[Federal Register: July 15, 2009 (Volume 74, Number 134)]
[Rules and Regulations]
[Page 34225-34229]
[DOCID:fr15jy09-8]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2009-0138; Directorate Identifier 2008-NM-216-AD;
Amendment 39-15966; AD 2009-15-03]
RIN 2120-AA64

Airworthiness Directives; Bombardier Model BD-700-1A10 and BD-
700-1A11 Airplanes

AGENCY: Federal Aviation Administration (FAA), Department of
Transportation (DOT).

ACTION: Final rule.

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SUMMARY: We are superseding an existing airworthiness directive (AD)
for the products listed above. This AD results from mandatory
continuing airworthiness information (MCAI) originated by an aviation
authority of another country to identify and correct an unsafe
condition on an aviation product. The MCAI describes the unsafe
condition as:

    During scheduled maintenance inspection, a bolt which connects
the PCU (power control unit) to the elevator surface was found
fractured in the assembly. Further inspection of the assembly
revealed that the bearing on the PCU rod end had seized, which
resulted in damage to the attachment fitting bushing and fracture of
the bolt. Inspection of other in-service airplanes revealed two more
seized PCU attachment joints. However, except seizure, no fractured
bolt was found on these airplanes. Failure of the bolts in both PCUs
on one side could result in disconnection of the elevator control
surface which would lead to flutter and loss of the aircraft.
* * * * *
    We are issuing this AD to require actions to correct the unsafe
condition on these products.

DATES: This AD becomes effective August 19, 2009.
    The Director of the Federal Register approved the incorporation by
reference of certain publications listed in this AD as of August 19,
2009.

ADDRESSES: You may examine the AD docket on the Internet at http://
www.regulations.gov or in person at the U.S. Department of
Transportation, Docket Operations, M-30, West Building Ground Floor,
Room W12-140, 1200 New Jersey Avenue, SE., Washington, DC.

FOR FURTHER INFORMATION CONTACT: Pong K. Lee, Aerospace Engineer,
Airframe and Propulsion Branch, ANE-171, FAA, New York Aircraft
Certification Office, 1600 Stewart Avenue, Suite 410, Westbury, New
York 11590; telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

Discussion

    We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR
part 39 to include an AD that would apply to the specified products.
That NPRM was published in the Federal Register on February 23, 2009
(74 FR 8045). That NPRM proposed to correct an unsafe condition for the
specified products. The MCAI states:

    During scheduled maintenance inspection, a bolt which connects
the PCU (power control unit) to the elevator surface was found
fractured in the assembly. Further inspection of the assembly
revealed that the bearing on the PCU rod end had seized, which
resulted in damage to the attachment fitting bushing and fracture of
the bolt. Inspection of other in-service airplanes revealed two more
seized PCU attachment joints. However, except seizure, no fractured
bolt was found on these airplanes. Failure of the bolts in both PCUs
on one side could result in disconnection of the elevator control
surface which would lead to flutter and loss of the aircraft.
    This Airworthiness Directive (AD) is issued to mandate the
inspection and

lubrication of all part number (P/N) GT411-3800-5 and GT411-3800-7
PCU attachment joints.

    The required actions include inspections for damage and seizure
(including signs of seizure) of the PCU attachment joints, an
inspection for damage (including wear damage, fretting, corrosion,
galling, scoring, fretting wear, and parts that do not meet inspection
requirements) of the PCU attachment joint components, and applicable
corrective actions. You may obtain further information by examining the
MCAI in the AD docket.

Explanation of Revised Service Information

    Bombardier has issued the revised service information specified in
the below table. We have changed paragraphs (f)(1) through (f)(5),
paragraph (f)(7), and paragraphs (g)(1) and (g)(2) of this AD to add
the revised service information specified in the following table.

                                           Revised Service Information
----------------------------------------------------------------------------------------------------------------
                                                     Revision
                 Service Bulletin                     level                           Date
----------------------------------------------------------------------------------------------------------------
Bombardier Alert Service Bulletin A700-1A11-27-024         02  November 10, 2008.
Bombardier Alert Service Bulletin A700-27-066.....         02  November 10, 2008.
Bombardier Service Bulletin 700-1A11-27-025.......         01  November 24, 2008.
Bombardier Service Bulletin 700-27-067............         01  November 24, 2008.
----------------------------------------------------------------------------------------------------------------

    No additional work is necessary for airplanes on which the
previously issued service information specified in the following table
has been accomplished. We have revised paragraph (f)(6) and added a new
paragraph (g)(3) to this AD to include credit for accomplishing the
actions before the effective date of this AD using the previously
issued service information.

                                      Previously Issued Service Information
----------------------------------------------------------------------------------------------------------------
                                                     Revision
                 Service Bulletin                     level                           Date
----------------------------------------------------------------------------------------------------------------
Bombardier Alert Service Bulletin A700-1A11-27-024         01  October 3, 2008.
Bombardier Alert Service Bulletin A700-27-066.....         01  October 3, 2008.
Bombardier Service Bulletin 700-1A11-27-025.......      (\1\)  October 9, 2008.
Bombardier Service Bulletin 700-27-067............      (\1\)  October 9, 2008.
----------------------------------------------------------------------------------------------------------------
\1\ Original.

Comments

    We gave the public the opportunity to participate in developing
this AD. We received no comments on the NPRM or on the determination of
the cost to the public.
    We reviewed the available data and determined that air safety and
the public interest require adopting the AD with the changes described
previously. We determined that these changes will not increase the
economic burden on any operator or increase the scope of the AD.

Differences Between This AD and the MCAI or Service Information

    We have reviewed the MCAI and related service information and, in
general, agree with their substance. But we might have found it
necessary to use different words from those in the MCAI to ensure the
AD is clear for U.S. operators and is enforceable. In making these
changes, we do not intend to differ substantively from the information
provided in the MCAI and related service information.
    We might also have required different actions in this AD from those
in the MCAI in order to follow our FAA policies. Any such differences
are highlighted in a NOTE within the AD.

Costs of Compliance

    We estimate that this AD will affect about 157 products of U.S.
registry.
    We estimate that it will take about 4 work-hours per product to
comply with the basic requirements of this AD. The average labor rate
is $80 per work-hour. Based on these figures, we estimate the cost of
this AD to the U.S. operators to be $50,240, or $320 per product.

Authority for This Rulemaking

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

Regulatory Findings

    We determined that this AD will not have federalism implications
under Executive Order 13132. This AD will not have a substantial direct
effect on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.
    For the reasons discussed above, I certify this AD:
    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.

    We prepared a regulatory evaluation of the estimated costs to
comply with this AD and placed it in the AD docket.

Examining the AD Docket

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

List of Subjects in 14 CFR Part 39

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

Adoption of the Amendment

0
Accordingly, under the authority delegated to me by the Administrator,
the FAA amends 14 CFR part 39 as follows:

PART 39--AIRWORTHINESS DIRECTIVES

0
1. The authority citation for part 39 continues to read as follows:

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

Sec.  39.13  [Amended]

0
2. The FAA amends Sec.  39.13 by removing Amendment 39-15753 (73 FR
72316, November 28, 2008) and adding the following new AD:

2009-15-03 Bombardier, Inc.: Amendment 39-15966. Docket No. FAA-
2009-0138; Directorate Identifier 2008-NM-216-AD.

Effective Date

    (a) This airworthiness directive (AD) becomes effective August
19, 2009.

Affected ADs

    (b) This AD supersedes AD 2008-24-12, Amendment 39-15753.

Applicability

    (c) This AD applies to Bombardier Model BD-700-1A10 and BD-700-
1A11 airplanes, certificated in any category, serial numbers (S/Ns)
9002 through 9222 inclusive; equipped with elevator power control
units (PCUs) having part number (P/N) GT411-3800-5 or GT411-3800-7.

Subject

    (d) Air Transport Association (ATA) of America Code 27: Flight
controls.

