[Federal Register Volume 84, Number 98 (Tuesday, May 21, 2019)]
[Notices]
[Pages 23090-23095]
[FR Doc No: 2019-10522]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85863; File No. SR-OCC-2019-802]

Self-Regulatory Organizations; The Options Clearing Corporation;
Notice of Filing of Advance Notice Related to the Introduction of a New
Liquidation Cost Model in The Options Clearing Corporation's Margin
Methodology

May 15, 2019.
    Pursuant to Section 806(e)(1) of Title VIII of the Dodd-Frank Wall
Street Reform and Consumer Protection Act, entitled Payment, Clearing
and Settlement Supervision Act of 2010 (``Clearing Supervision Act'')
\1\ and Rule 19b-4(n)(1)(i) \2\ under the Securities Exchange Act of
1934 (``Exchange Act''),\3\ notice is hereby given that on April 18,
2019, the Options Clearing Corporation (``OCC'') filed with the
Securities and Exchange Commission (``Commission'') an advance notice
(``Advance Notice'') as described in Items I, II and III below, which
Items have been prepared by OCC. The Commission is publishing this
notice to solicit comments on the advance notice from interested
persons.
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    \1\ 12 U.S.C. 5465(e)(1).
    \2\ 17 CFR 240.19b-4(n)(1)(i).
    \3\ 15 U.S.C. 78a et seq.
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I. Clearing Agency's Statement of the Terms of Substance of the Advance
Notice

    This advance notice is submitted in connection with proposed
changes to OCC's Margins Methodology, Margin Policy, and Stress Testing
and Clearing Fund Methodology Description to add a risk-based
liquidation charge based on bid-ask spreads to adjust the value of
positions to account for the costs of liquidating a defaulting Clearing
Member's portfolio. The proposed changes to OCC's Margins Methodology,
Margin Policy, and Stress Testing and Clearing Fund Methodology
Description are contained in confidential Exhibits 5A-5C of the filing.
Material proposed to be added is marked by underlining and material
proposed to be deleted is marked by strikethrough text. OCC also has
included a summary of impact analysis of the proposed model changes in
confidential Exhibit 3. The proposed changes are described in detail in
Item II below.
    The advance notice is available on OCC's website at https://www.theocc.com/about/publications/bylaws.jsp. All terms with initial
capitalization that are not otherwise defined herein have the same
meaning as set forth in the OCC By-Laws and Rules.\4\
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    \4\ OCC's By-Laws and Rules can be found on OCC's public
website: http://optionsclearing.com/about/publications/bylaws.jsp.
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II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Advance Notice

    In its filing with the Commission, OCC included statements
concerning the purpose of and basis for the advance notice and
discussed any comments it received on the advance notice. The text of
these statements may be examined at the places specified in Item IV
below.

OCC has prepared summaries, set forth in sections A and B below, of the
most significant aspects of these statements.

(A) Clearing Agency's Statement on Comments on the Advance Notice
Received From Members, Participants or Others

    Written comments were not and are not intended to be solicited with
respect to the advance notice and none have been received. OCC will
notify the Commission of any written comments received by OCC.

(B) Advance Notices Filed Pursuant to Section 806(e) of the Payment,
Clearing, and Settlement Supervision Act

Description of the Proposed Change
Background
    OCC's margin methodology, the System for Theoretical Analysis and
Numerical Simulations (``STANS''), is OCC's proprietary risk management
system that calculates Clearing Member margin requirements.\5\ STANS
utilizes large-scale Monte Carlo simulations to forecast price and
volatility movements in determining a Clearing Member's margin
requirement.\6\ The STANS margin requirement is calculated at the
portfolio level of Clearing Member legal entity marginable net
positions tier account (tiers can be customer, firm, or market marker)
and consists of an estimate of a 99% 2-day expected shortfall (``99%
Expected Shortfall'') and an add-on for model risk (the concentration/
dependence stress test charge). The STANS methodology is used to
measure the exposure of portfolios of options and futures cleared by
OCC and cash instruments in margin collateral.
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    \5\ See Securities Exchange Act Release No. 53322 (February 15,
2006), 71 FR 9403 (February 23, 2006) (SR-OCC-2004-20). A detailed
description of the STANS methodology is available at http://optionsclearing.com/risk-management/margins/.
    \6\ See OCC Rule 601.
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    STANS margin requirements are comprised of the sum of several
components, each reflecting a different aspect of risk. The base
component of the STANS margin requirement for each account is obtained
using a risk measure known as 99% Expected Shortfall. Under the 99%
Expected Shortfall calculation, an account has a base margin excess
(deficit) if its positions in cleared products, plus all existing
collateral--whether of types included in the Monte Carlo simulation or
of types subjected to traditional ``haircuts''--would have a positive
(negative) net worth after incurring a loss equal to the average of all
losses beyond the 99% value at risk (or ``VaR'') point. This base
component is then adjusted by the addition of a stress test component,
which is obtained from consideration of the increases in 99% Expected
Shortfall that would arise from market movements that are especially
large and/or in which various kinds of risk factors exhibit perfect or
zero correlations in place of their correlations estimated from
historical data, or from extreme adverse idiosyncratic movements in
individual risk factors to which the account is particularly
exposed.\7\ STANS margin requirements are intended to cover potential
losses due to price movements over a two-day risk horizon; however, the
base and stress margin components do not cover the potential
liquidation costs OCC may incur in closing out a defaulted Clearing
Member's portfolio.\8\ Closing out positions in a defaulted Clearing
Member's portfolio could entail selling longs at bid price and covering
shorts at ask price. This means that additional liquidation costs may
need to take into account the bid-ask price spreads.
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    \7\ STANS margins may also include other add on charges, which
are considerably smaller than the base and stress test components,
and many of which affect only a minority of accounts.
    \8\ A liquidation cost model was introduced into STANS in 2012
as part of OCC's OTC clearing initiatives. The model is only applied
to long-dated options on the Standard & Poor's (``S&P'') 500 index
(``SPX'') that have a tenor of three-years or greater. See
Securities Exchange Act Release No. 34-70719 (October 18, 2013), 78
FR 63548 (October 24, 2013) (SR-OCC-2013-16). The existing
liquidation model for long-dated SPX options would be replaced by
this new model. OCC currently does not have any open interest in OTC
options. OCC does currently clear similar exchange traded long-dated
FLEX SPX options; however, these options make up less than 0.5% of
SPX options open interest.
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Proposed Changes
    OCC is proposing to enhance its margin methodology by introducing a
new model to estimate the liquidation cost for all options and futures,
as well as the securities in margin collateral. As noted above, closing
out positions of a defaulted Clearing Member in the open market could
entail selling longs at bid price and covering shorts at ask price.
These closing-out costs are currently not taken into account in STANS
for all options (with the exception of long-dated SPX index option
series, as noted above).\9\ Therefore, the purpose of the proposed
change is to add additional financial resources in the form of margin,
based on liquidation cost grids calibrated using historical stressed
periods, to guard against potential shortfalls in margin requirements
that may arise due to the costs of liquidating Clearing Member
portfolios in the event of a default. The liquidation cost charge would
be applied as an add-on to all accounts incurring a STANS margin
charge.
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    \9\ Id.
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    The proposed liquidation cost model calculates liquidation cost
based on risk measures, gross contract volumes and market bid-ask
spreads. In general, the proposed model would be used to calculate two
risk-based liquidation costs for a portfolio, Vega \10\ liquidation
cost (``Vega LC'') and Delta liquidation cost (``Delta LC''), using
``Liquidation Grids.'' \11\ Options products will incur both Vega and
Delta LCs while Delta-one \12\ products such as futures contracts,
Treasury securities and equity securities, will have only a Delta
charge.
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    \10\ The Delta and Vega of an option represent the sensitivity
of the option price with respect to the price and volatility of the
underlying security, respectively.
    \11\ ``Liquidation Grids'' would be comprised collectively of
Vega Liquidation Grids, Vega Notional Grids, Delta Liquidation
Grids, and Delta Notional Grids. Liquidation Grids are discussed in
more detail below in the Creation and Calibration of Liquidation
Grids section.
    \12\ ``Delta one products'' refer to products for which a change
in the value of the underlying asset results in a change of the
same, or nearly the same, proportion in the value of the product.
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    The proposed liquidation cost model described herein would include:
(1) The decomposition of the defaulter's portfolio into sub-portfolios
by underlying security; (2) the creation and calibration of Liquidation
Grids used to determine liquidation costs; (3) the calculation of the
Vega LC (including a minimum Vega LC charge) for options products; (4)
the calculation of Delta LCs for both options and Delta-one products;
(5) the calculation of Vega and Delta concentration factors; (6) the
calculation of volatility correlations for Vega LCs; (7) the
establishment of a STANS margin floor based on the liquidation cost;
and (8) conforming changes to OCC's Margin Policy and Stress Testing
and Clearing Fund Methodology Description.
    The new liquidation cost model would cover the following cleared
products in a Clearing Member's portfolio: Options on indices,
equities, Exchange Traded Funds (``ETFs'') and futures; FLEX options;
future contracts; Treasury securities; and stock loan and collateral
securities. The securities not included in STANS margin calculations
would not be covered by the new model.
    The proposed approach to calculating liquidation costs and the
conforming changes to OCC's Margin Policy are described in further
detail below.

