposed Rule Change would add new sections
to the Policy addressing reviews, breach management, and exception
handling. Among other things, the section addressing reviews would make
the document owner responsible for ensuring that the Policy remains up-
to-date and is reviewed in accordance with ICE Clear Europe's
governance processes. Additionally, document reviews will be conducted
by the document owner and signed off by the head of the department (or
their delegate) and the Chief Risk Officer. These reviews would
encompass, at a minimum, regulatory compliance; documentation and
purpose; implementation; use; and, where appropriate, open items from
previous validations or reviews.
    Under the new section covering breach management, the document
owner also would be responsible for reporting material breaches or
unapproved deviations from the Policy to their Head of Department, the
Chief Risk Officer, and the Head of Regulation and Compliance (or, as
applicable, their respective delegates).
    Under the new section addressing exception handling, exceptions to
the Policy would need to be approved in accordance with ICE Clear
Europe's governance process for the approval of changes, and could only
take effect after completion of all necessary internal and regulatory
approvals.
    Additionally, the Proposed Rule Change would add a new section to
the Policy on control validation and assessment, outlining that upon
entry to the risk register or when a material change is made to a Key
Control, ERM will confirm that validation of Key Controls is carried
out. The Proposed Rule Change would also amend the Policy to state that
validation may be verified directly by ERM or through ERM's oversight
of validations performed by the First Line.
    Taken together, these changes would help establish clear and direct
responsibilities for the document owner of the Policy. Accordingly, the
Commission finds that the Proposed Rule Change is consistent with Rule
17Ad-22(e)(2)(v).\18\
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    \18\ 17 CFR 240.17Ad-22(e)(2)(v).
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iii. Consistency With Rule 17Ad-22(e)(17)

    Rule 17Ad-22(e)(17) requires that ICE Clear Europe establish,
implement, maintain, and enforce written policies and procedures
reasonably designed to manage its operational risks by, among other
things, identifying the plausible sources of operational risk, both
internal and external, and mitigating their impact through the use of
appropriate systems, policies, procedures, and controls.\19\
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    \19\ 17 CFR 240.17Ad-22(e)(17).
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    By adding a requirement to maintain an inventory of scenarios for
the purposes of scenario analysis and test and review those scenarios
annually, the Proposed Rule Change would support ICE Clear Europe's
ability to identify plausible sources of operational risk, both
internal and external, and mitigate their impact through the Policy,
which supports Ice Clear Europe's efforts to manage and mitigate its
operational risks. Accordingly, the Commission finds that the Proposed
Rule Change is consistent with Rule 17Ad-22(e)(17).\20\
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    \20\ 17 CFR 240.17Ad-22(e)(17).
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IV. Conclusion

    On the basis of the foregoing, the Commission finds that the
Proposed Rule Change, as modified by Amendment no. 1, is consistent
with the requirements of the Act, and in particular, with the
requirements of Section 17A(b)(3)(F) of the Act,\21\ and Rules 17Ad-
22(e)(2)(v) and 17Ad-22(e)(17) thereunder.\22\
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    \21\ 15 U.S.C. 78q-1(b)(3)(F).
    \22\ 17 CFR 240.17Ad-22(e)(2)(v) and (e)(17).
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    It is therefore ordered pursuant to Section 19(b)(2) of the Act
\23\ that the Proposed Rule Change (SR-ICEEU-2023-021) be, and hereby
is, approved.\24\
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    \23\ 15 U.S.C. 78s(b)(2).
    \24\ In approving the Proposed Rule Change, the Commission
considered the proposal's impact on efficiency, competition, and
capital formation. 15 U.S.C. 78c(f).
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    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\25\
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    \25\ 17 CFR 200.30-3(a)(12).

Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-23941 Filed 10-30-23; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 75, Number 223 (Friday, November 19, 2010)]
[Proposed Rules]
[Pages 70863-70868]
[FR Doc No: 2010-29231]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2008-0090; Directorate Identifier 2007-NM-312-AD]
RIN 2120-AA64

Airworthiness Directives; The Boeing Company Model 747 Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Supplemental notice of proposed rulemaking (NPRM); reopening of
comment period.