Reason

    (e) The mandatory continuing airworthiness information (MCAI)
states:
    During scheduled maintenance inspection, a bolt which connects
the PCU (power control unit) to the elevator surface was found
fractured in the assembly. Further inspection of the assembly
revealed that the bearing on the PCU rod end had seized, which
resulted in damage to the attachment fitting bushing and fracture of
the bolt. Inspection of other in-service airplanes revealed two more
seized PCU attachment joints. However, except seizure, no fractured
bolt was found on these airplanes. Failure of the bolts in both PCUs
on one side could result in disconnection of the elevator control
surface which would lead to flutter and loss of the aircraft.
    This Airworthiness Directive (AD) is issued to mandate the
inspection and lubrication of all part number (P/N) GT411-3800-5 and
GT411-3800-7 PCU attachment joints.
    The required actions include inspections for damage and seizure
(including signs of seizure) of the PCU attachment joints, an
inspection for damage (including wear damage, fretting, corrosion,
galling, scoring, fretting wear, and parts that do not meet
inspection requirements) of the PCU attachment joint components, and
applicable corrective actions.

Restatement of Requirements of AD 2008-24-12:

    (f) Unless already done: For airplanes on which elevator PCUs
with P/N GT411-3800-5 or P/N GT411-3800-7, S/N 0615 and lower, are
installed, excluding P/N GT411-3800-7 PCUs having a serial number
listed in Table 1 of this AD, and excluding P/N GT411-3800-7 PCUs on
which less than 1,000 flight hours have accumulated on the PCUs as
of December 15, 2008 (the effective date of AD 2008-24-12), do the
actions specified in paragraphs (f)(1), (f)(2), and (f)(3) of this
AD.

    Note 1: Units listed in Table 1 of this AD have been lubricated
by the vendor and the inspections required by paragraphs (f)(1),
(f)(2), (f)(3), and (f)(4) of this AD are not required for those
units.

                         Table 1--Serial Numbers
------------------------------------------------------------------------

------------------------------------------------------------------------
                   0030                                 0199
                   0031                                 0202
                   0033                                 0205
                   0041                                 0206
                   0046                                 0208
                   0060                                 0210
                   0062                                 0214
                   0066                                 0218
                   0081                                 0222
                   0083                                 0223
                   0087                                 0240
                   0092                                 0262
                   0097                                 0265
                   0101                                 0281
                   0105                                 0296
                   0108                                 0301
                   0109                                 0310
                   0111                                 0323
                   0110                                 0365
                   0119                                 0369
                   0130                                 0406
                   0138                                 0407
                   0141                                 0408
                   0145                                 0413
                   0156                                 0420
                   0161                                 0427
                   0163                                 0429
                   0164                                 0430
                   0165                                 0431
                   0171                                 0433
                   0173                                 0435
                   0174                                 0438
                   0178                                 0453
                   0179                                 0491
                   0181                                 0495
                   0183                                 0504
                   0188                                 0506
                   0190                                 0513
                   0191                                 0533
                   0197                                 0536
                   0198                                 0586
------------------------------------------------------------------------

    (1) Within 10 flight cycles or 50 flight hours after December
15, 2008, whichever occurs first: Inspect for damage and wear and
lubricate the PCU attachment joints in accordance with Bombardier
Alert Service Bulletin A700-1A11-27-024, Revision 02, dated November
10, 2008; or Bombardier Alert Service Bulletin A700-27-066, Revision
02, dated November 10, 2008; as applicable.
    (2) Within 90 days or 200 flight hours after performing the
actions required by paragraph (f)(1) of this AD, whichever occurs
first: Repeat the inspection and lubrication of the PCU attachment
joints in accordance with Bombardier Alert Service Bulletin A700-
1A11-27-024, Revision 02, dated November 10, 2008; or Bombardier
Alert Service Bulletin A700-27-066, Revision 02, dated November 10,
2008; as applicable.
    (3) Within 45 days or 100 flight hours after performing the
actions required by paragraph (f)(2) of this AD, whichever occurs
first: Repeat the inspection and lubrication of the PCU attachment
joints in accordance with Bombardier Alert Service Bulletin A700-
1A11-27-024, Revision 02, dated November 10, 2008; or Bombardier
Alert Service Bulletin A700-27-066, Revision 02, dated November 10,
2008; as applicable. Repeat the inspection thereafter at intervals
not to exceed 45 days or 100 flight hours, whichever occurs first,
until paragraph (f)(4) of this AD is accomplished.
    (4) Completion of a disassembly with an inspection for damage,
applicable corrective actions, and lubrication of the PCU attachment
joint components in accordance with Bombardier Service Bulletin 700-
1A11-27-025, Revision 01, dated November 24, 2008; or Bombardier
Service Bulletin 700-27-067, Revision 01, dated November 24, 2008;
as applicable; constitutes terminating action for the inspections
required by paragraphs (f)(1), (f)(2), and (f)(3) of this AD.
    (5) Unless already done, if any damage or seizure is found
during any inspection required by paragraphs (f)(1), (f)(2), (f)(3),
and (f)(4) of this AD, before further flight, replace the affected
part in accordance with Bombardier Service Bulletin 700-1A11-27-025,
Revision 01, dated November 24, 2008; or Bombardier Service Bulletin
700-27-067, Revision 01, dated November 24, 2008; as applicable.

    (6) Actions done before December 15, 2008, in accordance with
Bombardier Alert Service Bulletin A700-1A11-27-024 or Bombardier
Alert Service Bulletin A700-27-066, both dated October 2, 2008; or
Revision 01, both dated October 3, 2008; as applicable; are
acceptable for compliance with the corresponding requirements of
this AD.
    (7) Unless already done, submit a report to Bombardier of all
findings found during any inspection required by paragraphs (f)(1),
(f)(2), (f)(3), and (f)(4) of this AD, in accordance with the
applicable service bulletin listed in Table 2 of this AD.
    (i) If the inspection was done on or after December 15, 2008:
Submit the report within 14 days after the inspection.
    (ii) If the inspection was done before December 15, 2008: Submit
the report within 14 days after December 15, 2008.

                                     Table 2--Service Bulletins for Reports
----------------------------------------------------------------------------------------------------------------
                                                     Revision
                 Service Bulletin                     level                           Date
----------------------------------------------------------------------------------------------------------------
Bombardier Alert Service Bulletin A700-1A11-27-024         02  November 10, 2008.
Bombardier Alert Service Bulletin A700-27-066.....         02  November 10, 2008.
Bombardier Service Bulletin 700-1A11-27-025.......         01  November 24, 2008.
Bombardier Service Bulletin 700-27-067............         01  November 24, 2008.
----------------------------------------------------------------------------------------------------------------

New Requirements of This AD: Actions and Compliance

    (g) Unless already done, do the actions specified in paragraph
(g)(1) or (g)(2) of this AD, as applicable, at the time specified.
    (1) For airplanes identified in paragraph (f) of this AD: Within
45 days or 100 flight hours after the effective date of this AD,
whichever occurs first, complete a disassembly with an inspection
for damage, applicable corrective actions, and lubrication of the
PCU attachment joint components in accordance with Bombardier
Service Bulletin 700-1A11-27-025, Revision 01, dated November 24,
2008; or Bombardier Service Bulletin 700-27-067, Revision 01, dated
November 24, 2008; as applicable.
    (2) For airplanes not identified in paragraph (f) of this AD on
which elevator PCUs with P/N GT411-3800-7 are installed: Within 180
days or 400 flight hours after the effective date of this AD,
whichever occurs first, complete a disassembly with an inspection
for damage, applicable corrective actions, and lubrication of the
PCU attachment joint components in accordance with Bombardier
Service Bulletin 700-1A11-27-025, Revision 01, dated November 24,
2008; or Bombardier Service Bulletin 700-27-067, Revision 01, dated
November 24, 2008; as applicable.
    (3) Actions done before the effective date of this AD in
accordance with Bombardier Service Bulletin 700-1A11-27-025, dated
October 9, 2008; or Bombardier Service Bulletin 700-27-067, dated
October 9, 2008; as applicable; are acceptable for compliance with
the corresponding requirements of this AD.