1. Portfolio Decomposition and Creation of Sub-Portfolios
    For a portfolio consisting of many contracts and underlyings, the
proposed model would first divide (or decompose) the portfolio into
sub-portfolios by underlying security such that all contracts with the
same underlying are grouped into the same sub-portfolio. The Vega LC
and Delta LC are first calculated at a sub-portfolio level and then
aggregated to derive the final liquidation cost for the total
portfolio. All the option positions with the same fundamental
underlying would form one sub-portfolio because they share the same
risk characteristics. The equity index, index future and index ETFs
would all be categorized by the underlying index that is the basis for
the index, future, and ETF-underlying securities. The corresponding
options on the index, index future, and ETFs would therefore fall into
the same sub-portfolio. In addition, FLEX options on the same
underlying would be included in the same sub-portfolio of the regular
options. Similarly, cash products such as equities and futures would be
grouped in the same sub-category based on their underlying symbols. All
Treasury security positions would form one sub-portfolio. The
calculation of Vega LC and Delta LC for each sub-portfolio is
summarized in the next sections.
2. Creation and Calibration of Liquidation Grids
    A key element of the proposed liquidation cost model is the
``Liquidation Grids.'' The calculations of Vega LC and Delta LC involve
a number of liquidity-related quantities such as volatility bid-ask
spreads, price bid-ask spreads, Vega notional, and Delta notional. The
collection of these quantities would be used to create the following
Liquidation Grids.
    1. Vega Liquidation Grids (or volatility grids): The Vega
Liquidation Grids would represent the level of bid-ask spreads on the
implied volatility of option contracts for a given underlying. Since
the volatility spreads of option contracts vary by the Delta and tenor
of the option, OCC would divide the contracts into several Delta
buckets by tenor buckets.\13\ Each pair (Delta, tenor) is referred to
as a Vega bucket. For each bucket, an average volatility spread is
estimated and defined as the volatility grid for the bucket. The size
of grid would essentially represent the cost for liquidating one unit
of Vega risk in the bucket.
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    \13\ Initially, Vega Liquidation Grids would consist of 5 Delta
buckets by 5 tenor buckets, with a total of 25 pairs; however, the
Vega Liquidation Grids would be reviewed annually or at a frequency
determined by OCC's Model Risk Working Group (``MRWG'') and updated
as needed as determined by the MRWG. The MRWG is responsible for
assisting OCC's Management Committee in overseeing and governing
OCC's model-related risk issues and includes representatives from
OCC's Financial Risk Management department, Quantitative Risk
Management department, Model Validation Group, and Enterprise Risk
Management department.
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    2. Vega Notional Grid: The Vega Notional Grid of an underlying
security would be the average trading options volume weighted by the
Vega of all options on the given underlying. The size of Vega Notional
grids would indicate the average daily trading volume in terms of
dollar Vegas (i.e., the Vega multiplied by the volume of the option).
    3. Delta Liquidation Grid: The Delta liquidation grid would
represent an estimated bid-ask price spread (in percentage) on the
underlying.\14\ It represents the cost of liquidating one dollar unit
of the underlying security. The Delta liquidation grid for Treasury
securities represents bid-ask yield spreads, expressed in basis points.
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    \14\ Delta Liquidation Grids are comprised of several rows
representing liquidity categories for the underlying security
(initially 14 rows, subject to periodic review and modification) and
one column representing the cost of liquidating one dollar unit of
the underlying security. The Delta Liquidation Grids would be
reviewed annually or at a frequency determined by OCC's MRWG and
updated as needed as determined by the MRWG.
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    4. Delta Notional Grid: The Delta Notional grid of an underlying
security would represent the average trading volume in dollars of the
security.\15\
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    \15\ Delta Notional Grids are comprised of several rows
representing liquidity categories for the underlying security
(initially 14 rows, subject to periodic review and modification) and
one column representing the average trading volume in dollars of the
underlying security. The Delta Notional Grids would be reviewed
annually or at a frequency determined by OCC's MRWG and updated as
needed as determined by the MRWG.
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    Vega Notional Grids are calibrated at the security level; that is,
each individual underlying security would have its own Vega Notional.
The Delta Notional Grid and both Vega and Delta Liquidation Grids for
all underlying securities are estimated at the levels of a fixed number
of classes based on their liquidity level.\16\ All equity securities
would be divided, based on their membership in commonly used market
indices (including, but not limited to, the S&P 100 and 500 index) or
other market liquidity measurements, into liquidity classes (which may
include, but are not limited to, High Liquid Equities, Medium Liquid
Equities and Low Liquid Equities). Any new equity security would
generally default to the lowest liquidity classification unless
otherwise assigned to a higher liquidity classification when deemed
necessary. Major indices (e.g., SPX or the Cboe Volatility Index
(``VIX'')) may form their own index liquidity class, which may cover
indices, index ETFs, and index futures. In addition, sector ETFs, ETFs
on a major commodity (such as Gold, Crude/Natural Gas, Metals, and
Electricity), and Treasury ETFs would generally each form individual
classes of their own, subject to the availability of liquidation data.
Pursuant to the proposed Margins Methodology, these liquidity classes
would be reviewed annually or at a frequency determined by OCC's MRWG
and updated as needed, taking into consideration such factors
including, but not limited to, changes in membership of the S&P 100
index and S&P 500 index, listing and delisting of securities, and any
corporate actions on the existing securities.
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    \16\ Within the same liquidity group, the Vega Notional can vary
dramatically from name to name. Moreover, Vega risk can be much
greater than Delta risk. As a result, OCC would calculate Vega
Notionals at the security level as opposed to the liquidity level.
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    Because the bid-ask spreads can change daily, the use of spreads
from current market conditions could cause liquidation costs to
fluctuate dramatically with market volatility, especially during a
stressed market period. To mitigate this procyclicality issue,
Liquidation Grids would be calibrated from several historical stressed
periods, which are selected based on the history of VIX index levels
and would remain unchanged with time until a new stressed period is
selected and added to the calibrations in accordance with the
requirements of the proposed Margins Methodology.\17\
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    \17\ The Liquidation Grids will be reviewed annually or at a
frequency determined by the MRWG.
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3. Vega Liquidation Cost
Vega Liquidation Cost Calculation
    Vega LC is the main component of the proposed liquidation cost
model. For a simple option contract, the Vega LC would be its position
Vega multiplied by its respective bucket in the Vega Liquidation Grid.
The result is approximately equal to one half of the bid-ask price
spread. For a portfolio consisting of many contracts and underlyings,
the model first divides the portfolio into sub-portfolios by underlying
security such that all contracts with the same underlying are grouped
into the same sub-portfolio (as described above). The Vega LCs for sub-
portfolios are calculated first and then aggregated to derive the Vega
LC for the total portfolio.

    The Vega LC for a sub-portfolio, which consists of all the
contracts with the same underlying security, would be calculated in
several steps. First, the Liquidation Grids would be calibrated for
Vega ``buckets'' that consist of Delta bins by tenor bins as discussed
above. These Vega buckets are used to represent the volatility risk at
the different areas on the implied volatility surface. Next, the Vega
of each contract position in a given sub-portfolio would be calculated
and bucketed into one of the Vega buckets. The Vegas falling into the
same Vega bucket would then be netted. The Vega LC for each of the Vega
buckets is calculated as the net Vega multiplied by the Vega grid of
the buckets. Finally, the total liquidation cost for the sub-portfolio
would be aggregated from these bucket Vega LCs by using correlations
between the Vega buckets. Since the sub-portfolios are formed by the
fundamental equity or index underlying the option, the Vega LCs of
closely related but different underlying securities are allowed to net.
For example, Vega LCs for SPX and related indices, futures, and ETFs
that are based on the S&P 500 index would be allowed 100% netting.
    The Vega LC for the total portfolio would be a similar correlation-
based sum of Vega LCs of all the sub-portfolios, taking into account
correlations between the products' implied volatility.\18\
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    \18\ See infra, Volatility Correlations section.
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Minimum Liquidation Cost
    Because the proposed model allows risk netting across closely
related option contracts, it is possible that a well-hedged option
strategy could result in a very small or zero liquidation cost. To
prevent this from happening, a minimum liquidation cost would be
introduced to the Vega liquidation charges. The minimum liquidation
cost for a sub-portfolio would be calculated as the gross number of
option contracts multiplied by a minimum cost per contract value.\19\
The minimum cost amount would be calculated for the entire portfolio
and would be used to floor the final total Vega LC. The proposal would
not apply a minimum cost for Delta LC due to the immaterial impact a
minimum Delta LC would have on the overall liquidation cost charge.
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    \19\ The minimum cost rate would initially be set as $2 per
contract, unless the position is long and the net asset value per
contract is less than $2. (For a typical option with a contract size
of 100, this would occur if the option was priced below 0.02.) This
value would be reviewed annually or at a frequency determined by
OCC's MRWG and recalibrated as needed over time.
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4. Delta Liquidation Cost
    In addition to Vega risk, the model also considers the Delta risk
presented in an entire portfolio. If a portfolio has positions in
either options, futures, equities, or Treasury securities, it will
contain some Delta risk. Under the proposed model, the liquidation cost
due to Delta risk in a sub-portfolio (as defined by the underlying)
would be approximated by the net dollar Delta of the sub-portfolio
multiplied by its respective bucket in the Delta Liquidation Grid.
    The proposed model would allow netting of Delta LC if the option
contracts, futures, or equity positions belong to or are related to a
top index (such as SPX or VIX). For example, in a portfolio, positions
in SPX-related options, options on futures, futures, or collateral have
their Delta LC netted.
    Under the proposed model, U.S. dollar Treasury bonds would form one
sub-portfolio. The Delta or DV01 (i.e., dollar value of one basis
point) of all the bonds would be calculated and bucketed into six tenor
buckets. For each bucket, the liquidation cost would be approximated by
the absolute value of the net DV01 of the bucket multiplied by the
Liquidation Grid (in basis points) in the corresponding tenor bucket.
The total liquidation cost for the Treasury security sub-portfolio
would then be a sum of the costs over all the buckets.
    The Delta LC for the total portfolio would be simple sum of the
Delta LCs over all sub-portfolios.
5. Concentration Charges
    In addition to Vega and Delta LCs, the proposed model also would
incorporate the potential risks involved in closing out large or
concentrated positions in a portfolio. The ``largeness'' of an option
position is typically measured in terms of Average Daily Volume
(``ADV''). The Vega volume or notional, defined as ``Vega-weighted
ADV,'' is also a relevant measure of options trading volume. Closing
out large or concentrated positions with one or more Vega notional may
either take longer to liquidate or demand wider spreads, and therefore
could incur additional cost. To cover this additional risk, the
proposed model would use Vega concentration factors (``Vega CF'') to
scale the Vega LC for option positions. The Vega CFs would be equal to
one for small positions that are less than one Vega notional, but may
be scaled up for large positions as a function of the size of the
positions. Similar to Vega CF, Delta concentration factors (``Delta
CF'') would be used to scale the Delta LC to account for the
concentration risk associated with large Delta positions.
6. Volatility Correlations
    Under the proposed model, the Vega LC for each underlying sub-
portfolio is calculated using correlations between the Vega buckets.
The correlation matrix from the most liquid product (SPX) would be used
as the base and would be scaled for other underlyings based on their
liquidity class. These would be calibrated from time periods that
overlap the stress periods used to calculate Liquidation Grids.
    To aggregate the liquidation cost at the portfolio level, the pair-
wise correlations of implied volatilities between different underlyings
are needed. OCC would use a single correlation value for all cross-
underlying correlations rather than a correlation matrix for all cross-
underlying correlations to simplify the calibration of the grids. To
account for potential errors that may arise from using a single
correlation value, OCC would calculate three single correlations
representing the minimum, average, and maximum correlation across the
liquidity class to determine three different Vega LCs. The highest of
these three Vega LCs would be used as the final Vega LC.
7. STANS Margin Floor
    The proposed liquidation costs would be added to the base and
stress margin components of STANS that are intended to cover the
potential losses due to price movements over a two-day risk horizon. In
certain cases, well-hedged portfolios may not experience any loss and
the resultant STANS margin requirement is close to zero or may even
become positive in some extreme cases. If the STANS requirement is
positive, this may result in a credit instead of a charge for the
Clearing Member. To account for the risk of potentially liquidating a
portfolio at current (instead of two-day ahead) prices, no credit from
the margin would be allowed so that the final margin requirement would
not be lower than the amount of the liquidation cost.
8. Margin Policy and Stress Testing and Clearing Fund Methodology
Description
    OCC also would make conforming changes to its Margin Policy and
Stress Testing and Clearing Fund Methodology Description to reflect the
inclusion of the new liquidation cost charge as an add-on charge to the
base STANS margin and how the liquidation cost

