[Federal Register Volume 77, Number 223 (Monday, November 19, 2012)]
[Notices]
[Pages 69519-69522]
[FR Doc No: 2012-28000]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68209; File No. SR-NASDAQ-2012-126]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Modify NASDAQ's Rebates for Order Execution and Its Fees for Order
Entry Ports Through the Introduction of New Market Quality Incentive
Programs on a Pilot Basis

November 9, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on November 1, 2012, The NASDAQ Stock Market LLC (``NASDAQ'' or the
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') a proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    NASDAQ is proposing a change to modify rebates for order execution
and its fees for order entry ports through the introduction of new
market quality incentive programs on a pilot basis. NASDAQ will
implement the proposed change on November 1, 2012. The text of the
proposed rule change is available at http://nasdaq.cchwallstreet.com,
at NASDAQ's principal office, and at the Commission's Public Reference
Room.

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

    In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text

of those statements may be examined at the places specified in Item IV
below. The Exchange has prepared summaries, set forth in sections A, B,
and C below, of the most significant parts of such statements.

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

1. Purpose
    NASDAQ is introducing two new pricing programs designed to create
incentives for members to improve market quality. The programs will be
in effect on a pilot basis from November 1, 2012 until April 30, 2013,
subject to being modified, terminated, extended, or made permanent
through a subsequent proposed rule change. The pilot nature of the
proposals will allow NASDAQ to assess and report to the Commission on
the effects of the programs on bid-ask spreads, depth of liquidity at
the inside, and such other factors as may be deemed relevant.
    First, under the NBBO Setter Incentive program, NASDAQ will provide
an enhanced liquidity provider rebate with respect to displayed
liquidity-providing orders that set the national best bid or best offer
(``NBBO'') or join another trading center with a protected quotation at
the NBBO. The NBBO Setter Incentive credit will be paid on a monthly
basis, and the amount will be determined by multiplying $0.0005 or
$0.0002 by the number of shares of displayed liquidity provided to
which a particular rate applies. A member will receive an NBBO Setter
Incentive credit at the $0.0002 rate with respect to all shares of
displayed liquidity that are executed at a price of $1 or more in the
Nasdaq Market Center during a given month if posted through an order
that:
     Displayed a quantity of at least one round lot at the time
of execution; and
     Either established the NBBO or was the first order posted
on NASDAQ that had the same price as an order posted at another trading
center with a protected quotation that established the NBBO. Thus, the
credit will be paid for orders that incur risk by setting the inside
market or allowing NASDAQ to join another trading center that has
already set the inside market, thereby aiding price discovery and
NASDAQ's market quality. The credit will not be paid with respect to
orders that join another order on NASDAQ that has already established
or joined the NBBO.
    A member will receive an NBBO Setter Incentive credit at the
$0.0005 rate with respect to all shares of displayed liquidity that are
executed at a price of $1 or more in the NASDAQ Market Center during a
given month if posted through an order that:
     Displayed a quantity of at least one round lot at the time
of execution;
     Either established the NBBO or was the first order posted
on Nasdaq that had the same price as an order posted at another trading
center with a protected quotation that established the NBBO; and
     Was entered through a market participant identifier
(``MPID'') that qualified for the Qualified Market Maker (``QMM'')
program during the month. The QMM program is the other market quality
incentive being introduced by NASDAQ in this proposed rule change, and
is discussed below.