FAA AD Differences

    Note 2: This AD differs from the MCAI and/or service information
as follows: Paragraph A.3. of the MCAI requires a one-time
inspection; however, since we have changed the compliance time for
the terminating action in paragraph A.4. of the MCAI (refer to
paragraph (g)(1) of this AD), paragraph (f)(3) of this AD requires
repeating the inspections until the terminating action is performed.

Other FAA AD Provisions

    (h) The following provisions also apply to this AD:
    (1) Alternative Methods of Compliance (AMOCs): The Manager, New
York 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: Pong K. Lee, Aerospace
Engineer, Airframe and Propulsion Branch, ANE-171, FAA, New York
ACO, 1600 Stewart Avenue, Suite 410, Westbury, New York 11590;
telephone<PHONE_NUMBER>; fax<PHONE_NUMBER>. 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.
    (2) Airworthy Product: For any requirement in this AD to obtain
corrective actions from a manufacturer or other source, use these
actions if they are FAA-approved. Corrective actions are considered
FAA-approved if they are approved by the State of Design Authority
(or their delegated agent). You are required to assure the product
is airworthy before it is returned to service.
    (3) Reporting Requirements: For any reporting requirement in
this AD, under the provisions of the Paperwork Reduction Act, the
Office of Management and Budget (OMB) has approved the information
collection requirements and has assigned OMB Control Number 2120-
0056.
    (4) Special Flight Permits: As described in Section 21.197 and
Section 21.199 of the Federal Aviation Regulations (14 CFR 21.197
and 21.199), special flight permits are not allowed.

Related Information

    (i) Refer to MCAI Canadian Emergency Airworthiness Directive CF-
2008-31, dated October 9, 2008, and the service information
specified in Table 2 of this AD, for related information.

Material Incorporated by Reference

    (j) You must use the service information contained in Table 3 of
this AD to do the actions required by this AD, as applicable, unless
the AD specifies otherwise.

                                   Table 3--Material Incorporated by Reference
----------------------------------------------------------------------------------------------------------------
                                                     Revision
                     Document                         level                           Date
----------------------------------------------------------------------------------------------------------------
Bombardier Alert Service Bulletin A700-1A11-27-024         02  November 10, 2008.
Bombardier Alert Service Bulletin A700-27-066.....         02  November 10, 2008.
Bombardier Service Bulletin 700-1A11-27-025.......         01  November 24, 2008.
Bombardier Service Bulletin 700-27-067............         01  November 24, 2008.
----------------------------------------------------------------------------------------------------------------

    (1) The Director of the Federal Register approved the
incorporation by reference of the service information under 5 U.S.C.
552(a) and 1 CFR part 51.
    (2) For service information identified in this AD, contact
Bombardier, Inc., 400 C[ocirc]te-Vertu Road West, Dorval,
Qu[eacute]bec H4S 1Y9, Canada; telephone<PHONE_NUMBER>; fax 514-855-
7401; e-mail<EMAIL_ADDRESS>Internet http://
www.bombardier.com.
    (3) You may review copies of the 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> or<PHONE_NUMBER>.
    (4) You may also review copies of the service information that
is incorporated by reference at the National Archives and Records
Administration (NARA). For

information on the availability of this material at NARA, call 202-
741-6030, or go to: http://www.archives.gov/federal_register/code_
of_federal_regulations/ibr_locations.html.

    Issued in Renton, Washington, on July 2, 2009.
Ali Bahrami,
Manager, Transport Airplane Directorate, Aircraft Certification
Service.
[FR Doc. E9-16467 Filed 7-14-09; 8:45 am]

BILLING CODE 4910-13-P


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[Federal Register: December 28, 2009 (Volume 74, Number 247)]
[Notices]
[Page 68643-68644]
[DOCID:fr28de09-98]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61177; File No. SR-NYSE-2009-105]

Self-Regulatory Organizations; New York Stock Exchange LLC; Order
Approving a Proposed Rule Change Relating to the Designation of NYSE
Arca, Inc., as the NYSE's Alternative Trading Facility in an Emergency

December 16, 2009.

I. Introduction

    On October 13, 2009, the New York Stock Exchange LLC (``NYSE'' or
``Exchange'') 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
proposal to adopt NYSE Rule 49, ``Emergency Powers,'' to allow a
qualified NYSE officer to designate the NYSE's corporate affiliate,
NYSE Arca, Inc. (``NYSE Arca'') to receive and process bids and offers
in NYSE-listed securities and to execute orders in NYSE-listed
securities on behalf of the NYSE in the event that an emergency
condition prevents the NYSE from operating normally.\3\ The proposed
rule change was published for comment in the Federal Register on
November 12, 2009.\4\ The Commission received no comments regarding the
proposal. This order approves the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ The Commission today is approving a companion proposal by
NYSE Arca that allows NYSE Arca to serve as the NYSE's alternative
trading facility in the event of an emergency condition. See
Securities Exchange Act Release No. 61178 (order approving File No.
SR-NYSE Arca-2009-90) (``NYSE Arca Order'').
    \4\ See Securities Exchange Act Release No. 60922 (November 3,
2009), 74 FR 58341 (``Notice'').
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II. Description of the Proposal

    The NYSE proposes to adopt NYSE Rule 49 to provide a qualified NYSE
officer with the authority to declare an emergency condition with
respect to trading on or through the systems and facilities of the
NYSE.\5\ An emergency condition will not be declared under NYSE Rule 49
unless: (i) There exists a regional or national emergency that would
prevent the NYSE from operating normally; and (ii) such declaration is
necessary so that the securities markets in general, and the NYSE's
systems and facilities, including the Trading Floor, in particular, may
continue to operate in a manner consistent with the protection of
investors and in pursuit of the public interest.\6\ For purposes of
NYSE Rule 49, an ``emergency'' is an emergency as defined in Section
12(k)(7) of the Act,\7\ and the NYSE's authority under NYSE Rule 49 is
intended to be invoked only in the event of such an emergency.\8\ The
NYSE will make reasonable efforts to contact the Commission prior to
taking action under NYSE Rule 49.\9\
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    \5\ For purposes of NYSE Rule 49, a ``qualified Exchange
officer'' is the NYSE Euronext Chief Executive Officer or his or her
designee, or the NYSE Regulation, Inc. Chief Executive Officer or
his or her designee. If these individuals are unable to act due to
incapacitation, the most senior surviving officer of NYSE Euronext
or NYSE Regulation, Inc. will be a ``qualified Exchange officer''
for purposes of NYSE Rule 49. See NYSE Rule 49(a)(3)(ii).
    \6\ See NYSE Rule 49(a)(2).
    \7\ 15 U.S.C. 78l(k)(7).
    \8\ See NYSE Rule 49(a)(3)(i) and Notice, supra note 4, at note
5 and accompanying text.
    \9\ See NYSE Rule 49(c)(1).
---------------------------------------------------------------------------