charge add-on would be incorporated in Clearing Fund shortfall
calculations.\20\
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    \20\ The Stress Testing and Clearing Fund Methodology
Description would be revised to note that the shortfall of a
portfolio is calculated by offsetting its profit and loss (``PnL'')
in a stress scenario with its STANS margin assets, which include
base margin (i.e., 99% Expected Shortfall), excess net asset value
related to long option premium, any non-collateral-in-margins
haircut amounts, and various other Add-On Charges such as the
proposed liquidation cost charges. Since the cost of liquidation is
not considered in stress scenario PnL, a charge for liquidation
costs using the same values as calculated for margins is included in
shortfall calculations to ensure that the liquidation cost charge is
part of the required total credit financial resources.
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Clearing Member Outreach
    To inform Clearing Members of the proposed change, OCC has provided
overviews of its proposed liquidation cost model to the Financial Risk
Advisory Council (``FRAC''), a working group comprised of exchanges,
Clearing Members and indirect participants of OCC, and the OCC
Roundtable, which was established to bring Clearing Members, exchanges
and OCC together to discuss industry and operational issues,\21\ during
2016 and 2017. OCC has also published Information Memos to all Clearing
Members discussing the proposed change.
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    \21\ The OCC Roundtable is comprised of representatives of the
senior OCC staff, participant exchanges and Clearing Members,
representing the diversity of OCC's membership in industry segments,
OCC-cleared volume, business type, operational structure and
geography.
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    Under the proposed liquidation cost model, each Clearing Member/
account would independently observe different levels of impact based on
the composition of their cleared portfolios. Based on OCC's analysis
to-date, directional portfolios containing more outright positions,
which are more typically associated with customer accounts, are most
likely to see the largest impact from the proposed liquidation cost
charges, while more well-hedged portfolios, such as market maker
accounts, would be less impacted (and are more likely to incur the
minimum liquidation cost charge). In the aggregate, OCC expects the
proposed liquidation cost charges to make up approximately 5-8% of
total risk margin charges, with customer accounts accounting for
roughly 60% of the proposed liquidation cost charges, and proprietary
accounts and market markers generating approximately 25% and 15% of the
proposed liquidation cost charges, respectively.
    Given the magnitude of expected changes in margins, OCC expects to
conduct an extended parallel implementation for Clearing Members prior
to implementation. Additionally, OCC will perform additional outreach
to the FRAC upon submission of its regulatory filings to remind
Clearing Members of the pending changes and direct outreach with those
Clearing Members that would be most impacted by the proposed change and
would work closely with such Clearing Members to coordinate the
implementation and associated funding for such Clearing Members
resulting from the proposed change.\22\
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    \22\ Specifically, OCC will discuss with those Clearing Members
how they plan to satisfy any increase in their margin requirements
associated with the proposed change.
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Implementation Timeframe
    OCC expects to implement the proposed changes no sooner than thirty
(30) days and no later than one hundred eighty (180) days from the date
that OCC receives all necessary regulatory approvals for the filings.
OCC will announce the implementation date of the proposed change by an
Information Memo posted to its public website at least two (2) weeks
prior to implementation.
Expected Effect on and Management of Risk
    OCC believes that the proposed change, which would introduce a new
liquidation cost model into OCC's margin methodology, would reduce the
overall level of risk to OCC, its Clearing Members, and the markets
served by OCC. As described above, STANS margin requirements are
comprised of the sum of several components, each reflecting a different
aspect of risk. These margins are intended to cover the potential
losses due to price movements over a two-day risk horizon; however, the
base and stress margin components do not cover the potential
liquidation cost OCC may incur in closing out a defaulted Clearing
Member's portfolio. Closing out positions in a defaulted portfolio
could entail selling longs at bid price and covering shorts at ask
price. This means that additional liquidation costs may need to take
into account the bid-ask price spreads. The proposed liquidation cost
model would calculate liquidation costs for OCC's cleared products
based on risk measures, gross contract volumes and market bid-ask
spreads. The proposed model is designed to provide additional financial
resources in the form of margin, based on liquidation costs and current
market prices, to guard against potential shortfalls in margin
requirements that may arise due to the costs of liquidating Clearing
Member portfolios. OCC uses the margin it collects from a defaulting
Clearing Member to protect other Clearing Members from losses they
cannot anticipate or control as a result of such a default. As a
result, OCC believes the proposed changes would reduce the overall
level of risk to OCC, its Clearing Members, and the markets served by
OCC.
Consistency With the Payment, Clearing and Settlement Supervision Act
    The stated purpose of the Clearing Supervision Act is to mitigate
systemic risk in the financial system and promote financial stability
by, among other things, promoting uniform risk management standards for
systemically important financial market utilities and strengthening the
liquidity of systemically important financial market utilities.\23\
Section 805(a)(2) of the Clearing Supervision Act \24\ also authorizes
the Commission to prescribe risk management standards for the payment,
clearing and settlement activities of designated clearing entities,
like OCC, for which the Commission is the supervisory agency. Section
805(b) of the Clearing Supervision Act \25\ states that the objectives
and principles for risk management standards prescribed under Section
805(a) shall be to:
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    \23\ 12 U.S.C. 5461(b).
    \24\ 12 U.S.C. 5464(a)(2).
    \25\ 12 U.S.C. 5464(b).
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     Promote robust risk management;
     promote safety and soundness;
     reduce systemic risks; and
     support the stability of the broader financial system.
    OCC believes that the proposed changes described herein would
enhance its margin methodology in a manner consistent with the
objectives and principles of Section 805(b) of the Clearing Supervision
Act \26\ and the risk management standards adopted by the Commission in
Rule 17Ad-22 under the Act for the reasons set forth below.\27\
---------------------------------------------------------------------------

    \26\ Id.
    \27\ 17 CFR 240.17Ad-22. See Securities Exchange Act Release
Nos. 68080 (October 22, 2012), 77 FR 66220 (November 2, 2012) (S7-
08-11) (``Clearing Agency Standards''); 78961 (September 28, 2016),
81 FR 70786 (October 13, 2016) (S7-03-14) (``Standards for Covered
Clearing Agencies''). OCC is a ``covered clearing agency'' as
defined in Rule 17Ad-22(a)(5) and therefore must comply with the
requirements of Rule 17Ad-22(e).
---------------------------------------------------------------------------

    OCC believes the proposed changes are consistent with the
objectives and principles of Section 805(b) of the Clearing Supervision
Act.\28\ As described above, STANS margin requirements are comprised of
the sum of several components, each reflecting a different aspect of
risk. These margins are intended to cover the potential

losses due to price movements over a two-day risk horizon; however, the
base and stress margin components do not cover the potential
liquidation cost OCC could incur in closing out a defaulted Clearing
Member's portfolio. Closing out positions in a defaulted portfolio
could entail selling longs at bid price and covering shorts at ask
price. This means that additional liquidation costs may need to take
into account the bid-ask price spreads. The proposed model is designed
to provide additional financial resources in the form of margin to
guard against potential shortfalls in margin requirements that may
arise due to the costs of liquidating Clearing Member portfolios. OCC
uses the margin it collects from a defaulting Clearing Member to
protect other Clearing Members from losses as a result of the default.
As a result, OCC believes the proposed change would promote robust risk
management and safety and soundness while reducing systemic risks and
would thereby support the stability of the broader financial system.
---------------------------------------------------------------------------

    \28\ 12 U.S.C. 5464(b).
---------------------------------------------------------------------------