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SUMMARY: We are revising an earlier proposed airworthiness directive
(AD) for certain Model 747 airplanes. The original NPRM would have
required measuring the electrical bond resistance between the motor
operated valve (MOV) actuators and airplane structure for the main,
center, auxiliary, and horizontal stabilizer fuel tanks, as applicable,
and corrective action if necessary. The original NPRM also would have
required a revision to the maintenance program to incorporate
airworthiness limitation (AWL) No. 28-AWL-21 or AWL No. 28-AWL-27, as
applicable. The original NPRM resulted from fuel system reviews
conducted by the manufacturer. This supplemental NPRM would revise the
original NPRM by adding airplanes to the applicability, and would
require replacing production-installed laminate phenolic spacers with
metallic spacers between the fuel jettison MOV and the airplane
structure, as applicable. We are proposing this supplemental NPRM to
prevent electrical current from flowing through an MOV actuator into a
fuel tank, which could create a potential ignition source inside the
fuel tank. This condition, in combination with flammable fuel vapors,
could result in a fuel tank explosion and consequent loss of the
airplane.

DATES: We must receive comments on this supplemental NPRM by December
14, 2010.

ADDRESSES: You may send comments by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue, SE., Washington, DC 20590.
     Hand Delivery: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays.
    For service information identified in this proposed AD, contact
Boeing Commercial Airplanes, Attention: Data & Services Management,
P.O. Box 3707, MC 2H-65, Seattle, Washington 98124-2207; telephone 206-
544-5000, extension 1; fax<PHONE_NUMBER>; e-mail<EMAIL_ADDRESS>
Internet https://www.myboeingfleet.com. You may review copies of the
referenced

service information at the FAA, Transport Airplane Directorate, 1601
Lind Avenue, SW., Renton, Washington. For information on the
availability of this material at the FAA, call<PHONE_NUMBER>.

Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov; or in person at the Docket Management Facility
between 9 a.m. and 5 p.m., Monday through Friday, except Federal
holidays. The AD docket contains this proposed AD, the regulatory
evaluation, any comments received, and other information. The street
address for the Docket Office (telephone<PHONE_NUMBER>) is in the
ADDRESSES section. Comments will be available in the AD docket shortly
after receipt.

FOR FURTHER INFORMATION CONTACT: Douglas Bryant, Aerospace Engineer,
Propulsion Branch, ANM-140S, FAA, Seattle Aircraft Certification
Office, 1601 Lind Avenue, SW., Renton, Washington 98057-3356; telephone
(425) 917-6505; fax<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Comments Invited

    We invite you to send any written relevant data, views, or
arguments about this proposed AD. Send your comments to an address
listed under the ADDRESSES section. Include ``Docket No. FAA-2008-0090;
Directorate Identifier 2007-NM-312-AD'' at the beginning of your
comments. We specifically invite comments on the overall regulatory,
economic, environmental, and energy aspects of this proposed AD. We
will consider all comments received by the closing date and may amend
this proposed AD because of those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this proposed AD.

Discussion

    We issued a notice of proposed rulemaking (NPRM) (the ``original
NPRM'') to amend 14 CFR part 39 to include an airworthiness directive
(AD) that would apply to certain Model 747 airplanes. That original
NPRM was published in the Federal Register on January 31, 2008 (73 FR
5773). That original NPRM proposed to require measuring the electrical
bond resistance between the motor operated valve (MOV) actuators and
airplane structure for the main, center, auxiliary, and horizontal
stabilizer fuel tanks, as applicable, and corrective action if
necessary. That original NPRM also proposed to require a revision to
the maintenance program to incorporate airworthiness limitation (AWL)
No. 28-AWL-21 or AWL No. 28-AWL-27, as applicable.