    In the event that an emergency condition is declared with respect
to trading on or through the NYSE's systems and facilities, the NYSE
may designate its corporate affiliate, NYSE Arca, to receive and
process bids and offers in NYSE-listed securities and to execute orders
in NYSE-listed securities on behalf of the NYSE.\10\ Thus, the NYSE
would use NYSE Arca as the execution engine for NYSE trades and would
ensure that these trades are executed in compliance with Regulation NMS
under the Act.\11\ Under NYSE Rule 49, quotes or orders for NYSE-listed
securities entered or executed on or through the systems and facilities
of NYSE Arca would be reported to the Consolidated Quotation System or
the Consolidated Tape as quotations or executions, respectively, made
on or through the systems and facilities of the NYSE.\12\ Bids and
offers entered pursuant to NYSE Rule 49 would be deemed to be bids and
offers of the NYSE.\13\
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    \10\ See NYSE Rule 49(b)(1).
    \11\ See Notice, supra note 4, at note 9.
    \12\ See NYSE Rule 49(b)(2)(ii). Accordingly, for the duration
of the emergency condition, trades in NYSE-listed securities would
print as ``N'' trades on the Consolidated Tape and quotes would be
designated as NYSE quotes in the Consolidated Quotation System,
notwithstanding the fact that they were processed on or through the
systems and facilities of NYSE Arca. See Notice, supra note 4, at
note 14 and accompanying text.
    \13\ See NYSE Rule 49(b)(3)(i).
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    NYSE members and Sponsored Participants would be permitted to enter
quotations and to execute orders on or through the systems and
facilities of NYSE Arca regardless of whether they were members or
sponsored participants of NYSE Arca when the emergency condition was
declared.\14\ NYSE members registered as Designated Market Makers
(``DMMs'') that are designated as temporary members of NYSE Arca in
accordance with the NYSE Arca Equities Rules (``NYSE Arca Rules'') \15\
would not be considered DMMs for the duration of the designation, but
would be considered ``Market Makers'' pursuant to NYSE Arca Rules for
the purpose of trading Exchange-listed securities on and through the
systems and facilities of NYSE Arca.\16\
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    \14\ See NYSE Rule 49(b)(3)(i)(A). As described in greater
detail in the Notice, supra note 4, NYSE Arca will provide temporary
membership and/or access to NYSE members and Sponsored Participants
that are not already NYSE Arca members or sponsored participants
when the emergency condition is declared. Similarly, the NYSE may
designate NYSE Arca members that are not members of the NYSE at the
time the emergency condition is declared as temporary members of the
NYSE, and may authorize temporary access for sponsored participants
of NYSE Arca that do not have sponsored access to the NYSE. The
temporary memberships or access will be valid only until regular
trading resumes on the NYSE's systems and facilities. See NYSE Rule
49(b)(3)(ii) and (iii).
    \15\ See NYSE Arca Rule 2.100(b)(3)(i)(C) (approved in the NYSE
Arca Order, supra note 3).
    \16\ See NYSE Rule 49(b)(3)(i)(B). According to the NYSE, NYSE
Arca is not able to support DMMs operating in the same manner as
they operate on the NYSE because of differences between the systems
of the NYSE and NYSE Arca. The NYSE notes that DMMs will not have
access to orders on the NYSE Arca system different from that of
other market participants. DMMs designated as Market Makers under
the NYSE Arca Rules will be obligated to meet the requirements of
those rules. See Notice, supra note 4, at note 13 and accompanying
text.
---------------------------------------------------------------------------

    All trades in Exchange-listed securities entered or executed on or
through the systems and facilities of

NYSE Arca would be subject to NYSE Arca Rules governing trading, and
such rules would be considered NYSE rules for the purposes of such
transactions, except that: (1) NYSE rules governing member firm
conduct, including membership requirements and net capital
requirements, will continue to apply to NYSE members and Sponsored
Participants; and (2) NYSE listing requirements for all listed
securities will continue to apply.\17\
---------------------------------------------------------------------------

    \17\ See NYSE Rule 49(b)(4).
---------------------------------------------------------------------------

    NYSE Arca would conduct surveillance of trading in NYSE-listed
securities on or through the systems and facilities of NYSE Arca on
behalf of the NYSE.\18\ NYSE members would remain subject to the NYSE's
jurisdiction for any disciplinary action related to the trading of
NYSE-listed securities on or through the facilities of NYSE Arca.\19\
---------------------------------------------------------------------------

    \18\ See NYSE Rule 49(b)(5)(i).
    \19\ See NYSE Rule 49(b)(5)(ii).
---------------------------------------------------------------------------

    The authority granted pursuant to NYSE Rule 49 would remain
operative for up to 10 calendar days from the date the NYSE invokes
such authority, and the NYSE may terminate actions taken pursuant to
the rule at any time.\20\ The NYSE may request an extension of this
initial 10-day period for a specified amount of time by filing a
proposed rule change with the Commission pursuant to Section 19(b)(2)
of the Act, and the Commission must approve the NYSE's proposal before
any such extension could take effect.\21\
---------------------------------------------------------------------------

    \20\ See NYSE Rule 49(c)(2) and (3). The NYSE will provide
adequate prior notice to members, Sponsored Participants, and
investors regarding its intention to terminate any action taken
under the rule. See NYSE Rule 49(c)(3).
    \21\ Id.
---------------------------------------------------------------------------

III. Discussion and Commission Findings

    The Commission finds that the proposed rule change is consistent
with the requirements of the Act and the rules and regulations
thereunder applicable to a national securities exchange.\22\ In
particular, the Commission finds that the proposal is consistent with
Section 6(b)(5) of the Act,\23\ which requires, in part, that the rules
of a national securities exchange be designed to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, 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.
---------------------------------------------------------------------------

    \22\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. 15 U.S.C. 78c(f).
    \23\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Commission believes that the proposal is reasonably designed to
permit the NYSE to continue to operate in the event of an emergency, as
defined in Section 12(k)(7) of the Act, by allowing the NYSE to
designate its corporate affiliate, NYSE Arca, to receive and process
quotations in NYSE-listed securities and to execute orders in NYSE-
listed securities on behalf of the NYSE in the event of such an
emergency.\24\ The NYSE would invoke its authority under NYSE Rule 49
only in an emergency, as defined in Section 12(k)(7) of the Act.\25\
The NYSE will make reasonable efforts to consult with the Commission
prior to taking action under NYSE Rule 49.\26\ Any action taken under
NYSE Rule 49 would be operative for up to 10 calendar days from the
date that the NYSE invokes its authority under the rule, and the NYSE
may terminate action taken under the rule at any time.\27\ To extend an
action taken pursuant to NYSE Rule 49 beyond the initial 10-calendar
day period, the NYSE must file a proposed rule change with the
Commission pursuant to Section 19(b)(2) under the Act, and the
Commission would need to approve such an extension before it could take
effect.\28\ In addition, the Commission could, at any time, exercise
its authority under Section 12(k)(2) of the Act \29\ to terminate an
action taken by the NYSE under NYSE Rule 49.
---------------------------------------------------------------------------

    \24\ The Commission previously has approved proposals by other
national securities exchanges to establish back-up trading
arrangements. See, e.g., Securities Exchange Act Release Nos. 51717
(May 19, 2005), 70 FR 30160 (May 25, 2005) (File No. SR-CBOE-2004-
59) (approving proposal by the Chicago Board Options Exchange,
Incorporated to enter into back-up trading arrangements with other
exchanges); 51926 (June 27, 2005), 70 FR 38232 (July 1, 2005) (File
No. SR-Phlx-2004-65) (approving proposal by the Philadelphia Stock
Exchange (``Phlx'') to enter into back-up trading arrangements with
other exchanges); 40088 (June 12, 1998), 63 FR 33426 (June 18, 1998)
(File No. SR-Phlx-98-25) (approving the trading of Dell options
listed on the Phlx at the American Stock Exchange on a temporary
basis); and 27365 (October 19, 1989), 54 FR 43511 (October 25, 1989)
(File Nos. SR-Amex-89-26; CBOE-89-21; PSE-89-28; and Phlx-89-52)
(approving proposals to trade options listed on the Pacific Stock
Exchange on other exchanges following an earthquake).
    \25\ See NYSE Rule 49(a)(1) and (3). See also note 8, supra, and
accompanying text.
    \26\ See NYSE Rule 49(c)(1).
    \27\ See NYSE Rule 49(c)(2) and (3). The NYSE will provide
adequate prior notice to members, Sponsored Participants, and
investors of its intention to terminate any action taken pursuant to
NYSE Rule 49. See NYSE Rule 49(c).
    \28\ See NYSE Rule 49(c)(2).
    \29\ 15 U.S.C. 78l(k)(2).
---------------------------------------------------------------------------