    Rule 17Ad-22(b)(2) \29\ requires, in part, that a registered
clearing agency that performs central counterparty services establish,
implement, maintain and enforce written policies and procedures
reasonably designed to use margin requirements to limit its credit
exposures to participants under normal market conditions and use risk-
based models and parameters to set margin requirements. As described
above, the proposed liquidation cost model is a risk-based model that
calculates liquidation cost based on risk measures, gross contract
volumes, and market bid-ask spreads. The proposed model is designed to
provide additional financial resources in the form of margin, based on
liquidation costs and current market prices, to guard against potential
shortfalls in margin requirements that may arise due to the costs of
liquidating Clearing Member portfolios, which currently are not taken
into account in STANS for all of OCC's cleared products. Accordingly,
the proposed risk-based model would be used to calculate margin
requirements designed to limit OCC's credit exposures to participants
under normal market conditions in a manner consistent with Rule 17Ad-
22(b)(2).\30\
---------------------------------------------------------------------------

    \29\ 17 CFR 240.17Ad-22(b)(2).
    \30\ Id.
---------------------------------------------------------------------------

    Rule 17Ad-22(e)(6)(i) \31\ further requires a covered clearing
agency that provides central counterparty services to establish,
implement, maintain and enforce written policies and procedures
reasonably designed to cover its credit exposures to its participants
by establishing a risk-based margin system that considers, and produces
margin levels commensurate with, the risks and particular attributes of
each relevant product, portfolio, and market. The proposed liquidation
cost model is a risk-based model that would calculate additional margin
charges designed to account for potential shortfalls in margin
requirements that may arise due to the costs of liquidating Clearing
Member portfolios by taking into consideration the risks and attributes
associated with relevant products and portfolios cleared by OCC (e.g.,
volatility bid-ask spreads, price bid-ask spreads, Vega notional, and
Delta notional). Accordingly, OCC believes the proposed changes are
consistent with Rule 17Ad-22(e)(6)(i).\32\
---------------------------------------------------------------------------

    \31\ 17 CFR 240.17Ad-22(e)(6)(i).
    \32\ Id.
---------------------------------------------------------------------------

III. Date of Effectiveness of the Advance Notice and Timing for
Commission Action

    The proposed change may be implemented if the Commission does not
object to the proposed change within 60 days of the later of (i) the
date the proposed change was filed with the Commission or (ii) the date
any additional information requested by the Commission is received. OCC
shall not implement the proposed change if the Commission has any
objection to the proposed change.
    The Commission may extend the period for review by an additional 60
days if the proposed change raises novel or complex issues, subject to
the Commission providing the clearing agency with prompt written notice
of the extension. A proposed change may be implemented in less than 60
days from the date the advance notice is filed, or the date further
information requested by the Commission is received, if the Commission
notifies the clearing agency in writing that it does not object to the
proposed change and authorizes the clearing agency to implement the
proposed change on an earlier date, subject to any conditions imposed
by the Commission.
    OCC shall post notice on its website of proposed changes that are
implemented. The proposal shall not take effect until all regulatory
actions required with respect to the proposal are completed.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the advance
notice is consistent with the Clearing Supervision 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-OCC-2019-802 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-OCC-2019-802. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the advance notice that are filed with the
Commission, and all written communications relating to the advance
notice between the Commission and any person, other than those that may
be withheld from the public in accordance with the provisions of 5
U.S.C. 552, will be available for website viewing and printing in the
Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the self-regulatory
organization.
    All comments received will be posted without change. Persons
submitting comments are cautioned that we do not redact or edit
personal identifying information from comment submissions. You should
submit only information that you wish to make available publicly.
    All submissions should refer to File Number SR-OCC-2019-802 and
should be submitted on or before June 5, 2019.

    By the Commission.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-10522 Filed 5-20-19; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 80, Number 139 (Tuesday, July 21, 2015)]
[Notices]
[Pages 43140-43141]
[FR Doc No: 2015-17970]

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

SECURITIES AND EXCHANGE COMMISSION

Sunshine Act Meeting

    Notice is hereby given, pursuant to the provisions of the
Government in the Sunshine Act, Public Law 94-409, that the Securities
and Exchange Commission will hold a Closed Meeting on Thursday, July
23, 2015 at 2:00 p.m.
    Commissioners, Counsel to the Commissioners, the Secretary to the
Commission, and recording secretaries will attend the Closed Meeting.
Certain staff members who have an interest in the matters also may be
present.
    The General Counsel of the Commission, or her designee, has
certified that, in her opinion, one or more of the exemptions set forth
in 5 U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) and 17 CFR
200.402(a)(3), (5), (7), 9(ii)

and (10), permit consideration of the scheduled matter at the Closed
Meeting.
    Commissioner Aguilar, as duty officer, voted to consider the items
listed for the Closed Meeting in closed session.
    The subject matter of the Closed Meeting will be:
    Settlement of injunctive actions;
    Institution and settlement of administrative proceedings;
    Resolution of litigation claims;
    Litigation matters; and
    Other matters relating to enforcement proceedings.
    At times, changes in Commission priorities require alterations in
the scheduling of meeting items.
    For further information and to ascertain what, if any, matters have
been added, deleted or postponed, please contact the Office of the
Secretary at<PHONE_NUMBER>.

    Dated: July 16, 2015.
Brent J. Fields,
Secretary.
[FR Doc. 2015-17970 Filed 7-17-15; 4:15 pm]
 BILLING CODE 8011-01-P


[Federal Register Volume 78, Number 190 (Tuesday, October 1, 2013)]
[Notices]
[Pages 60291-60292]
[FR Doc No: 2013-23795]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2011-D-0787]

Investigational Device Exemptions for Early Feasibility Medical
Device Clinical Studies, Including Certain First in Human Studies;
Guidance for Industry and Food and Drug Administration Staff;
Availability

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration (FDA) is announcing the
availability of the guidance entitled ``Investigational Device
Exemptions (IDEs) for Early Feasibility Medical Device Clinical
Studies, Including Certain First in Human (FIH) Studies.'' Through the
approaches announced in this guidance, FDA intends to facilitate early
feasibility studies of medical devices, using appropriate risk
mitigation strategies, under the IDE regulations. Early feasibility
studies allow for limited early clinical evaluations of devices to
provide proof of principle and initial clinical safety data, often
before the device design is finalized. This guidance addresses the
information that should be provided to FDA in support of an early
feasibility study IDE application and explains the requirements
applicable to modifications to the device design or clinical study
protocol during the early feasibility study.

DATES: Submit either electronic or written comments on this guidance at
any time. General comments on Agency guidance documents are welcome at
any time.

ADDRESSES: Submit written requests for single copies of the guidance
document entitled ``Investigational Device Exemptions (IDEs) for Early
Feasibility Medical Device Clinical Studies, Including Certain First in
Human (FIH) Studies'' to the Division of Small Manufacturers,
International, and Consumer Assistance, Center for Devices and
Radiological Health (CDRH), Food and Drug Administration, 10903 New
Hampshire Ave., Bldg. 66, Rm. 4613, Silver Spring, MD 20993-0002 or
Office of Communication, Outreach and Development (HFM-40), Center for
Biologics Evaluation and Research (CBER), Food and Drug Administration,
1401 Rockville Pike, Suite 200N, Rockville, MD 20852-1448. Send one
self-addressed adhesive label to assist that office in processing your
request, or fax your request to<PHONE_NUMBER>. See the SUPPLEMENTARY
INFORMATION section for information on electronic access to the
guidance.
    Submit electronic comments on the guidance to http://www.regulations.gov. Submit written comments to the Division of Dockets
Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane,
Rm. 1061, Rockville, MD 20852. Identify comments with the docket number
found in brackets in the heading of this document.

FOR FURTHER INFORMATION CONTACT: Dorothy Abel, Center for Devices and
Radiological Health, Food and Drug Administration, 10903 New Hampshire
Ave., Bldg. 66, Rm. 1204, Silver Spring, MD 20993-0002,<PHONE_NUMBER>;
or Stephen Ripley, Center for Biologics Evaluation and Research (HFM-
17), Food and Drug Administration, 1401 Rockville Pike, Suite 200N,
Rockville, MD 20852,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Background

    This guidance is intended to provide assistance to FDA staff,
clinicians, medical device innovators, and industry on the development
and review of IDE applications (21 CFR 812.20) for early feasibility
studies of significant risk devices. Early feasibility studies allow
for early clinical evaluation of devices to provide proof of principle
and initial clinical safety data in a limited number of subjects.
During these studies, iterative device modifications are likely to be
made based on clinical experience. Early feasibility studies may be
appropriate early in device development when clinical experience is
necessary because nonclinical testing methods are not available or
adequate to provide the information needed to advance the developmental
process. As with all clinical studies, initiation of an early
feasibility study must be justified by an appropriate benefit/risk
analysis and adequate human subject protection measures.
    This guidance discusses the key principles unique to the
justification for, and design of, early feasibility studies, and
outlines the general principles for preparing and reviewing early
feasibility study IDE applications. This guidance is not intended to
address all required elements of an IDE application or to provide a
comprehensive tutorial on best clinical practices for investigational
medical device studies.
    Concurrent with the publication of this guidance in draft, November
10, 2011 (76 FR 70150), FDA initiated a pilot program for early
feasibility study IDE applications (November 10, 2011, 76 FR 70152) to
solicit nominations from sponsors of innovative device technologies. In
addition to making clarifications within the final guidance in response
to comments from the public on the draft guidance, FDA has incorporated
changes based on information learned and experiences gained from the
pilot program.

II. Significance of Guidance

    This guidance is being issued consistent with FDA's good guidance
practices regulation (21 CFR 10.115). This guidance represents the
Agency's current thinking on IDEs for Early Feasibility Medical Device
Clinical Studies. It does not create or confer any rights for or on any
person and does not operate to bind FDA or the public. An alternative
approach may be used if such approach satisfies the requirements of the
applicable statute and regulations.