Actions Since Original NPRM Was Issued

    Since we issued the original NPRM, we reviewed Boeing Service
Bulletin 747-28A2292, Revision 2, dated May 13, 2010 (for Model 747-
100, 747-100B, 747-100B SUD, 747-200B, 747-200C, 747-200F, 747-300,
747-400, 747-400D, 747-400F, 747SR, and 747SP series airplanes). This
service bulletin clarifies the procedure for measuring the electrical
bond resistance, and adds procedures for replacing production-installed
laminate phenolic spacers with metallic spacers for airplanes in Groups
12, 16, 17, 18, and 19. This service bulletin also adds airplanes to
the Effectivity. Paragraphs (c) and (g) of this supplemental NPRM have
been revised accordingly.
    We also reviewed Boeing Service Bulletin 747-28A2294, Revision 1,
dated March 5, 2009 (for Model 747-400 series airplanes equipped with
an active horizontal stabilizer fuel tank). This service bulletin is
the same as the original issue, dated September 21, 2007, except that a
reference to Sub-section 28-17-03 of Boeing 747-400 Airplane
Maintenance Manual (AMM) is corrected in Revision 1.
    We reviewed Boeing 747-100/200/300/SP Airworthiness Limitations
(AWLs) and Certification Maintenance Requirements (CMRs), Document D6-
13747-CMR, Revision March 2008 (hereafter referred to as ``Document D6-
13747-CMR''). (We referred to Revision January 2007 of Document D6-
13747-CMR in the original NPRM.) Document D6-13747-CMR revises certain
AWLs for fuel tank systems. However, AWL No. 28-AWL-21, which is
specified in this supplemental NPRM, has not been revised in Document
D6-13747-CMR, Revision March 2008.
    We also reviewed the Boeing 747-400 Maintenance Planning Data (MPD)
Document, Section 9, D621U400-9, Revision December 2009 (hereafter
referred to as ``Boeing 747-400 MPD''). Among other things, Subsection
D of Boeing 747-400 MPD has been revised to clarify the
``Applicability'' of AWL No. 28-AWL-27, which is a critical design
configuration control limitation (CDCCL) to maintain the design
features of the MOV actuator.
    We have revised this supplemental NPRM to refer to the latest
service information described previously.

Other Relevant Rulemaking

    On April 28, 2008, we issued AD 2008-10-07, Amendment 39-15513 (73
FR 25977, May 8, 2008); and on October 30, 2009, we issued AD 2008-10-
07 R1, Amendment 39-16070 (74 FR 56098, November 16, 2009); applicable
to all Boeing Model 747-100, 747-100B, 747-100B SUD, 747-200B, 747-
200C, 747-200F, 747-300, 747SR, and 747SP series airplanes. Those ADs
require revising the maintenance program by incorporating new AWLs for
fuel tank systems to satisfy Special Federal Aviation Regulation No. 88
(``SFAR 88'') requirements. As an optional action, those ADs also allow
incorporating AWL No. 28-AWL-21 into the maintenance program.
Therefore, we have added a new paragraph (n) to this supplemental NPRM
to specify that incorporating AWL No. 28-AWL-21 into the maintenance
program in accordance with paragraph (g) of AD 2008-10-07 or 2008-10-07
R1 terminates the action required by paragraph (k) of this supplemental
NPRM for the applicable airplanes.

Comments

    We gave the public the opportunity to participate in developing
this AD. We considered the comments received from the three commenters.

Request To Allow Use of Future Revisions of the Service Bulletins

    Boeing requested that we revise the original NPRM to specify that
the proposed modifications may also be done in accordance with any
future-approved revisions to Boeing Alert Service Bulletin 747-28A2292,
dated September 14, 2007; and Boeing Alert Service Bulletin 747-
28A2294, dated September 21, 2007. As justification, Boeing stated that
these service bulletins could be revised by the time we issue the AD.
    We partially agree. As discussed previously, we have revised this
supplemental NPRM to refer to the most recently issued service
information. However, we do not agree to refer to ``later revisions.''
To allow operators to use later revisions of the referenced service
documents, either we must revise the AD to reference specific later
revisions, or operators must request approval to use later revisions as
an alternative method of compliance with the AD. Therefore, we have
removed all references to the use of a ``later revision'' of the
applicable service information from this supplemental NPRM to be

consistent with FAA policy. We may consider approving the use of later
revisions of the service information as an AMOC with this AD, as
provided by paragraph (q) of this supplemental NPRM.