    NYSE Rule 49 also addresses surveillance and the disciplinary
procedures that would apply in the event that NYSE Arca serves as the
NYSE's alternative trading facility, as provided in the rule. In
particular, NYSE Arca would conduct surveillance of trading in
Exchange-listed securities on behalf of the NYSE.\30\ NYSE members and
member organizations would remain subject to the NYSE's jurisdiction
for any disciplinary actions related to the trading of NYSE-listed
securities on or through the systems and facilities of NYSE Arca, and
violations of NYSE Arca's rules would be referred to the NYSE for
prosecution according to the NYSE's disciplinary rules.\31\
---------------------------------------------------------------------------

    \30\ See NYSE Rule 49(b)(5)(i).
    \31\ See NYSE Rule 49(b)(5)(ii).
---------------------------------------------------------------------------

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\32\ that the proposed rule change (File No. SR-NYSE-2009-105) is
approved.
---------------------------------------------------------------------------

    \32\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\33\
---------------------------------------------------------------------------

    \33\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-30596 Filed 12-24-09; 8:45 am]

BILLING CODE 8011-01-P


[Federal Register Volume 79, Number 74 (Thursday, April 17, 2014)]
[Notices]
[Pages 21818-21821]
[FR Doc No: 2014-08687]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-71934; File No. SR-NYSEMKT-2014-30]

Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and
Immediate Effectiveness of Proposed Rule Change Amending the
Professional User Fees for NYSE Amex Options Market Data, Operative on
April 1, 2014

April 11, 2014.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that on March 31, 2014, NYSE MKT LLC (the ``Exchange'' or ``NYSE
MKT'') 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 self-regulatory
organization. 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\ 15 U.S.C. 78a.
    \3\ 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 Professional User fees for NYSE
Amex Options market data, operative on April 1, 2014. The text of the
proposed rule change is available on the Exchange's Web site at
www.nyse.com, 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 self-regulatory organization
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 those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

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

1. Purpose
    The Exchange proposes to amend the Professional User fees for NYSE
Amex Options market data, operative on April 1, 2014.
    On October 1, 2012, the Exchange began offering the following real-
time options market data products: ArcaBook for Amex Options--Trades,
ArcaBook for Amex Options--Top of Book, ArcaBook for Amex Options--
Depth of Book, ArcaBook for Amex Options--Complex, ArcaBook for Amex
Options--Series Status, and ArcaBook for Amex Options--Order Imbalance
(collectively, ``Amex Options Products'').\4\ Fees cover all six
products.\5\ From that time until May 1, 2013, the Exchange charged
Professional Users $50 per month for each User per Source for the
receipt and use of the Amex Options Products. Effective May 1, 2013,
the Exchange introduced the following tiered fee structure for display
usage by Professional Users based on the number of users: \6\
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 67719 (Aug. 23,
2012), 77 FR 52767 (Aug. 30, 2012) (SR-NYSEMKT-2012-40).
    \5\ See SR-NYSEMKT-2013-35 (establishing a fee schedule) and
Securities Exchange Act Release No. 68004 (Oct. 9, 2012), 77 FR
62582 (Oct. 15, 2012) (SR-NYSEMKT-2012-49) (establishing fees for
Amex Options Products). Amex Options Products are not offered with
separate fees for the individual underlying products.
    \6\ See Securities Exchange Act Release No. 69553 (May 10,
2013), 78 FR 28926 (May 16, 2013) (SR-NYSEMKT-2013-40).

------------------------------------------------------------------------
                                                            Fee per
                 Professional users                    professional user
------------------------------------------------------------------------
1-50................................................                 $50
51-100..............................................                  35
101+................................................                  20
------------------------------------------------------------------------

    Because the tiered pricing has not encouraged customers to provide
access to the Exchange's market data to a greater number of
Professional Users as anticipated, the Exchange proposes to return to
the flat fee of $50 per month for each Professional User. The Exchange
does not propose to make any other changes to the fees for Amex Options
Products.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\7\ in general, and
Sections 6(b)(4) and 6(b)(5) of the Act,\8\ in particular, in that

it provides an equitable allocation of reasonable fees among users and
recipients of the data and is not designed to permit unfair
discrimination among customers, issuers, and brokers.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4), (5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed change is reasonable
because it returns Professional User fees to the level that was charged
from October 2012 to May 2013. The current tiered pricing structure has
not encouraged sufficient customers to provide access to the Exchange's
market data to a greater number of Professional Users as the Exchange
anticipated. The proposed fee is equitable and not unfairly
discriminatory because the same fee will be charged to all Professional
Users.
    The Exchange also notes that purchasing Amex Options Products is
entirely optional. Firms are not required to purchase them and have a
wide variety of alternative options market data products from which to
choose. Moreover, the Exchange is not required to make these
proprietary data products available or to offer any specific pricing
alternatives to any customers.
    The decision of the United States Court of Appeals for the District
of Columbia Circuit in NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir.
2010), upheld reliance by the Securities and Exchange Commission
(``Commission'') upon the existence of competitive market mechanisms to
set reasonable and equitably allocated fees for proprietary market
data:

    In fact, the legislative history indicates that the Congress
intended that the market system `evolve through the interplay of
competitive forces as unnecessary regulatory restrictions are
removed' and that the SEC wield its regulatory power `in those
situations where competition may not be sufficient,' such as in the
creation of a `consolidated transactional reporting system.'

    Id. at 535 (quoting H.R. Rep. No. 94-229 at 92 (1975), as reprinted
in 1975 U.S.C.C.A.N. 323). The court agreed with the Commission's
conclusion that ``Congress intended that `competitive forces should
dictate the services and practices that constitute the U.S. national
market system for trading equity securities.' '' \9\ The Exchange
believes that this is also true with respect to options markets.
---------------------------------------------------------------------------

    \9\ NetCoalition, 615 F.3d at 535.
---------------------------------------------------------------------------

    As explained below in the Exchange's Statement on Burden on
Competition, the Exchange believes that there is substantial evidence
of competition in the marketplace for data and that the Commission can
rely upon such evidence in concluding that the fees proposed in this
filing are the product of competition and therefore satisfy the
relevant statutory standards.\10\ In addition, the existence of
alternatives to these data products, such as options data from other
sources, as described below, further ensures that the Exchange cannot
set unreasonable fees, or fees that are unreasonably discriminatory,
when vendors and subscribers can elect such alternatives.
---------------------------------------------------------------------------

    \10\ Section 916 of the Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010 (the ``Dodd-Frank Act'') amended
paragraph (A) of Section 19(b)(3) of the Act, 15 U.S.C. 78s(b)(3),
to make clear that all exchange fees for market data may be filed by
exchanges on an immediately effective basis.
---------------------------------------------------------------------------

    As the NetCoalition decision noted, the Commission is not required
to undertake a cost-of-service or ratemaking approach.\11\ The Exchange
believes that, even if it were possible as a matter of economic theory,
cost-based pricing for non-core market data would be so complicated
that it could not be done practically.\12\
---------------------------------------------------------------------------

    \11\ NetCoalition, 615 F.3d at 536.
    \12\ The Exchange believes that cost-based pricing would be
impractical because it would create enormous administrative burdens
for all parties, including the Commission, to cost-regulate a large
number of participants and standardize and analyze extraordinary
amounts of information, accounts, and reports. In addition, and as
described below, it is impossible to regulate market data prices in
isolation from prices charged by markets for other services that are
joint products. Cost-based rate regulation would also lead to
litigation and may distort incentives, including those to minimize
costs and to innovate, leading to further waste. Under cost-based
pricing, the Commission would be burdened with determining a fair
rate of return, and the industry could experience frequent rate
increases based on escalating expense levels. Even in industries
historically subject to utility regulation, cost-based ratemaking
has been discredited. As such, the Exchange believes that cost-based
ratemaking would be inappropriate for proprietary market data and
inconsistent with Congress's direction that the Commission use its
authority to foster the development of the national market system,
and that market forces will continue to provide appropriate pricing
discipline. See Appendix C to NYSE's comments to the Commission's
2000 Concept Release on the Regulation of Market Information Fees
and Revenues, which can be found on the Commission's Web site at
http://www.sec.gov/rules/concept/s72899/buck1.htm.
---------------------------------------------------------------------------

    For these reasons, the Exchange believes that the proposed fees are
reasonable, equitable, and not unfairly discriminatory.