Similar to other market quality incentive programs already in place at
NASDAQ, such as the Investor Support Program, an NBBO Setter Incentive
credit will be in addition to (and will not replace) any other credit
or rebate for which a member may qualify. The program is similar to a
provision of the fee schedule of the BATS Exchange, Inc. (``BATS''),
under which BATS pays its members an additional rebate of $0.0002 per
share executed for displayed liquidity that sets the NBBO (provided the
member has an average daily volume equal to or greater than 0.5% of the
total consolidated volume during the month).\3\
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    \3\ See http://cdn.batstrading.com/resources/regulation/rule_book/BZX_Fee_ Schedule.pdf (``$0.0002 additional rebate per share
for adding displayed liquidity to the BZX Exchange order book on an
order that sets the NBBO for Members who have an ADV equal to or
greater than 0.5% of TCV'').
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Qualified Market Maker Program
    NASDAQ is proposing a market quality incentive program under which
a member may be designated as a QMM with respect to one or more of its
MPIDs if:
     The member is not assessed any ``Excess Order Fee'' under
Rule 7018 during the month; \4\ and
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    \4\ Rule 7018(m). NASDAQ recently introduced an Excess Order
Fee, aimed at reducing inefficient order entry practices of certain
market participants that place excessive burdens on the systems of
NASDAQ and its members and that may negatively impact the usefulness
and life cycle cost of market data. In general, the determination of
whether to impose the fee on a particular MPID is made by
calculating the ratio between (i) entered orders, weighted by the
distance of the order from the NBBO, and (ii) orders that execute in
whole or in part. The fee is imposed on MPIDs that have an ``Order
Entry Ratio'' of more than 100.
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     Through such MPID the member quotes at the NBBO at least
25% of the time during regular market hours \5\ in an average of at
least 1,000 securities during the month.\6\
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    \5\ Defined as 9:30 a.m. through 4:00 p.m., or such shorter
period as may be designated by NASDAQ on a day when the securities
markets close early (such as the day after Thanksgiving).
    \6\ A member MPID is considered to be quoting at the NBBO if it
has a displayed order at either the national best bid or the
national best offer or both the national best bid and offer. On a
daily basis, NASDAQ will determine the number of securities in which
the member satisfied the 25% NBBO requirement. To qualify for QMM
designation, the MPID must meet the requirement for an average of
1,000 securities per day over the course of the month. Thus, if a
member MPID satisfied the 25% NBBO requirement in 900 securities for
half the days in the month, and satisfied the requirement for 1,100
securities for the other days in the month, it would meet the
requirement for an average of 1,000 securities.
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    Thus, to be a QMM, a member must make a significant contribution to
market quality by providing liquidity at the NBBO in a large number of
stocks for a significant portion of the day. In addition, the member
must avoid imposing the burdens on NASDAQ and its market participants
that may be associated with excessive rates of entry of orders away
from the inside and/or order cancellation. A QMM may be, but is not
required to be, a registered market maker in any security; thus, the
QMM designation does not by itself impose a two-sided quotation
obligation or convey any of the benefits associated with being a
registered market maker. The designation will, however, reflect the
QMM's commitment to provide meaningful and consistent support to market
quality and price discovery by extensive quoting at the NBBO in a large
number of securities. Thus, the program is designed to attract
liquidity both from traditional market makers and from other firms that
are willing to commit capital to support liquidity at the NBBO. Through
these incentives, NASDAQ hopes to provide improved trading conditions
for all market participants through narrower bid-ask spreads and
increased depth of liquidity available at the inside market. In
addition, the program reflects an effort to use financial incentives to
encourage a wider variety of members, including members that may be
characterized as high-frequency trading firms, to make positive
commitments to promote market quality.
    A member that is a QMM with respect to a particular MPID will
receive:
     An NBBO Setter Incentive credit of $0.0005 with respect to
orders that qualify for the NBBO Setter Incentive program (i.e.,
displayed orders with a size of at least one round lot that set the
NBBO or join another trading center at the NBBO) and that are entered
through that MPID; and
     A 25% discount on fees for ports used for entering orders
for that MPID,