Request To Revise Paragraphs (h) and (i) of the Original NPRM

    KLM Royal Dutch Airlines (KLM) stated that the intent of the
original NPRM is to maintain the design features introduced in
accordance with Boeing Alert Service Bulletin 747-28A2292, dated
September 14, 2007; and Boeing Alert Service Bulletin 747-28A2294,
dated September 21, 2007; respectively; when an MOV actuator is
installed. KLM thought that it was clearer if the NPRM stated that the
CDCCLs must be incorporated into the applicable paragraphs of the AMM
to maintain these design features.
    We infer that KLM requests that we revise paragraphs (h) and (i) of
the NPRM as proposed above. We disagree with the commenter's request.
We disagree that incorporating CDCCLs into the AMM is the appropriate
location for a CDCCL. The AMM is not an FAA-approved document. The
appropriate location for a CDCCL is in the FAA-approved section (i.e.,
the Airworthiness Limitations section) of an operator's maintenance
program. We have not changed this supplemental NPRM in this regard.

Request To Exclude a Certain Airplane From the Requirements of
Paragraph (g) of the Original NPRM

    Lufthansa requested that we exclude a certain Model 747-400 series
airplane from paragraph (g) of the original NPRM because the horizontal
stabilizer tank (HST) on that airplane has never been activated.
    We disagree with the request. Although the HST might not be
activated at this time, it could be activated in the future. We cannot
exclude an airplane from the requirements of this supplemental NPRM
without substantiation that the unsafe condition has been adequately
addressed. We have not changed this supplemental NPRM in this regard.

Request To Extend Compliance Time

    Lufthansa requested that we extend the compliance time of the
original NPRM from 60 months to 72 months. Lufthansa stated that this
extension will allow operators to implement the modification at the
next maintenance layover.
    KLM requested that we extend the compliance time of the original
NPRM from 60 months to 96 months. KLM stated that tank entry might be
necessary for accomplishing the actions, and KLM wanted to avoid tank
entry during C-checks.
    We disagree with the commenters' requests to extend the compliance
time. In developing an appropriate compliance time for this
supplemental NPRM, we considered the urgency associated with the
subject unsafe condition and the practical aspect of accomplishing the
required actions on the Model 747 fleet in a timely manner. We
recognize that operators may have different schedules for accomplishing
heavy maintenance, but at the same time, we find that the 60-month
compliance time will include most operators' schedules for that type of
work. Further, according to the provisions of paragraph (q) of this AD,
we may consider approving requests to adjust the compliance time if
those requests include data that prove that the new compliance time
would provide an acceptable level of safety. No change to this
supplemental NPRM is necessary in this regard.

Other Change Made to This Supplemental NPRM

    We have added a new paragraph (m) to this supplemental NPRM to
specify that no alternative CDCCLs may be used unless they are approved
as an AMOC. Inclusion of this paragraph in the supplemental NPRM is
intended to ensure that the AD-mandated airworthiness limitations
changes are treated the same as the airworthiness limitations issued
with the original type certificate.

FAA's Determination and Proposed Requirements of the Supplemental NPRM

    We are proposing this supplemental NPRM because we evaluated all
pertinent information and determined an unsafe condition exists and is
likely to exist or develop on other products of the same type design.
Certain changes described above expand the scope of the original NPRM.
As a result, we have determined that it is necessary to reopen the
comment period to provide additional opportunity for the public to
comment on this supplemental NPRM.

Explanation of Change to Costs of Compliance

    Since issuance of the original NPRM, we have increased the labor
rate used in the Costs of Compliance form $80 per work-hour to $85 per
work-hour. The Costs of Compliance information, below, reflects this
increase in the specified hourly labor rate.
    For convenience to the operator, the Estimated Costs table, below,
was revised to break out the cost of replacing the spacers and the on-
condition costs.