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

    In accordance with Section 6(b)(8) of the Act,\13\ 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. An exchange's ability to price its proprietary
data products is constrained by actual competition for the sale of
proprietary data products, the joint product nature of exchange
platforms, and the existence of alternatives to the Exchange's
proprietary data.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    The Existence of Actual Competition. The market for proprietary
options data products is currently competitive and inherently
contestable because there is fierce competition for the inputs
necessary for the creation of proprietary data and strict pricing
discipline to the proprietary products themselves. Numerous exchanges
compete with each other for options trades and sales of options market
data itself, providing virtually limitless opportunities for
entrepreneurs who wish to compete in any or all of those areas,
including producing and distributing their own options market data.
Proprietary options data products are produced and distributed by each
individual exchange, as well as other entities, in a vigorously
competitive market.
    Competitive markets for order flow, executions, and transaction
reports provide pricing discipline for the inputs of proprietary
options data products and therefore constrain markets from overpricing
proprietary market data. The U.S. Department of Justice has
acknowledged the aggressive competition among exchanges, including for
the sale of proprietary market data itself. In 2011, Assistant Attorney
General Christine Varney stated that exchanges ``compete head to head
to offer real-time equity data products. These data products include
the best bid and offer of every exchange and information on each equity
trade, including the last sale.'' \14\ Similarly, the options markets
vigorously compete with respect to options data products.\15\ It is
common for broker-dealers to further exploit this recognized
competitive constraint by sending their order flow and transaction
reports to multiple markets, rather than providing them all to a single
market.
---------------------------------------------------------------------------

    \14\ Press Release, U.S. Department of Justice, Assistant
Attorney General Christine Varney Holds Conference Call Regarding
NASDAQ OMX Group Inc. and IntercontinentalExchange Inc. Abandoning
Their Bid for NYSE Euronext (May 16, 2011), available at http://www.justice.gov/iso/opa/atr/speeches/2011/at-speech-110516.html.
    \15\ See, e.g., Securities Exchange Act Release No. 67466 (July
19, 2012), 77 FR 43629 (July 25, 2012) (SR-Phlx-2012-93), which
describes a variety of options market data products and their
pricing.
---------------------------------------------------------------------------

    In addition, in the case of products that are distributed through
market data vendors, the market data vendors themselves provide
additional price discipline for proprietary data products because they
control the primary means of access to certain end users. These vendors
impose price discipline based upon their business models. For

example, vendors that assess a surcharge on data they sell are able to
refuse to offer proprietary products that their end users do not or
will not purchase in sufficient numbers. Vendors will not elect to make
available the Amex Options Products unless their customers request it,
and data recipients with Professional Users will not elect to purchase
them unless they can be used for profit-generating purposes. All of
these operate as constraints on pricing proprietary data products.
    Joint Product Nature of Exchange Platform. Transaction execution
and proprietary data products are complementary in that market data is
both an input and a byproduct of the execution service. In fact, market
data and trade execution are a paradigmatic example of joint products
with joint costs. The decision whether and on which platform to post an
order will depend on the attributes of the platforms where the order
can be posted, including the execution fees, data quality, and price
and distribution of their data products. The more trade executions a
platform does, the more valuable its market data products become.
Further, data products are valuable to many end-users only insofar as
they provide information that end-users expect will assist them in
making trading decisions. In that respect, the Exchange believes that
the Amex Options Products offer options market data information that is
useful for professionals in making trading decisions.
    The costs of producing market data include not only the costs of
the data distribution infrastructure, but also the costs of designing,
maintaining, and operating the exchange's transaction execution
platform and the cost of regulating the exchange to ensure its fair
operation and maintain investor confidence. The total return that a
trading platform earns reflects the revenues it receives from both
products and the joint costs it incurs. Moreover, an exchange's broker-
dealer customers view the costs of transaction executions and market
data as a unified cost of doing business with the exchange.
    Other market participants have noted that the liquidity provided by
the order book, trade execution, core market data, and non-core market
data are joint products of a joint platform and have common costs.\16\
The Exchange also notes that the economics literature confirms that
there is no way to allocate common costs between joint products that
would shed any light on competitive or efficient pricing.\17\
---------------------------------------------------------------------------

    \16\ See Securities Exchange Act Release No. 62887 (Sept. 10,
2010), 75 FR 57092, 57095 (Sept. 17, 2010) (SR-Phlx-2010-121);
Securities Exchange Act Release No. 62907 (Sept. 14, 2010), 75 FR
57314, 57317 (Sept. 20, 2010) (SR-NASDAQ-2010-110); and Securities
Exchange Act Release No. 62908 (Sept. 14, 2010), 75 FR 57321, 57324
(Sept. 20, 2010) (SR-NASDAQ-2010-111) (``all of the exchange's costs
are incurred for the unified purposes of attracting order flow,
executing and/or routing orders, and generating and selling data
about market activity. The total return that an exchange earns
reflects the revenues it receives from the joint products and the
total costs of the joint products.''); see also Securities Exchange
Act Release Nos. 71217 (Dec. 31, 2013), 79 FR 875, 877 (Jan. 7,
2014) (SR-NASDAQ-2013-162) and 70945 (Nov. 26, 2013), 78 FR 72740,
72741 (Dec. 3, 2013) (SR-NASDAQ-2013-142) (``Transaction execution
and proprietary data products are complementary in that market data
is both an input and a byproduct of the execution service. In fact,
market data and trade execution are a paradigmatic example of joint
products with joint costs.'').
    \17\ See generally Mark Hirschey, Fundamentals of Managerial
Economics, at 600 (2009) (``It is important to note, however, that
although it is possible to determine the separate marginal costs of
goods produced in variable proportions, it is impossible to
determine their individual average costs. This is because common
costs are expenses necessary for manufacture of a joint product.
Common costs of production--raw material and equipment costs,
management expenses, and other overhead--cannot be allocated to each
individual by-product on any economically sound basis. . . . Any
allocation of common costs is wrong and arbitrary.''). This is not
new economic theory. See, e.g., F. W. Taussig, ``A Contribution to
the Theory of Railway Rates,'' Quarterly Journal of Economics V(4)
438, 465 (July 1891) (``Yet, surely, the division is purely
arbitrary. These items of cost, in fact, are jointly incurred for
both sorts of traffic; and I cannot share the hope entertained by
the statistician of the Commission, Professor Henry C. Adams, that
we shall ever reach a mode of apportionment that will lead to
trustworthy results.'').
---------------------------------------------------------------------------

    Analyzing the cost of market data product production and
distribution in isolation from the cost of all of the inputs supporting
the creation of market data and market data products will inevitably
underestimate the cost of the data and data products. Thus, because it
is impossible to obtain the data inputs to create market data products
without a fast, technologically robust, and well-regulated execution
system, system costs and regulatory costs affect the price of both
obtaining the market data itself and creating and distributing market
data products. It would be equally misleading, however, to attribute
all of an exchange's costs to the market data portion of an exchange's
joint products. Rather, all of an exchange's costs are incurred for the
unified purposes of attracting order flow, executing and/or routing
orders, and generating and selling data about market activity. The
total return that an exchange earns reflects the revenues it receives
from the joint products and the total costs of the joint products.
    The level of competition and contestability in the market is
evident in the numerous alternative venues that compete for order flow,
including 12 self-regulatory organization (``SRO'') options markets,
two of which were approved in the last two years.\18\ The Exchange
believes that these new entrants demonstrate that competition is
robust.
---------------------------------------------------------------------------

    \18\ See Securities Exchange Act Release Nos. 70050 (July 26,
2013), 78 FR 46622 (August 1, 2013) (File No. 10-209) and 68341
(December 3, 2012), 77 FR 73065 (December 7, 2012) (File No. 10-
207).
---------------------------------------------------------------------------