III. Electronic Access

    Persons interested in obtaining a copy of the guidance may do so by
using the Internet. A search capability for all CDRH guidance documents
is available at http://www.fda.gov/MedicalDevices/DeviceRegulationandGuidance/GuidanceDocuments/default.htm. Guidance
documents are also available at http://www.regulations.gov or from CBER
at http://www.fda.gov/BiologicsBloodVaccines/GuidanceComplianceRegulatoryInformation/default.htm. To receive
``Investigational Device Exemptions (IDEs) for Early Feasibility
Medical Device Clinical Studies, Including Certain First in Human (FIH)
Studies,'' you may either send an email request to<EMAIL_ADDRESS>to receive an electronic copy of the document or send a fax request to
301-847-8149 to receive a hard copy. Please use the document number
1782 to identify the guidance you are requesting.

IV. Paperwork Reduction Act of 1995

    This guidance refers to previously approved collections of
information found in FDA regulations. These collections of information
are subject to review by the Office of Management and Budget (OMB)
under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The
collections of information in 21 CFR part 812 have been approved under
OMB control number 0910-0078;

and the collections of information in 21 CFR 56.115 have been approved
under OMB control number 0910-0130.

V. Comments

    Interested persons may submit either electronic comments regarding
this document to http://www.regulations.gov or written comments to the
Division of Dockets Management (see ADDRESSES). It is only necessary to
send one set of comments. Identify comments with the docket number
found in brackets in the heading of this document. Received comments
may be seen in the Division of Dockets Management between 9 a.m. and 4
p.m., Monday through Friday, and will be posted to the docket at http://www.regulations.gov.

    Dated: September 25, 2013.
Leslie Kux,
Assistant Commissioner for Policy.
[FR Doc. 2013-23795 Filed 9-30-13; 8:45 am]
BILLING CODE 4160-01-P


EPA REGISTRATION DIVISION COMPANY NOTICE OF FILING FOR PESTICIDE
PETITIONS PUBLISHED IN THE FEDERAL REGISTER

EPA Registration Division contact: Joanne Miller;<PHONE_NUMBER>

Bayer CropScience

Petition # 8F7452

 Summary of Petitions

EPA has received pesticide petition 8F7452 from Bayer CropScience, 2
T.W. Alexander Drive, Research Triangle Park, NC 27709 proposing,
pursuant to section 408(d) of the Federal Food, Drug, and Cosmetic Act
(FFDCA), 21 U.S.C. 346a(d), to amend 40 CFR part 180 by establishing a
revised tolerance for combined residues of tembotrione,
2-[2-chloro-4-methylsulfonyl)-3-[(2,2,2-trifluoroethoxy)methyl]benzoyl]-
1,3-cyclohexanedione, and its metabolite (M5),
2-[2-chloro-4-(methylsulfonyl)-3-[(2,2,2-trifluoroethoxy)methyl]benzoyl]
-4,6-dihydroxy-1,3-cyclohexanedione,  in or on the raw agricultural
commodities corn, sweet, forage at 0.09 parts per million (ppm), corn,
sweet, kernel plus cob with husks removed at 0.01 ppm, and corn, sweet,
stover at  0.15 ppm.  EPA has determined that the petition contains data
or information regarding the elements set forth in section 408(d)(2) of
the FFDCA; however, EPA has not fully evaluated the sufficiency of the
submitted data at this time or whether the data supports granting of the
petition.  Additional data may be needed before EPA rules on the
petition.

A. Residue Chemistry

	1. Plant metabolism.  The metabolism of tembotrione was determined in
corn forage, stover and grain following treatment of young plants with
14C-labeled material. Hydroxylation and cleavage of the cyclohexanedione
ring were the major metabolic processes.  The major residues in corn
forage, grain, and stover were the dihydroxylated parent (AE 1417268)
and a benzoic acid cleavage product, (AE 0456148) with lesser amounts of
the benzyl alcohol (AE 1392936) formed by cleavage of the ether bond of
the benzoic acid.

	2. Analytical method.  Independently validated, analytical methods
for plants, plant products and animal matrices, suitable for enforcement
purposes, have been submitted for measuring  tembotrione and all
significant metabolites.  Typically, residues are extracted from plant
or animal using accelerated solvent extraction.  Following
concentration, quantitation is by LC/MS/MS using deuterated internal
standards.  AE 1392936 requires additional clean-up by anion exchange,
solid phase extraction prior to quantitation.  Determination of AE
1417268 in ruminant samples requires a hexane wash prior to
quantitation.

3. Magnitude of residues.  Additional field residue trials have been
conducted with only one application of tembotrione at rates of 0.067 or
0.082 lb a.i./A, in accordance with the current product label, and
support the proposed reduction in tolerances.

B. Toxicological Profile

1. Acute toxicity.  Technical tembotrione and the formulated product
show low acute toxicity (Toxicity Category III or IV) via the oral,
dermal and inhalation routes of exposure.  Tembotrione was not an eye
irritant or a dermal irritant (Toxicity Category IV), but showed
moderate potential as a contact sensitizer in a Magnusson and Kligman
maximization assay.  The formulated product was slightly irritating to
the eyes and skin, and is not a skin sensitizer via the Buehler Patch
Test with guinea pigs.  In an acute neurotoxicity screening battery in
rats, the NOAEL was 200 mg/kg body weight based on decreased motor
activity.  There was no evidence of neurotoxicity following an acute
exposure to tembotrione.

	2. Genotoxicty.  Tembotrione was tested for its genotoxic potential in
a battery of five in vitro or in vivo studies covering all required
end-points (gene mutations, chromosomal aberrations, and DNA damage and
repair).   Tembotrione showed some evidence of clastogenic activity, but
only at toxic concentrations.  All other studies were negative for
genotoxicity.  Based on the weight of evidence, tembotrione is not
genotoxic.

	3. Reproductive and developmental toxicity.  Tembotrione inhibits the
4-hydroxyphenylpyruvate dioxygenase (4-HPPD) enzyme in the metabolism of
tyrosine. Inhibition of this enzyme results in increased serum tyrosine
levels and eventually in adverse effects in the animal with increased
incidences of corneal opacity, decreased body-weight, and body-weight
gains. The reproductive and developmental toxicity of tembotrione was
investigated in a 2-generation reproductive toxicity study, as well as
in rat and rabbit teratology studies.  In the 2-generation reproductive
toxicity study a parental/systemic NOAEL was not established but the
LOAEL was 1.4 mg/kg based on corneal opacity, inflammation and
neovascularization.  An offspring NOAEL was not determined but the LOAEL
was 1.4 mg/kg based on corneal opacity, acute inflammation, and
neovascularization; increased incidences of minimal extramedullary
hematopoeisis in the spleen, delayed preputial separation, and decreased
absolute brain weight.  There was no evidence of reproductive toxicity
or offspring susceptibility.  In the rat developmental toxicity study
the maternal NOAEL was 25 mg/kg bw/day based on decreased body weight
gains and food consumption.  The developmental NOAEL was less than 25
mg/kg/day based on decreased fetal body weights, increased number of
runts, and increased skeletal variations.  In the rabbit developmental
toxicity study the maternal NOAEL was 10 mg/kg based on reduced food
consumption, few feces, abortion, and decreased body weight.  The
developmental NOAEL was 1 mg/kg bw/day based on increase incidence of
skeletal anomalies and variations in the fetuses.  Skeletal variations
have been noted with exposure to other HPPDase inhibiting compounds.  In
a developmental neurotoxicity study in rats the maternal NOAEL was 0.8
mg/kg bw/day based on decreased body weight and body weight gain and
corneal opacities.  An offspring NOAEL was not determined and the LOAEL
was 0.8 mg/kg based on decreased post-weaning body weight (males),
decreased acoustic startle response on PND 60 (males), and brain
morphometric changes on PND 75 (males and females).  The lower body
weight effects resulted in delayed preputial separation and decreased
acoustic startle response.

4. Subchronic toxicity. The subchronic toxicity of tembotrione was
investigated via the oral route in 90-day feeding studies in mouse, rat
and dog, and via the dermal route in two 28-day dermal toxicity studies
in rat.  In general, there was mild to moderate toxicity observed in
mice and dogs at high doses.  The rat is the most sensitive species,
with the male rat being more sensitive than the female rat.  Effects
were typically seen in the eye, kidney, liver, thyroid and pancreas.
These same effects were also seen in the chronic feeding studies.  The
90-day oral NOAEL in mice was 64 mg/kg bw/day based on liver effects.
The 90-day oral NOAEL resulting from two rat studies was 0.3 mg/kg
bw/day based on corneal opacity in a male rat.  Effects on liver and
kidney were also noted at higher doses.  The 90-day oral NOAEL in the
dog was 26.7 mg/kg bw/day based on reduced body weight, corneal
opacities, hematological changes, clinical chemistry and liver effects.
The 28-day NOAEL resulting from two dermal toxicity studies in rat was
less than 50 mg/kg bw/day based on effects in the pancreas.  Similar
effects have been noted with other HPPDase inhibiting compounds, and
mechanistic data indicates that these effects are likely due to elevated
tyrosine levels due to HPPD inhibition.  A 90-day neurotoxicity study in
rats showed no evidence of neurotoxicity following exposure to
tembotrione.