Costs of Compliance

    We estimate that this proposed AD will affect 222 airplanes of U.S.
registry.
    We estimate the following costs to comply with this proposed AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost on U.S.
             Action                    Labor cost            Parts cost      Cost per product      operators
----------------------------------------------------------------------------------------------------------------
Measurement....................  Up to 7 work-hours x    Up to $350.......  Up to $945.......  Up to $209,790.
                                  $85 per hour = Up to
                                  $595.
Replacement (Up to 60            Up to 4 work-hours x    $1,305...........  Up to $1,645.....  Up to $98,700.
 airplanes).                      $85 per hour = Up to
                                  $340.
Maintenance program revision...  1 work-hour x $85 per   $0...............  $85..............  $18,870.
                                  hour = $85.
----------------------------------------------------------------------------------------------------------------

    We estimate the following costs to do any necessary modification
that would be required based on the results of the proposed inspection.
We have no way of determining the number of aircraft that might need
this modification:

                                               On-Condition Costs
----------------------------------------------------------------------------------------------------------------
              Action                      Labor cost             Parts cost              Cost per product
----------------------------------------------------------------------------------------------------------------
Change electrical bond and rework   436 work-hours x $85   Up to $35,760........  Up to $72,820.
 part contact surface.               per hour = $37,060.
----------------------------------------------------------------------------------------------------------------

Authority for This Rulemaking

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

Regulatory Findings

    We determined that this proposed AD would not have federalism
implications under Executive Order 13132. This proposed AD would not
have a substantial direct effect on the States, on the relationship
between the national Government and the States, or on the distribution
of power and responsibilities among the various levels of government.
    For the reasons discussed above, I certify this proposed
regulation:
    1. Is not a ``significant regulatory action'' under Executive Order
12866,
    2. Is not a ``significant rule'' under the DOT Regulatory Policies
and Procedures (44 FR 11034, February 26, 1979), and
    3. Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.
    You can find our regulatory evaluation and the estimated costs of
compliance in the AD Docket.

List of Subjects in 14 CFR Part 39

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

The Proposed Amendment

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

PART 39--AIRWORTHINESS DIRECTIVES

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

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

Sec.  39.13  [Amended]

    2. The FAA amends Sec.  39.13 by adding the following new AD:

The Boeing Company: Docket No. FAA-2008-0090; Directorate Identifier
2007-NM-312-AD.

Comments Due Date

    (a) We must receive comments by December 14, 2010.

Affected ADs

    (b) None.

Applicability

    (c) This AD applies to The Boeing Company Model 747-100, 747-
100B, 747-100B SUD, 747-200B, 747-200C, 747-200F, 747-300, 747-400,
747-400D, 747-400F, 747SR, and 747SP series airplanes, certificated
in any category; as identified in Boeing Service Bulletin 747-
28A2292, Revision 2, dated May 13, 2010.

    Note 1: This AD requires revisions to certain operator
maintenance documents to include new inspections. Compliance with
these inspections is required by 14 CFR 91.403(c). For airplanes
that have been previously modified, altered, or repaired in the
areas addressed by these inspections, the operator may not be able
to accomplish the inspections described in the revisions. In this
situation, to comply with 14 CFR 91.403(c), the operator must
request approval for an alternative method of compliance (AMOC)
according to paragraph (q) of this AD. The request should include a
description of changes to the required inspections that will ensure
the continued operational safety of the airplane.

Subject

    (d) Air Transport Association (ATA) of America Code 28: Fuel.

Unsafe Condition

    (e) This AD results from fuel system reviews conducted by the
manufacturer. The Federal Aviation Administration is issuing this AD
to prevent electrical current from flowing through a motor operated
valve (MOV) actuator into a fuel tank, which could create a
potential ignition source inside the fuel tank. This condition, in
combination with flammable fuel vapors, could result in a fuel tank
explosion and consequent loss of the airplane.

Compliance

    (f) You are responsible for having the actions required by this
AD performed within the compliance times specified, unless the
actions have already been done.