    Each SRO market competes to produce transaction reports via trade
executions. Competition among trading platforms can be expected to
constrain the aggregate return that each platform earns from the sale
of its joint products, but different platforms may choose from a range
of possible, and equally reasonable, pricing strategies as the means of
recovering total costs. For example, some platforms may choose to pay
rebates to attract orders, charge relatively low prices for market data
products (or provide market data products free of charge), and charge
relatively high prices for accessing posted liquidity. Other platforms
may choose a strategy of paying lower rebates (or no rebates) to
attract orders, setting relatively high prices for market data
products, and setting relatively low prices for accessing posted
liquidity. In this environment, there is no economic basis for
regulating maximum prices for one of the joint products in an industry
in which suppliers face competitive constraints with regard to the
joint offering.
    Existence of Alternatives. The large number of SROs that currently
produce proprietary data or are currently capable of producing it
provides further pricing discipline for proprietary data products. Each
SRO is currently permitted to produce proprietary data products, and
many currently do or have announced plans to do so, including but not
limited to the Exchange; NYSE Arca, Inc.; Chicago Board Options
Exchange, Incorporated; C2 Options Exchange, Incorporated;
International Securities Exchange, LLC; NASDAQ; Phlx; BX; BATS
Exchange, Inc. (``BATS''); and Miami International Securities Exchange
LLC. Because market data users can thus find suitable substitutes for
most proprietary market data products,\19\ a market that overprices its
market data products stands a high risk that users may substitute
another source of market data information for its own.
---------------------------------------------------------------------------

    \19\ See supra note 15.
---------------------------------------------------------------------------

    In addition to the competition and price discipline described
above, the market for proprietary data products is also highly
contestable because market entry is rapid, inexpensive, and

profitable. The history of electronic trading is replete with examples
of entrants that swiftly grew into some of the largest electronic
trading platforms and proprietary data producers: Archipelago,
Bloomberg Tradebook, Island, RediBook, Attain, TrackECN, BATS, and
Direct Edge. Two new options exchanges have been approved by the SEC in
the last two years alone.\20\
---------------------------------------------------------------------------

    \20\ See supra note 18.
---------------------------------------------------------------------------

    In establishing the proposed fees, the Exchange considered the
competitiveness of the market for proprietary options data and all of
the implications of that competition. The Exchange believes that it has
considered all relevant factors and has not considered irrelevant
factors in order to establish fair, reasonable, and not unreasonably
discriminatory fees and an equitable allocation of fees among all
users. The existence of numerous alternatives to the Exchange's
products, including proprietary data from other sources, ensures that
the Exchange cannot set unreasonable fees, or fees that are
unreasonably discriminatory, when vendors and subscribers can elect
these alternatives or choose not to purchase a specific proprietary
data product if its cost to purchase is not justified by the returns
any particular vendor or subscriber would achieve through the purchase.

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

    No written comments were solicited or received with respect to the
proposed rule change.

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

    The foregoing rule change is effective upon filing pursuant to
Section 19(b)(3)(A) \21\ of the Act and subparagraph (f)(2) of Rule
19b-4 \22\ thereunder, because it establishes a due, fee, or other
charge imposed by the Exchange.
---------------------------------------------------------------------------

    \21\ 15 U.S.C. 78s(b)(3)(A).
    \22\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such 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. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \23\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \23\ 15 U.S.C. 78s(b)(2)(B).
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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-NYSEMKT-2014-30 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-NYSEMKT-2014-30. 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 Section, 100 F Street
NE., Washington, DC 20549-1090. Copies of the filing will also be
available for inspection and copying at the NYSE's principal office and
on its Internet Web site at www.nyse.com. 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-NYSEMKT-2014-30 and should be submitted
on or before May 8, 2014.
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    \24\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\24\
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2014-08687 Filed 4-16-14; 8:45 am]
BILLING CODE 8011-01-P


48177 Federal Register / Vol. 67, No. 141 / Tuesday, July 23, 2002 / Notices Current Information: http:// www. epa. gov/ air/ caaac/ clean     diesel. html. Individuals or organizations wishing to provide comments to the panel should submit them to Ms. Manners at the address above by September 30, 2002. The Clean Diesel Independent Review Panel expects that public statements presented at its meetings will not be repetitive of previously submitted oral or written statements.

Dated: July 18, 2002. Donald E. Zinger, Acting Director, Office of Transportation and Air Quality. [FR Doc. 02Ð 18712 Filed 7Ð 22Ð 02; 8: 45 am]

BILLING CODE 6560– 50– P ENVIRONMENTAL PROTECTION AGENCY [OPPT– 2002– 0042; FRL– 6819– 1]

Final National Action Plan for Alkyllead Notice of Availability AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.

SUMMARY: On August 25, 2000, EPA issued a proposed National Action Plan on alkyl lead for public review and comment. This Plan is intended to promote further voluntary reductions of use and exposure to alkyl lead compounds. Alkyl lead is used as a fuel additive to reduce `` knock'' in certain combustion engines. These compounds also help lubricate internal engine components and protect intake and exhaust valves against recession. Currently, the largest uses of alkyl lead compounds are in aviation gasoline for general aviation (piston engine) aircraft, and racing gasoline. Six comments were submitted to the Agency concerning this plan. The Agency has reviewed these comments and has revised the Plan accordingly. This Notice announces the finalization and availability of the Alkyl lead National Action Plan. This plan was developed pursuant to the Agency's Multimedia Strategy for Priority Persistent, Bioaccumulative, and Toxic (PBT) Pollutants.

FOR FURTHER INFORMATION CONTACT: For general information contact: Barbara Cunningham, Director, Office of Program Management and Evaluation, Office of Pollution Prevention and Toxics (7401), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone number: (202) 554Ð 1404; e mail address: TSCA Hotline@ epa. gov. For technical information contact: Paul Matthai, Pollution Prevention Division, Mail Code 7409M, Office of Pollution Prevention and Toxics, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone number: (202) 564Ð 8839; e mail address: matthai. paul@ epa. gov.

SUPPLEMENTARY INFORMATION:

I. General Information A. Does this Action Apply to Me? This action is directed to the public in general. This action may, however, be of interest to persons who make, distribute, or use racing and aviation gasoline. Since other entities may also be interested, the Agency has not attempted to describe all the specific entities that may be affected by this action. If you have any questions regarding the applicability of this action to a particular entity, consult the technical person listed under FOR FURTHER INFORMATION CONTACT.

B. How Can I Get Additional Information, Including Copies of this Document or Other Related Documents? 1. Electronically. You may obtain electronic copies of this document, and certain other related documents that might be available electronically, from the EPA Internet Home Page at http:// www. epa. gov/ pbt. To access this document, on the PBT Home Page select `` Strategy and Action Plans. '' 2. In person. The Agency has established an official record for this action under docket control number OPPTÐ 2002Ð 0042. The official record consists of the documents specifically referenced in this action, any public comments received during an applicable comment period, and other information related to this action, including any information claimed as confidential business information (CBI). This official record includes the documents that are physically located in the docket, as well as the documents that are referenced in those documents. The public version of the official record does not include any information claimed as CBI. The public version of the official record, which includes printed, paper versions of any electronic comments submitted during an applicable comment period, is available for inspection in the TSCA Nonconfidential Information Center, North East Mall Rm. BÐ 607, Waterside Mall, 1200 Pennsylvania Ave., NW., Washington, DC. The Center is open from noon to 4 p. m., Monday through Friday, excluding legal holidays. The telephone number for the Center is (202) 260Ð 7099. II. What Action is the Agency Taking?