up to a total discount of $10,000 per MPID per month.\7\ As provided in
amendments to Rule 7015, the specific fees subject to this discount
are: (i) All ports using the NASDAQ Information Exchange (``QIX'')
protocol,\8\ (ii) Financial Information Exchange (``FIX'') trading
ports,\9\ and (iii) ports using other trading telecommunications
protocols.\10\
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    \7\ The ports subject to the discount are not used for receipt
of market data.
    \8\ The applicable undiscounted fees are $1,200 per month for a
port pair or ECN direct connection port pair, and $1,000 per month
for an unsolicited message port. See Rule 7015(a).
    \9\ The applicable undiscounted fee is $500 per port per month.
See Rule 7015(b).
    \10\ The applicable undiscounted fee is $500 per port pair per
month. See Rule 7015(g).
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    NASDAQ is proposing these discounts as a means of recognizing the
value of market participants that consistently quote at the NBBO in a
large number of securities. Even when such market participants are not
formally registered as market makers, they risk capital by offering
immediately executable liquidity at the price most favorable to market
participants on the opposite side of the market. Such activity promotes
price discovery and dampens volatility and enhances the attractiveness
of NASDAQ as a trading venue. A discount on order entry port fees is an
appropriate incentive to encourage broad-based liquidity provision
because active management of quotes across over 1,000 securities may
require a member to employ numerous order entry ports. NASDAQ further
notes that the proposed discount on port fees is similar in structure
and purpose to a provision of the fee schedule for BATS's options
market under which the $1,000 per month fee for a port with bulk-
quoting capabilities is waived if a member achieves certain market
quality standards with respect to options on more than 25 underlying
securities.\11\
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    \11\ See http://cdn.batstrading.com/resources/regulation/rule_book/BZX_Fee_ Schedule.pdf (``fees for logical ports with bulk-
quoting capabilities will be waived for Members achieving QIP
[Quoting Incentive Program] thresholds in more than 25 underlying
securities'').
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    In addition to the foregoing changes, NASDAQ is also modifying the
name of Rule 7014 to reflect the fact that it includes a range of
market quality incentive programs, adding definitions of ``NBBO'',
``trading center'', and ``protected quotation'', and ``regular market
hours'' to the rule, and making conforming changes to the letter
designations of paragraphs within the rule.
2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\12\ in general, and with
Sections 6(b)(4) and 6(b)(5) of the Act,\13\ in particular, in that it
provides for the equitable allocation of reasonable dues, fees and
other charges among members and issuers and other persons using any
facility or system which NASDAQ operates or controls, and is not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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    \12\ 15 U.S.C. 78f.
    \13\ 15 U.S.C. 78f(b)(4) and (5).
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    The proposed NBBO Setter Incentive program is intended to encourage
members to add liquidity at prices that benefit all NASDAQ market
participants and the NASDAQ market itself, and enhance price discovery,
by establishing a new NBBO or allowing NASDAQ to join the NBBO
established by another trading center. NASDAQ believes that the level
of the credits available through the program--$0.0002 or $0.0005 per
share executed--is reasonable, in that it does not reflect a
disproportionate increase above the rebates provided to all members
with respect to the provision of displayed liquidity under Rule 7018,
which range from $0.0020 to $0.00295 per share executed. NASDAQ further
notes that by introducing the program, NASDAQ is reducing fees for
members that set the NBBO or join another market at the NBBO. The
program is consistent with the Act's requirement for an equitable
allocation of fees because members that establish the NBBO or cause
NASDAQ to join another market at the NBBO benefit all investors by
promoting price discovery and increasing the depth of liquidity
available at the inside market. Such members also benefit NASDAQ itself
by enhancing its competitiveness as a market that attracts actionable
orders. Accordingly, NASDAQ believes that it is consistent with an
equitable allocation of fees to pay an enhanced rebate in recognition
of these benefits to NASDAQ and its market participants. NASDAQ further
notes that the program is consistent with an equitable allocation of
fees because it is immediately available to all market participants
that allow NASDAQ to set or join the NBBO, regardless of the size of
the firm or its trading volumes. Finally, NASDAQ believes that the
program and the payment of a higher rebate with respect to qualifying
orders is not unfairly discriminatory because it is intended to promote
the benefits described above, and because the magnitude of the
additional rebate is not unreasonably high in comparison to the rebate
paid with respect to other displayed liquidity-providing orders.
    Similarly, the proposed QMM program is intended to encourage
members to promote price discovery and market quality by quoting at the
NBBO for a significant portion of each day in a large number of
securities, thereby benefitting NASDAQ and other investors by
committing capital to support the execution of orders. With respect to
the enhanced NBBO Setter Incentive rebate provided to QMMs, NASDAQ
believes that the rebate itself is reasonable, equitable, and not
unfairly discriminatory for the reasons discussed above with regard to
the NBBO Setter Incentive program. In addition, NASDAQ believes that it
is reasonable to pay a higher rebate under that program to QMMs because
of the additional commitment to market quality reflected in the quoting
requirements associated with being a QMM. Similarly, NASDAQ believes
that the higher rebate is consistent with an equitable allocation of
fees because a QMM that sets the NBBO is demonstrating both a specific
commitment to the market through the NBBO-setting order and a broad
commitment through its quoting activity throughout the month.
Accordingly, NASDAQ believes that it is consistent with an equitable
allocation to pay a higher rebate in comparison with the rebate for
other NBBO-setting orders. Finally, NASDAQ believes that this higher
rebate is not unfairly discriminatory because it is consistent with the
market quality and competitiveness benefits associated with the program
and because the magnitude of the additional rebate is not unreasonably
high in comparison to the rebate paid with respect to other displayed
liquidity-providing orders.
    NASDAQ believes that the proposed port fee discount for QMMs is
consistent with an equitable allocation of fees because the fees for
connectivity, such as the ports used for order entry, are a significant
component of the overall cost of trading on NASDAQ and other trading
venues. Accordingly, to the extent that a member maintains a
significant presence in the NASDAQ market through the extent of its
quoting at the NBBO, NASDAQ believes that it is equitable to provide
the member a discount on this component of its trading costs. NASDAQ
further believes that the discount is not unfairly discriminatory,
because it is subject to a monthly cap, such that the disparity between
the monthly costs of a QMM and another market participant with a
similar configuration of order entry ports may not exceed $10,000.
Finally, NASDAQ believes that the discount is