Measurement, Corrective Action, and Replacement

    (g) Within 60 months after the effective date of this AD, do the
actions required by paragraphs (g)(1) and (g)(2) of this AD, as
applicable.
    (1) Measure the electrical bond resistance between the MOV
actuators and the airplane structure for the main, center, and
auxiliary fuel tanks, as applicable; and do all applicable
corrective actions; by accomplishing all of the applicable actions
in the Accomplishment Instructions of Boeing Service Bulletin 747-
28A2292, Revision 2, dated May 13, 2010. The corrective actions must
be accomplished before further flight.
    (2) For airplanes in Groups 12, 16, 17, 18, and 19, as
identified in Boeing Service Bulletin 747-28A2292, Revision 2, dated
May 13, 2010: Within 60 months after the effective date of this AD,
replace production-installed laminate phenolic spacers with metallic
spacers, in accordance with the Accomplishment Instructions of
Boeing Service Bulletin 747-28A2292, Revision 2, dated May 13, 2010.
    (h) For airplanes identified in Boeing Service Bulletin 747-
28A2294, Revision 1, dated March 5, 2009: Within 60 months after the
effective date of this AD, measure the electrical bond resistance
between the MOV actuators and airplane structure for the horizontal
stabilizer (HST) fuel tanks, and do all the applicable corrective
actions, in accordance with the Accomplishment Instructions of
Boeing Service Bulletin 747-28A2294, Revision 1, dated March 5,
2009. The corrective actions must be accomplished before further
flight.

Deactivation of the HST

    (i) For airplanes identified in Boeing Service Bulletin 747-
28A2294, Revision 1, dated March 5, 2009: Deactivation of the HST,
in accordance with the applicable Boeing service information
specified in Table 1 of this AD, terminates the requirements of
paragraph (h) of this AD, except as provided by paragraph (j) of
this AD. Deactivation of the HST before the effective date of this
AD in accordance with the applicable service information specified
in Table 2 of this AD also terminates the requirements of paragraph
(h) of this AD, except as provided by paragraph (j) of this AD.

                Table 1--Deactivation Service Information
------------------------------------------------------------------------
           Boeing--               Revision--             Dated--
------------------------------------------------------------------------
Service Bulletin 747-28-2265.  Original........  February 22, 2006.
Service Bulletin 747-28-2272.  Original........  February 21, 2006.
Service Bulletin 747-28-2274.  1...............  May 21, 2008.
Service Bulletin 747-28-2275.  4...............  February 2, 2009.
Service Bulletin 747-28-2279.  2...............  October 16, 2007.
Service Bulletin 747-28-2285.  3...............  August 30, 2007.
Service Bulletin 747-28-2293.  2...............  March 4, 2008.
Service Bulletin 747-28-2295.  2...............  January 19, 2009.
Service Bulletin 747-28-2296.  Original........  July 13, 2007.
Service Bulletin 747-28-2300.  1...............  June 2, 2008.
Service Bulletin 747-28-2314.  Original........  December 9, 2008.
------------------------------------------------------------------------

            Table 2--Deactivation Credit Service Information
------------------------------------------------------------------------
           Boeing--               Revision--             Dated--
------------------------------------------------------------------------
Service Bulletin 747-28-2274.  Original........  March 13, 2006.
Service Bulletin 747-28-2275.  Original........  June 12, 2006.
Service Bulletin 747-28-2275.  1...............  March 16, 2007.
Service Bulletin 747-28-2275.  2...............  July 2, 2007.
Service Bulletin 747-28-2275.  3...............  March 11, 2008.
Service Bulletin 747-28-2279.  Original........  June 12, 2006.
Service Bulletin 747-28-2279.  1...............  May 25, 2007.
Service Bulletin 747-28-2285.  Original........  January 23, 2007.
Service Bulletin 747-28-2285.  1...............  May 9, 2007.
Service Bulletin 747-28-2285.  2...............  August 3, 2007.
Service Bulletin 747-28-2293.  Original........  May 9, 2007.
Service Bulletin 747-28-2293.  1...............  August 29, 2007.
Service Bulletin 747-28-2295.  Original........  November 17, 2006.
Service Bulletin 747-28-2295.  1...............  March 20, 2008.
Service Bulletin 747-28-2300.  Original........  January 16, 2008
------------------------------------------------------------------------