On November 16, 1998, EPA released its Agency wide Multimedia Strategy for Priority Persistent, Bioaccumulative, and Toxic (PBT) Pollutants (PBT Strategy). The goal of the PBT Strategy is to identify and reduce risks to human health and the environment from current and future exposure to priority PBT pollutants. This document serves as the Final National Action Plan for alkyl lead, one of the 12 Level 1 priority PBT pollutants identified for the initial focus of action in the PBT Strategy. Alkyl lead compounds are man made compounds in which a carbon atom of one or more organic molecules is bound to a lead atom. Tetraethyllead (TEL) and tetramethyllead (TML) compounds are the most common alkyl lead compounds that have been used in the past and are still in use today in the United States. These two alkyl lead compounds are the focus of this National Action Plan. Alkyl lead is used as a fuel additive to reduce `` knock`` in combustion engines, help lubricate internal engine components and protect intake and exhaust valves against recession. Currently, the largest uses of alkyl lead are in aviation gasoline for general aviation (piston engine) aircraft, and racing gasoline. Neither of these uses are subject to any of the regulations that restrict leaded motor gasoline use. In the human body, alkyl lead compounds are distributed through the blood to `` soft tissues'' particularly the liver, kidneys, muscles, and brain. Initial symptoms of alkyl lead poisoning include, among others: anorexia, insomnia, tremor, weakness, fatigue, nausea and vomiting, mood shifts such as aggression or depression, and impairment of memory. In the case of acute alkyl lead poisoning, possible health effects include mania, convulsions, delirium, fever, coma, and in some cases even death. The ultimate goal of this alkyl lead Plan is to identify and reduce risks to human health and the environment from current and future exposure to alkyl lead. EPA believes that, with the regulatory actions it has taken to date, this goal is within reach. However, the Agency is concerned about any subpopulations that may remain at risk, for example, individuals exposed at racetracks or general aviation airports. The Agency also recognizes that these remaining risks should not be taken lightly. EPA does not have the authority under the Clean Air Act to regulate the use of leaded gasoline for the racing industry, and the authority to regulate aircraft fuel lies with the Federal Aviation Administration. Therefore, the VerDate Jul< 19> 2002 18: 28 Jul 22, 2002 Jkt 197001 PO 00000 Frm 00048 Fmt 4703 Sfmt 4703 E:\ FR\ FM\ 23JYN1. SGM pfrm17 PsN: 23JYN1 48178 Federal Register / Vol. 67, No. 141 / Tuesday, July 23, 2002 / Notices Agency has chosen to address the risks that remain for alkyl lead through voluntary efforts under its PBT pollutants program. It is likely that further reductions in exposures to these chemicals will come only through product substitution and voluntary measures.

List of Subjects Environmental protection, Alkyl lead, PBT.

Dated: June 10, 2002. Stephen L. Johnson, Assistant Administrator for Prevention, Pesticides and Toxic Substances. [FR Doc. 02Ð 18588 Filed 7Ð 22Ð 02 8: 45 am]

BILLING CODE 6560– 50– S FEDERAL DEPOSIT INSURANCE CORPORATION FDIC Statement of Policy on Bank Merger Transactions AGENCY: Federal Deposit Insurance Corporation (FDIC). ACTION: Final agency policy statement (amended).

SUMMARY: The FDIC is amending its Statement of Policy on Bank Merger Transactions to incorporate a recent statutory change to the Bank Merger Act, as amended by the USA PATRIOT Act, which makes an insured depository institution's effectiveness in combating money laundering a factor in evaluating a proposed merger transaction. EFFECTIVE DATE: July 23, 2002. FOR FURTHER INFORMATION CONTACT: Kevin W. Hodson, Review Examiner (202/ 898Ð 6919), Division of Supervision and Consumer Protection; Robert C. Fick, Counsel (202/ 898Ð 8962), or Carl Gold, Counsel (202/ 898Ð 8702), Legal Division, FDIC, 550 17th Street, NW., Washington, DC 20429. SUPPLEMENTARY INFORMATION: Section 327 of the USA PATRIOT Act (Pub. L. 107Ð 56, enacted October 26, 2001) amends section 18( c) of the Federal Deposit Insurance Act 12 U. S. C. 1828( c) (commonly known as the Bank Merger Act), adding a new factor for consideration in deciding merger transactions covered by the Bank Merger Act. The factor reads, `` In every case, the responsible agency shall take into consideration the effectiveness of any insured depository institution involved in the proposed merger transaction in combating money laundering activities, including in overseas branches. '' The amended statement of policy essentially restates the USA PATRIOT Act requirement. No new informational requirements relating to Bank Merger Act applications are imposed at this time. Consideration of the new factor is required on applications submitted after December 31, 2001. The FDIC is not soliciting comment on the revised Statement of Policy. The amendment to the Policy Statement, which was published at 63 FR 44761 on August 20, 1998, is effective immediately upon publication in the Federal Register. The Statement of Policy is hereby amended by adding a new paragraph at the end of section III., to read as follows:

FDIC Statement of Policy on Bank Merger Transactions * * * * *

III. Evaluation of Merger Applications * * * * *

Anti Money Laundering Record In every case, the FDIC will take into consideration the effectiveness of each insured depository institution involved in the proposed merger transaction in combating money laundering activities, including in overseas branches. In this regard, the FDIC will consider the adequacy of each institution's programs, policies, and procedures relating to antimoney laundering activities; the relevant supervisory history of each participating institution, including their compliance with anti money laundering laws and regulations; and the effectiveness of any corrective program outstanding. The FDIC's assessment may also incorporate information made available to the FDIC by the Department of the Treasury, other Federal or State authorities, and/ or foreign governments. Adverse findings may warrant correction of identified problems before consent is granted, or the imposition of conditions. Significantly adverse findings in this area may form the basis for denial of the application.

Federal Deposit Insurance Corporation.

Dated at Washington, DC, this 12th day of July, 2002.

By order of the Board of Directors.

Valerie J. Best,

Assistant Executive Secretary/ Supervisory Counsel. [FR Doc. 02Ð 18493 Filed 7Ð 22Ð 02; 8: 45 am]

BILLING CODE 6714– 01– P FEDERAL EMERGENCY MANAGEMENT AGENCY [FEMA– 1418– DR]

Indiana; Amendment No. 3 to Notice of a Major Disaster Declaration AGENCY: Federal Emergency Management Agency (FEMA). ACTION: Notice.

SUMMARY: This notice amends the notice of a major disaster declaration for the State of Indiana, (FEMAÐ 1418Ð DR), dated June 13, 2002, and related determinations.

EFFECTIVE DATE: July 15, 2002. FOR FURTHER INFORMATION CONTACT: Rich Robuck, Readiness, Response and Recovery and Directorate, Federal Emergency Management Agency, Washington, DC 20472, (202) 646Ð 2705 or Rich. Robuck@ fema. gov. SUPPLEMENTARY INFORMATION: The notice of a major disaster declaration for the State of Indiana is hereby amended to include the following areas among those areas determined to have been adversely affected by the catastrophe declared a major disaster by the President in his declaration of June 13, 2002:

Dearborn and Orange Counties for Individual Assistance (already designated for Public Assistance).

(The following Catalog of Federal Domestic Assistance Numbers (CFDA) are to be used for reporting and drawing funds: 83.537, Community Disaster Loans; 83.538, Cora Brown Fund Program; 83.539, Crisis Counseling; 83.540, Disaster Legal Services Program; 83.541, Disaster Unemployment Assistance (DUA); 83.542, Fire Suppression Assistance; 83.543, Individual and Family Grant (IFG) Program; 83.544, Public Assistance Grants; 83.545, Disaster Housing Program; 83.548, Hazard Mitigation Grant Program) Joe M. Allbaugh, Director. [FR Doc. 02Ð 18531 Filed 7Ð 22Ð 02; 8: 45 am]

BILLING CODE 6718– 02– P FEDERAL EMERGENCY MANAGEMENT AGENCY [FEMA– 1419– DR]

Minnesota; Amendment No. 6 to Notice of a Major Disaster Declaration AGENCY: Federal Emergency Management Agency (FEMA). ACTION: Notice.

SUMMARY: This notice amends the notice of a major disaster declaration for the State of Minnesota, (FEMAÐ 1419Ð DR), dated June 14, 2002, and related determinations.

VerDate Jul< 19> 2002 18: 28 Jul 22, 2002 Jkt 197001 PO 00000 Frm 00049 Fmt 4703 Sfmt 4703 E:\ FR\ FM\ 23JYN1. SGM pfrm17 PsN: 23JYN1