5. Chronic toxicity.  The chronic toxicity and oncogenic potential of
tembotrione was evaluated in mice, dog and rats.  A NOAEL was not
established (<2.5 mg/kg) in the one year dog feeding study based on
increased number of digestion chambers of the sciatic nerve.  An initial
combined chronic/oncogencity study was initiated in the male and female
rats.  However, a high mortality rate in the high dose males led to
early termination of the male portion of this study.  The female portion
of the study continued through scheduled completion while a new combined
chronic/carcinogenicity study of tembotrione in the male rat by dietary
administration was initiated at lower dose levels.  The resulting
chronic toxicity NOAEL from these two was 0.04 based on eye effects,
decreased body weights, kidney effects and chronic nephropathy and
atrophy of the sciatic nerve.  A chronic toxicity NOAEL in mice was not
determined but the LOAEL was 4 mg/kg based on hematological, liver, gall
bladder and kidney effects.  There was a slight increase in neoplastic
lesions; i.e., squamous cell carcinoma of the cornea at higher dose
levels when compared to controls. This change was considered to be a
result of the keratitis of the eye.  Based on this, the HED CARC has
classified tembotrione as “Suggestive Evidence of Carcinogenic
Potential” and determined that quantification of carcinogenic
potential is not required. The RfD is assumed to be protective of any
potential cancer effects.

	6. Animal metabolism. Metabolism studies conducted in the rat show the
majority of residue was excreted within 48 hours.  A sex difference in
relation to the route of excretion was observed with the females
eliminating higher levels in the urine and the males eliminating higher
levels in the feces. The accumulation of radioactivity in tissues was
not apparent.  The major metabolic process in plants and mammals is
similar but metabolism is less complete in mammals with more limited
hydroxylation and ring cleavage compared to plants. In plants and
mammals monohydroxylation of the cyclohexane dione ring was the major,
initial metabolic process. Further hydroxylation to the dihydroxy
occurred in both but to a lesser extent in mammals than plants. Also the
dihdroxy metabolites formed were positional isomers with the
4,6-dihydroxy being formed in plants and the 4,5-dihydroxy being formed
in mammals. Cleavage of the cyclohexane dione ring to form the benzoic
acid metabolite, AE 046148 (M6) also occurred to a greater extent in
plants than animals. The benzyl alcohol plant metabolite, AE 1392936
(M2) which is closely related to AE 046148 (M6) was not detected in
mammals.

	7. Metabolite toxicology.  Toxicological evaluations of the three major
metabolites of tembotrione were conducted.  None of the metabolites
tested were mutagenic and all indicated lower toxicity than the parent
tembotrione.  AE 1417268 was tested as it was the major metabolite in
animal fodder and a different positional isomer from the related
compound found in mammals.  AE 046148 was tested as it was the major
metabolite found in grain and was only detected at a low level in
mammals.  Some toxicological testing was conducted on AE 1392936
confirming that it has properties similar to the more prevalent, related
molecule AE 046148, which can be considered not of toxicological
concern.

	8. Endocrine disruption.  The toxicology database for tembotrione is
current and complete.  Studies in this database include evaluation of
the potential effects on reproduction and development and an evaluation
of the pathology of the endocrine organs following short- or long-term
exposure.

C. Aggregate Exposure

The proposed reduction in tolerances for sweet corn has no impact on the
existing exposure and risk assessments for tembotrione.  A summary of
the Agency’s dietary and aggregate assessments for tembotrione was
published in the federal register on September 28, 2007.

D. Cumulative Effects

The proposed reduction in tolerances for sweet corn has no impact on
the existing exposure and risk assessments for tembotrione.  A summary
of the Agency’s cumulative assessment for tembotrione was published in
the federal register on September 28, 2007.

E. Safety Determination

The proposed reduction in tolerances for sweet corn has no impact on the
existing exposure and risk assessments for tembotrione.  A summary of
the Agency’s safety determination for tembotrione was published in the
federal register on September 28, 2007.

F. International Tolerances

[Codex MRLs are not yet established for tembotrione.]

 PAGE  2

 PAGE  3

 PAGE  5


[Federal Register Volume 79, Number 210 (Thursday, October 30, 2014)]
[Notices]
[Pages 64589-64590]
[FR Doc No: 2014-25830]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. RM98-1-000]

Records Governing Off-the-Record Communications; Public Notice

    This constitutes notice, in accordance with 18 CFR 385.2201(b), of
the receipt of prohibited and exempt off-the-record communications.
    Order No. 607 (64 FR 51222, September 22, 1999) requires Commission
decisional employees, who make or receive a prohibited or exempt off-
the-record communication relevant to the merits of a contested
proceeding, to deliver to the Secretary of the Commission, a copy of
the communication, if written, or a summary of the substance of any
oral communication.
    Prohibited communications are included in a public, non-decisional
file associated with, but not a part of, the decisional record of the
proceeding. Unless the Commission determines that the prohibited
communication and any responses thereto should become a part of the
decisional record, the prohibited off-the-record communication will not
be considered by the Commission in reaching its decision. Parties to a
proceeding may seek the opportunity to respond to any facts or
contentions made in a prohibited off-the-record communication, and may
request that the Commission place the prohibited communication and
responses thereto in the decisional record. The Commission will grant
such a request only when it determines that fairness so requires. Any
person identified below as having made a prohibited off-the-record
communication shall serve the document on all parties listed on the
official service list for the applicable proceeding in accordance with
Rule 2010, 18 CFR 385.2010.
    Exempt off-the-record communications are included in the decisional
record of the proceeding, unless the communication was with a
cooperating agency as described by 40 CFR 1501.6, made under 18 CFR
385.2201(e) (1) (v).
    The following is a list of off-the-record communications recently
received by the Secretary of the Commission. The communications listed
are grouped by docket numbers in ascending order. These filings are
available for electronic review at the Commission in the Public
Reference Room or may be viewed on the Commission's Web site at http://www.ferc.gov using the eLibrary link. Enter the docket number,
excluding the last three digits, in the docket number field to access
the document. For assistance, please contact FERC Online Support at
<EMAIL_ADDRESS>or toll free at<PHONE_NUMBER>, or for TTY,
contact<PHONE_NUMBER>.

----------------------------------------------------------------------------------------------------------------
             Docket No.                      File date                       Presenter or requester
----------------------------------------------------------------------------------------------------------------
Prohibited:
    1. CP13-113-000.................  9-30-14................  Sean McGarvey.
    2. CP14-17-000..................  10-3 to 10-16-14.......  Chain emails.\1\
    3. EL14-55-000..................  10-20 to 10-22-14......  Chain emails.\2\
    4. ER14-1242-000................  10-22-14...............  Patricia J. Brighton.
    ER14-1243-000...................
Exempt:
    1. ER14-2952-000................  10-8-14................  Hon. Dan Benishek.
    ER14-1242-000...................
    ER14-1243-000...................
    ER14-2862-000...................
    ER14-2860-000...................
    EL14-34-000.....................
    EL14-103-000....................
    EL14-104-000....................
    2. CP14-96-000..................  10-15-14...............  Boston City Council.
    3. CP14-497-000.................  10-17-14...............  Hon. Kirsten Gillibrand.
    4. ER14-1242-000................  10-21-14...............  U.S. Senate.\3\
    ER14-1243-000...................
    5. ER14-1243-000................  10-22-14...............  City of Sault Ste. Marie.
    ER14-2862-000...................
    ER14-2860-000...................
----------------------------------------------------------------------------------------------------------------
\1\ 51 Chain emails have been sent to FERC Commissioners and staff under this docket number.
\2\ 18 Chain emails have been sent to FERC Commissioners and staff under this docket number.
\3\ Letter signed by Hons. Debbie Stabenow and Carl Levin.

    Dated: October 24, 2014.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2014-25830 Filed 10-29-14; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register Volume 78, Number 24 (Tuesday, February 5, 2013)]
[Notices]
[Page 8220]
[FR Doc No: 2013-02475]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

Notice of Release From Quitclaim Deed and Federal Grant Assurance
Obligations for Delano Municipal Airport, Delano, CA

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of Request to Release Airport Land.

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

SUMMARY: The Federal Aviation Administration (FAA) proposes to rule and
invites public comment on the application for a release of
approximately 9.89 acres of airport property at Delano Municipal
Airport, Delano, California from all conditions contained in the
Quitclaim Deed and Grant Assurances since the parcels of land are not
needed for airport purposes. The property will be conveyed at its fair
market value for the benefit of the airport. The use of the land by the
City of Delano will remain the same and represents a continued
compatible land use that will not interfere with the airport or its
operation, thereby protecting the interests of civil aviation.

DATES: Comments must be received on or before March 7, 2013.

FOR FURTHER INFORMATION CONTACT: Comments on the request may be mailed
or delivered to the FAA at the following address: Tony Garcia, Airports
Compliance Program Manager, Federal Aviation Administration, Airports
Division, Federal Register Comment, 15000 Aviation Boulevard, Lawndale,
CA 90261. In addition, one copy of the comment submitted to the FAA
must be mailed or delivered to Mr. Roman Dowling, Public Works
Director, City of Delano, 1015 Eleventh Avenue, P.O. Box 3010, Delano,
California 93216-3010.

SUPPLEMENTARY INFORMATION: In accordance with the Wendell H. Ford
Aviation Investment and Reform Act for the 21st Century (AIR 21),
Public Law 10-181 (Apr. 5, 2000; 114 Stat. 61), this notice must be
published in the Federal Register 30 days before the Secretary may
waive any condition imposed on a federally obligated airport by surplus
property conveyance deeds or grant agreements.
    The following is a brief overview of the request:
    The City of Delano, California requested a release from the
conditions contained in the Quitclaim Deed and Grant Assurance
obligations for approximately 9.89 acres of airport land. The property
is located on the west and north sides of the airport in the vicinity
of Lexington Street. A City public works facility occupies 7.8 acres,
while 2.09 acres serve as part of the city golf course. The land has
not served an airport purpose and will not be needed for future airport
purposes. The land will be conveyed to the City for its fair market
value. The property will continue to be used for the same purpose, so
it will remain a compatible use that will not interfere with airport
operations. The conveyance will not prevent development of the airport,
thereby serving the interests of civil aviation.