Reactivation of the HST

    (j) For airplanes identified Boeing Service Bulletin 747-
28A2294, Revision 1, dated March 5, 2009, on which the HST is
reactivated, the HST must be reactivated in accordance with a method
approved by the Manager, Seattle Aircraft Certification Office
(ACO), FAA. For any airplane on which the HST is reactivated, the
requirements of paragraphs (h) and (l) of this AD must be done
before further flight following the reactivation, or within 60
months after the effective date of this AD, whichever occurs later.
For a reactivation method to be approved, the reactivation method
must meet the certification basis of the airplane, and the approval
must specifically reference this AD.

Maintenance Program Revision

    (k) For Model 747-100, 747-100B, 747-100B SUD, 747-200B, 747-
200C, 747-200F, 747-300, 747SR, and 747SP series airplanes:
Concurrently with accomplishing the actions required by paragraph
(g) of this AD, revise the maintenance program by incorporating
airworthiness limitation (AWL) No. 28-AWL-21 of Section D of Boeing
747-100/200/300/SP Airworthiness Limitations (AWLs) and
Certification Maintenance Requirements (CMRs), Document D6-13747-
CMR, Revision March 2008.
    (l) For Model 747-400, 747-400D, and 747-400F series airplanes:
Concurrently with accomplishing the actions required by paragraph
(g) of this AD, revise the maintenance program by incorporating AWL
No. 28-AWL-27 of Subsection D of Boeing 747-400 Maintenance Planning
Data (MPD) Document, Section 9, D621U400-9, Revision December 2009.

No Alternative Critical Design Configuration Control Limitations
(CDCCLs)

    (m) After accomplishing the applicable action required in
paragraph (k) or (l) of this AD, no alternative CDCCLs may be used
unless the CDCCLs are approved as an AMOC in accordance with the
procedures specified in paragraph (q) of this AD.

Terminating Action for Maintenance Program Revision

    (n) For Model 747-100, 747-100B, 747-100B SUD, 747-200B, 747-
200C, 747-200F, 747-300, 747SR, and 747SP series airplanes:
Incorporating AWL No. 28-AWL-21 into the maintenance program in
accordance with paragraph (g) of AD 2008-10-07, Amendment 39-15513;
or AD 2008-10-07 R1, Amendment 39-16070; terminates the action
required by paragraph (k) of this AD.

Actions Accomplished According to Previous Issue of Service Bulletin

    (o) Actions done before the effective date of this AD, in
accordance with Boeing Alert Service Bulletin 747-28A2294, dated
September 21, 2007, are acceptable for compliance with the
corresponding requirements of this AD.

Incorporation of Previous Issues of Airworthiness Limitation (AWL)

    (p) Incorporation of AWL No. 28-AWL-21 of Section D of the
Boeing 747-100/200/300/SP Airworthiness Limitations (AWLs) and
Certification Maintenance Requirements (CMRs), Document D6-13747-
CMR, Revision January 2007, September 2007, or January 2008, is
acceptable for compliance with the corresponding requirements of
this AD if done before the effective date of this AD.

Alternative Methods of Compliance (AMOCs)

    (q)(1) The Manager, Seattle Aircraft Certification Office (ACO),
FAA, has the authority to approve AMOCs for this AD, if requested
using the procedures found in 14 CFR 39.19. Send information to
ATTN: Douglas Bryant, Aerospace Engineer, Propulsion Branch, ANM-
140S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue,
SW., Renton, Washington 98057-3356; telephone<PHONE_NUMBER>; fax
(425) 917-6590. Information may be e-mailed to<EMAIL_ADDRESS>    (2) To request a different method of compliance or a different
compliance time for this AD, follow the procedures in 14 CFR 39.19.
Before using any approved AMOC on any airplane to which the AMOC
applies, notify your principal maintenance inspector (PMI) or
principal avionics inspector (PAI), as appropriate, or lacking a
principal inspector, your local Flight Standards District

Office. The AMOC approval letter must specifically reference this
AD.

    ssued in Renton, Washington on November 10, 2010.
Jeffrey E. Duven,
Acting Manager, Transport Airplane Directorate, Aircraft Certification
Service.
[FR Doc. 2010-29231 Filed 11-18-10; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 77, Number 243 (Tuesday, December 18, 2012)]
[Notices]
[Pages 74894-74895]
[FR Doc No: 2012-30406]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68417; File No. SR-CBOE-2012-119]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Amend the CBOE Stock Exchange Fees Schedule

December 12, 2012.
    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 December 6, 2012, Chicago Board Options Exchange, Incorporated
(the ``Exchange'' or ``CBOE'') filed with the Securities and Exchange
Commission (the ``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.
---------------------------------------------------------------------------

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

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

    The Exchange proposes to amend the Fees Schedule for its CBOE Stock
Exchange (``CBSX''). The text of the proposed rule change is available
on the Exchange's Web site (www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the
Secretary, and at the Commission.

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
    CBSX proposes to increase the Initial Regulatory Review Fee from
$3,000 to

$5,000 and the Monthly Regulatory Fee from $3,000 to $5,000. These fees
both apply to CBSX Trading Permit Holders (``CBSX TPHs'') (CBSX Traders
that are not CBOE Trading Permit Holders (``CBOE TPHs'') but are
granted access to CBSX via a trading permit) who either apply for CBOE
to act as their designated examining authority (``DEA'') or for whom
CBOE acts as a DEA (CBOE handles all regulatory functions for CBSX, and
CBSX pays CBOE for such services). The Initial Regulatory Review Fee is
charged to any CBSX TPH applicant that applies for a CBSX Trading
Permit that, if approved, would result in CBOE serving as the CBSX
TPH's DEA. The Monthly Regulatory Fee is charged to any CBSX TPH for
whom CBOE acts as the CBSX TPH's DEA.
    Processing the applications for CBOE to act as the DEA and acting
as the DEA for these CBSX TPHs are costly and time-intensive, and the
Initial Regulatory Review Fee and the Monthly Regulatory Fee only
partly offset these costs. In the past year, CBOE's CBSX-related
regulatory costs have increased, and the Exchange anticipates such
spending to continue to increase in 2013 due to heightened regulatory
review. As such, the Exchange proposes to increase the amounts of the
Initial Regulatory Review Fee and the Monthly Regulatory Fee in order
to partly offset the regulatory cost increases associated with the
initial regulatory review and acting as a CBSX TPH's DEA.
    The proposed changes are to take effect on January 1, 2013.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\3\ Specifically, the Exchange believes the proposed rule change is
consistent with Section 6(b)(4) of the Act,\4\ which provides that
Exchange rules may provide for the equitable allocation of reasonable
dues, fees, and other charges among its Trading Permit Holders and
other persons using its facilities. Increasing the amounts of the
Initial Regulatory Review Fee and the Monthly Regulatory Fee is
reasonable because such increases are necessary to help offset the
increased regulatory costs associated with the processing of an
application by a CBSX TPH for CBOE to act as that CBSX TPH's DEA and
with the ongoing regulatory review and monitoring that must be
undertaken in order for CBOE to act as a CBSX TPH's DEA. These
increases are equitable and not unfairly discriminatory because they
will apply to all CBSX TPHs to whom the Initial Regulatory Review Fee
and the Monthly Regulatory Fee apply.
---------------------------------------------------------------------------

    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

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

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

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

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

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) \5\ of the Act and paragraph (f) of Rule 19b-4 \6\
thereunder. At any time within 60 days of the filing of the proposed
rule change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78s(b)(3)(A).
    \6\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the 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-CBOE-2012-119 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-CBOE-2012-119. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of 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-CBOE-2012-119 and should be
submitted on or before January 8, 2013.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\7\
---------------------------------------------------------------------------

    \7\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-30406 Filed 12-17-12; 8:45 am]
BILLING CODE 8011-01-P