    Issued in Hawthorne, California, on January 29, 2013.
Brian Armstrong,
Manager, Safety and Standards, Airports Division, Western-Pacific
Region.
[FR Doc. 2013-02475 Filed 2-4-13; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register Volume 82, Number 218 (Tuesday, November 14, 2017)]
[Notices]
[Page 52722]
[FR Doc No: 2017-24639]

=======================================================================
-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

[FRL-9970-62-OW]

Information Session; Implementation of the Water Infrastructure
Finance and Innovation Act of 2014

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.

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

SUMMARY: The Environmental Protection Agency is announcing plans to
hold an information session on January 17, 2018 in Washington, DC. The
purpose the session is to provide prospective borrowers with a better
understanding of the Water Infrastructure Finance and Innovation Act
(WIFIA) program requirements and application process.

DATES: The session in Washington, DC will be held on January 17, 2018
from 9:00 a.m.-3:00 p.m. (MT).

ADDRESSES: The session in Washington, DC will be held at: U.S. EPA
Headquarters, William Jefferson Clinton East Building, 1201
Constitution Avenue NW., Washington, DC 20004.
    To Register: Registration information is available at https://www.epa.gov/wifia.

FOR FURTHER INFORMATION CONTACT: For further information about this
notice, including registration information, contact Karen Fligger, EPA
Headquarters, Office of Water, Office of Wastewater Management at tel.:
202-564-2992; or email: [email protected].
    Members of the public are invited to participate in the session as
capacity allows.

SUPPLEMENTARY INFORMATION: Under WIFIA (33 U.S.C. 3901 et seq.), EPA
can provide long-term, low-cost supplemental loans and loan guarantees
for regionally and nationally significant water infrastructure
projects. During the information session, EPA will provide an overview
of the program's statutory and eligibility requirements, application
and selection process, and creditworthiness assessment. It will also
explain the financial benefits of WIFIA credit assistance and provide
tips for completing the application materials. The intended audience is
prospective borrowers including municipal entities, corporations,
partnerships, and State Revolving Fund programs, as well as the private
and non-governmental organizations that support prospective borrowers.

    Authority: Water Infrastructure Finance and Innovation Act, 33
U.S.C. 3901 et seq.

    Dated: November 2, 2017.
Andrew D. Sawyers,
Director, Office of Wastewater Management.
[FR Doc. 2017-24639 Filed 11-13-17; 8:45 am]
 BILLING CODE 6560-50-P


[Federal Register Volume 80, Number 115 (Tuesday, June 16, 2015)]
[Rules and Regulations]
[Pages 34258-34261]
[FR Doc No: 2015-14396]

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

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2014-0249; Directorate Identifier 2012-NM-211-AD;
Amendment 39-18180; AD 2015-12-06]
RIN 2120-AA64

Airworthiness Directives; Learjet Inc. Airplanes

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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

SUMMARY: We are adopting a new airworthiness directive (AD) for certain
Learjet Inc. Model 45 airplanes. This AD was prompted by reports of
non-conforming windshield supports (coupe rails). This AD requires a
general visual inspection of the coupe rails to detect gouging and
scratches, and to determine if a radius has been removed; an ultrasound
inspection to measure the dimensions of the lower coupe rails; an eddy
current inspection to detect cracks of the lower coupe rails;
replacement of

the lower coupe rails if necessary; and revision of the maintenance or
inspection program, as applicable. We are issuing this AD to detect and
correct non-conforming windshield supports, which could result in
uncontrolled cabin depressurization and compromise of the capability of
the windshield to withstand a bird strike.

DATES: This AD is effective July 21, 2015.
    The Director of the Federal Register approved the incorporation by
reference of certain publications listed in this AD as of July 21,
2015.

ADDRESSES: For service information identified in this AD, contact
Learjet, Inc., One Learjet Way, Wichita, KS 67209-2942; telephone 316-
946-2000; fax<PHONE_NUMBER>; email<EMAIL_ADDRESS>Internet
http://www.bombardier.com. You may view this referenced service
information at the FAA, Transport Airplane Directorate, 1601 Lind
Avenue SW., Renton, WA. For information on the availability of this
material at the FAA, call<PHONE_NUMBER>. It is also available on the
Internet at http://www.regulations.gov by searching for and locating
Docket No. FAA-2014-0249.

Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2014-
0249; 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 AD, the regulatory evaluation, any comments received, and
other information. The address for the Docket Office (phone: 800-647-
5527) is Docket Management Facility, U.S. Department of Transportation,
Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200
New Jersey Avenue SE., Washington, DC 20590.

FOR FURTHER INFORMATION CONTACT: Paul Chapman, Aerospace Engineer,
Airframe Branch, ACE-118W, FAA, Wichita Aircraft Certification Office,
1801 Airport Road, Room 100, Mid-Continent Airport, Wichita, KS 67209;
phone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Discussion

    We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR
part 39 by adding an AD that would apply to certain Learjet Inc. Model
45 airplanes. The NPRM published in the Federal Register on April 16,
2014 (79 FR 21416). The NPRM was prompted by reports of non-conforming
windshield supports (coupe rails). The NPRM proposed to require a
general visual inspection to detect gouging and scratches and to
determine if a radius has been removed; an ultrasound inspection to
measure the dimensions of the lower coupe rails; an eddy current
inspection to detect cracks of the lower coupe rails; replacement of
the lower coupe rails if necessary; and revision of the maintenance or
inspection program, as applicable. We are issuing this AD to detect and
correct non-conforming windshield supports, which could result in
uncontrolled cabin depressurization. Non-conforming windshield supports
could also compromise the capability of the windshield to withstand a
bird strike.

Explanation of Changes Made to Paragraph (h) of This AD

    We revised paragraph (h) of this AD to state that incorporation of
certain tasks into the maintenance or inspection program, as
applicable, must be done in accordance with a method approved by the
Manager, Wichita Aircraft Certification Office (ACO), ACE-115W, FAA.
For informational purposes, we have added new Notes 1 and 2 to
paragraph (h) of this AD to refer to the latest maintenance manuals as
guidance material for revising the maintenance or inspection program.
(Earlier revisions were referenced previously in table 1 to paragraph
(h) of the NPRM (79 FR 21416, April 16, 2014)). The change to this AD
should allow operators to obtain appropriate versions of maintenance
manuals in order to facilitate compliance.

Comments

    We gave the public the opportunity to participate in developing
this AD. The following presents the comments received on the NPRM (79
FR 21416, April 16, 2014), and the FAA's response to each comment.

Request for Credit for Previous Actions

    Learjet Inc. requested that we revise the NPRM (79 FR 21416, April
16, 2014) to clarify whether actions accomplished using Bombardier
Recommended Service Bulletin 40-56-03, dated April 30, 2012; or
Bombardier Recommended Service Bulletin 45-56-3, dated April 30, 2012;
is acceptable for compliance with the actions required by paragraph (g)
of the NPRM. Learjet Inc. reasoned that many operators have already
done those actions using this service information.
    We agree to clarify. Actions required by paragraph (g) of this AD,
if performed before the effective date of this AD using Bombardier
Recommended Service Bulletin 40-56-03, dated April 30, 2012; or
Bombardier Recommended Service Bulletin 45-56-3, dated April 30, 2012;
as applicable; are acceptable for compliance with the requirements of
paragraph (g) of this AD. We have added a new paragraph (j) to this AD
to provide credit for these actions. We have redesignated subsequent
paragraphs accordingly.

Request To Incorporate Updated Inspection Reference Number (IRN)

    Learjet Inc. requested that we revise table 1 to paragraph (h) of
the NPRM (79 FR 21416, April 16, 2014) to allow the incorporation of
IRN V5323168, as specified in Bombardier Learjet 45 Maintenance Manual
(MM) MM-104, Revision 62; and Bombardier Learjet 40 Maintenance Manual
MM-105 Revision 30; both dated June 2, 2014. Learjet Inc. explained
that IRN U5323168 was revised to V5323168 in Bombardier Learjet 45
Maintenance Manual MM-104, Revision 62; and Bombardier Learjet 40
Maintenance Manual MM-105, Revision 30; both dated June 2, 2014.
Learjet Inc. stated that there were no actual changes to the content of
the IRN in Chapter 4 of the MMs, but the ``U'' was revised to a ``V''
to coincide with changes to the verbiage in the same IRN in Chapter 5
of those MMs.
    As discussed previously, we added new Notes 1 and 2 to paragraph
(h) of this AD to refer to the latest revisions of the maintenance
manuals, which include references to the appropriate IRNs referenced by
the commenter. No additional change to this AD is necessary.

Conclusion

    We reviewed the relevant data, considered the comments received,
and determined that air safety and the public interest require adopting
this AD with the changes described previously and minor editorial
changes. We have determined that these minor changes:
     Are consistent with the intent that was proposed in the
NPRM (79 FR 21416, April 16, 2014) for correcting the unsafe condition;
and
     Do not add any additional burden upon the public than was
already proposed in the NPRM (79 FR 21416, April 16, 2014).
    We also determined that these changes will not increase the
economic burden on any operator or increase the scope of this AD.

Related Service Information Under 1 CFR Part 51

    We reviewed Bombardier Recommended Service Bulletin 40-56-03,
Revision 1, dated October 15, 2012; and Bombardier Recommended Service
Bulletin 45-56-3, Revision 1, dated October 15, 2012. The service
information describes procedures for a general visual inspection of the
coupe rails to detect gouging and scratches, and to determine if a
radius has been removed; an ultrasound inspection to measure the
dimensions of the lower coupe rails; an eddy current inspection to
detect cracks of the lower coupe rails; and replacement of the lower
coupe rails if necessary. This service information is reasonably
available because the interested parties have access to it through
their normal course of business or by the means identified in the
ADDRESSES section of this AD.

Costs of Compliance

    We estimate that this AD affects 351 airplanes of U.S. registry.
    We estimate the following costs to comply with this AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost on U.S.
             Action                   Labor cost          Parts cost       Cost per product        operators
----------------------------------------------------------------------------------------------------------------
Inspection......................  40 work-hours x     $77...............  $3,477 per          $1,220,427 per
                                   $85 per hour =                          inspection cycle.   inspection cycle.
                                   $3,400 per
                                   inspection cycle.
Maintenance or inspection         1 work hour x $85   None..............  $85...............  $29,835.
 program revision.                 per hour = $85.
----------------------------------------------------------------------------------------------------------------

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

                                               On-Condition Costs
----------------------------------------------------------------------------------------------------------------
               Action                         Labor cost                Parts cost           Cost per product
----------------------------------------------------------------------------------------------------------------
Replacement........................  500 work-hours (to replace   $15,000 (to replace     $57,500 (to replace
                                      both coupe rails) x $85      both coupe rails).      both coupe rails).
                                      per hour = $42,500.
----------------------------------------------------------------------------------------------------------------

    According to the manufacturer, some of the costs of this AD may be
covered under warranty, thereby reducing the cost impact on affected
individuals. We do not control warranty coverage for affected
individuals. As a result, we have included all costs in our cost
estimate.

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

    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 that this AD:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866,
    (2) Is not a ``significant rule'' under DOT Regulatory Policies and
Procedures (44 FR 11034, February 26, 1979),
    (3) Will not affect intrastate aviation in Alaska, and
    (4) 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.

List of Subjects in 14 CFR Part 39

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

Adoption of the Amendment

    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 adding the following new airworthiness
directive (AD):

2015-12-06 Learjet Inc.: Amendment 39-18180; Docket No. FAA-2014-
0249; Directorate Identifier 2012-NM-211-AD.

(a) Effective Date

    This AD is effective July 21, 2015.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to Learjet Inc. Model 45 airplanes, certificated
in any category, as identified in Bombardier Recommended Service
Bulletin 40-56-03, Revision 1, dated October 15, 2012 (for airplanes
having serial numbers (S/Ns) 45-2000 through 45-2120 inclusive, and
S/Ns 45-2122 through 45-2130 inclusive); and Bombardier Recommended
Service Bulletin 45-56-3, Revision 1, dated October 15, 2012 (for
airplanes having S/Ns 45-005 through 45-427 inclusive).

(d) Subject

    Air Transport Association (ATA) of America Code 53, Fuselage.

(e) Unsafe Condition

    This AD was prompted by reports of non-conforming windshield
supports (coupe rails). We are issuing this AD to detect and correct
non-conforming windshield supports, which could result in
uncontrolled cabin depressurization, and compromise of the
capability of the windshield to withstand a bird strike.

(f) Compliance

    Comply with this AD within the compliance times specified,
unless already done.

(g) Inspections and Corrective Actions

    Within 600 flight hours or 36 months after the effective date of
this AD, whichever occurs first: Do the inspections specified in
paragraphs (g)(1) through (g)(3) of this AD. Do all inspections and
corrective actions specified in paragraphs (g)(1) through (g)(3) of
this AD, in accordance with the Accomplishment Instructions of
Bombardier Recommended Service Bulletin 40-56-03, Revision 1, dated
October 15, 2012 (for airplanes having S/Ns 45-2000 through 45-2120
inclusive, and 45-2122 through 45-2130 inclusive); or Bombardier
Recommended Service Bulletin 45-56-3, Revision 1, dated October 15,
2012 (for airplanes having S/Ns 45-005 through 45-427 inclusive).
    (1) Do a general visual inspection of the coupe rails to detect
gouging and scratches and to determine whether a radius has been
removed or damaged.
    (i) If gouging or scratches are found, before further flight,
burnish or blend the gouges and scratches.
    (ii) If the radius has been removed or damaged, before further
flight, restore the radius.
    (2) Do an ultrasound inspection to measure the dimensions of the
lower coupe rails.
    (i) If the coupe rail has an ``X'' dimension of 0.246 (6.248
millimeters (mm)) or greater, and a ``Y'' dimension of 0.148 (3.759
mm) or greater: Before further flight, identify the coupe rail, in
accordance with table 1 of Bombardier Recommended Service Bulletin
40-56-03, Revision 1, dated October 15, 2012 (for airplanes having
S/Ns 45-2000 through 45-2120 inclusive, and S/Ns 45- 2122 through
45-2130 inclusive); or Bombardier Recommended Service Bulletin 45-
56-3, Revision 1, dated October 15, 2012 (for airplanes having S/Ns
45-005 through 45-427 inclusive).
    (ii) If the coupe rail has an ``X'' dimension between 0.246
(6.248 mm) and 0.166 (4.216 mm) or a ``Y'' dimension between 0.148
(3.759 mm) and 0.134 (3.403 mm): Before further flight, identify the
coupe rail, in accordance with table 2 of Bombardier Recommended
Service Bulletin 40-56-03, Revision 1, dated October 15, 2012 (for
airplanes having S/Ns 45-2000 through 45-2120 inclusive, and S/Ns
45- 2122 through 45-2130 inclusive); or Bombardier Recommended
Service Bulletin 45-56-3, Revision 1, dated October 15, 2012 (for
airplanes having S/Ns 45-005 through 45-427 inclusive).
    (iii) If any coupe rail ``X'' dimension is below 0.166 (4.216
mm) or ``Y'' dimension is below 0.134 (3.403 mm): Before further
flight, replace that coupe rail with a new coupe rail.
    (3) Do a flange and radius eddy current inspection for cracks of
the left-hand and right-hand lower coupe rails.
    (i) If no crack is found, before further flight, mark the new
data plate.
    (ii) If any crack is found, before further flight, replace the
coupe rail with a new coupe rail.

(h) Maintenance/Inspection Program Revision

    Within 30 days after the effective date of this AD: Revise the
maintenance or inspection program (as applicable) to incorporate
tasks for inspections of the lower coupe rail radius/windscreen
retainer attach and replacement of the coupe rails, in accordance
with a method approved by the Manager, Wichita Aircraft
Certification Office (ACO), ACE-115W, FAA.

    Note 1 to paragraph (h) of this AD: For Model 40 airplanes, the
instructions provided in Bombardier Learjet 40 Maintenance Manual
MM-105, Revision 30, dated June 2, 2014, provide guidance for
revising the maintenance or inspection program to include
replacements of the coupe rails and maintenance requirements/
structure checks of the lower coupe rail radius/windscreen retainer
attach. This service information is not incorporated by reference in
this AD.

    Note 2 to paragraph (h) of this AD: For Model 45 airplanes, the
instructions provided in Bombardier Learjet 45 Maintenance Manual
MM-104, Revision 62, dated June 2, 2014, provide guidance for
revising the maintenance or inspection program to include
replacements of the coupe rails and maintenance requirements/
structure checks of the lower coupe rail radius/windscreen retainer
attach. This service information is not incorporated by reference in
this AD.

(i) No Alternative Actions or Intervals

    After accomplishing the revision required by paragraph (h) of
this AD, no alternative IRN task or interval may be used unless the
IRN task or interval is approved as an alternative method of
compliance (AMOC) in accordance with the procedures specified in
paragraph (k) of this AD.

(j) Credit for Previous Actions

    This paragraph provides credit for actions required by paragraph
(g) of this AD, if those actions were performed before the effective
date of this AD using Bombardier Recommended Service Bulletin 40-56-
03, dated April 30, 2012 (for airplanes having S/Ns 45-2000 through
45-2120 inclusive, and 45-2122 through 45-2130 inclusive); or
Bombardier Recommended Service Bulletin 45-56-3, dated April 30,
2012 (for airplanes having S/Ns 45-005 through 45-427 inclusive);
which are not incorporated by reference in this AD.

(k) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Wichita ACO, FAA, has the authority to approve
AMOCs for this AD, if requested using the procedures found in 14 CFR
39.19. In accordance with 14 CFR 39.19, send your request to your
principal inspector or local Flight Standards District Office, as
appropriate. If sending information directly to the manager of the
ACO, send it to the attention of the person identified in paragraph
(l)(1) of this AD.
    (2) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the local flight standards district office/certificate holding
district office.

(l) Related Information

    (1) For more information about this AD, contact Paul Chapman,
Aerospace Engineer, Airframe Branch, ACE-118W, FAA, Wichita ACO,
1801 Airport Road, Room 100, Mid-Continent Airport, Wichita, KS
67209; phone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; email:
<EMAIL_ADDRESS>    (2) Service information identified in this AD that is not
incorporated by reference is available at the addresses specified in
paragraphs (m)(3) and (m)(4) of this AD.

(m) Material Incorporated by Reference

    (1) The Director of the Federal Register approved the
incorporation by reference (IBR) of the service information listed
in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
    (2) You must use this service information as applicable to do
the actions required by this AD, unless the AD specifies otherwise.
    (i) Bombardier Recommended Service Bulletin 40-56-03, Revision
1, dated October 15, 2012.
    (ii) Bombardier Recommended Service Bulletin 45-56-3, Revision
1, dated October 15, 2012.
    (3) For service information identified in this AD, contact
Learjet, Inc., One Learjet Way, Wichita, KS 67209-2942; telephone
316-946-2000; fax<PHONE_NUMBER>; email<EMAIL_ADDRESS>
Internet http://www.bombardier.com.
    (4) You may view this service information at FAA, Transport
Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For
information on the availability of this material at the FAA, call
425-227-1221.
    (5) You may view this 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<PHONE_NUMBER>, or go to: http://www.archives.gov/federal-register/cfr/ibr-locations.html.

    Issued in Renton, Washington, on June 3, 2015.
Jeffrey E. Duven,
Manager, Transport Airplane Directorate, Aircraft Certification
Service.
[FR Doc. 2015-14396 Filed 6-15-15; 8:45 am]
 BILLING CODE 4910-13-P