reasonable because it will result in a fee reduction for members that
provide the market quality benefits associated with QMM status.
    Finally, NASDAQ notes that it operates in a highly competitive
market in which market participants can readily favor competing venues
if they deem fee levels at a particular venue to be excessive. In such
an environment, NASDAQ must continually adjust its fees to remain
competitive with other exchanges and with alternative trading systems
that have been exempted from compliance with the statutory standards
applicable to exchanges. NASDAQ believes that the proposed rule change
reflects this competitive environment because it is designed to reduce
fees for members that enhance the quality of NASDAQ's market.

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

    NASDAQ does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act, as amended. Because the market
for order execution is extremely competitive, members may readily opt
to disfavor NASDAQ's execution services if they believe that
alternatives offer them better value. By reducing fees for order
execution and order entry ports, the proposal is a manifestation of the
continued intense level of competition in the market for order
execution.

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

    Written comments were neither solicited nor received.

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act.\14\ At any time within 60 days of the
filing of the proposed rule change, the Commission summarily may
temporarily suspend such rule change if it appears to the Commission
that such action is necessary or appropriate in the public interest,
for the protection of investors, or otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.
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    \14\ 15 U.S.C. 78s(b)(3)(A)(ii).
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IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NASDAQ-2012-126 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NASDAQ-2012-126. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NASDAQ-2012-126 and should
be submitted on or before December 10, 2012.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-28000 Filed 11-16-12; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 83, Number 75 (Wednesday, April 18, 2018)]
[Proposed Rules]
[Pages 17121-17123]
[FR Doc No: 2018-08091]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[Docket Number USCG-2018-0215]
RIN 1625-AA00

Safety Zone for Fireworks Display; Upper Potomac River,
Washington Channel, Washington, DC

AGENCY: Coast Guard, DHS.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Coast Guard proposes to establish a safety zone for
certain waters of the Upper Potomac River. This action is necessary to
provide for the safety of life on navigable waters during a fireworks
display in the Washington Channel at Washington, DC on May 10, 2018.
This proposed rulemaking would prohibit persons and vessels from
entering the safety zone unless authorized by the Captain of the Port
Maryland-National Capital Region or a designated representative. We
invite your comments on this proposed rulemaking.

DATES: Comments and related material must be received by the Coast
Guard on or before May 2, 2018.

ADDRESSES: You may submit comments identified by docket number USCG-
2018-0215 using the Federal eRulemaking Portal at http://www.regulations.gov. See the ``Public Participation and Request for
Comments'' portion of the SUPPLEMENTARY INFORMATION section for further
instructions on submitting comments.

FOR FURTHER INFORMATION CONTACT: If you have questions about this
proposed rulemaking, call or email Mr. Ronald Houck, Sector Maryland-
National Capital Region Waterways Management Division, U.S. Coast
Guard; telephone<PHONE_NUMBER>, email [email protected].

SUPPLEMENTARY INFORMATION:

I. Table of Abbreviations

CFR Code of Federal Regulations
COTP Captain of the Port
DHS Department of Homeland Security
FR Federal Register
NPRM Notice of proposed rulemaking
Sec.  Section
U.S.C. United States Code

II. Background, Purpose, and Legal Basis

    On February 27, 2018, The Wharf DC of Washington, DC notified the
Coast Guard that it will be conducting a fireworks display on May 10,
2018, at 9 p.m. Details of the event were provided to the Coast Guard
by the event sponsor on March 23, 2018. The fireworks display will be
conducted by Pyrotecnico, Inc. and launched from a barge located within
the waters of the Washington Channel, at The Wharf DC in Washington,
DC. Hazards from the fireworks display include accidental discharge of
fireworks, dangerous projectiles, and falling hot embers or other
debris. The COTP has determined that potential hazards associated with
the fireworks to be used in this display would be a safety concern for
anyone within 200 feet of the fireworks barge.
    The purpose of this rulemaking is to ensure the safety of vessels
and the navigable waters of the Washington Channel before, during, and
after the scheduled events. The Coast Guard proposes this rulemaking
under authority in 33 U.S.C. 1231.

III. Discussion of Proposed Rule

    The COTP proposes to establish a temporary safety zone in the
Washington Channel on May 10, 2018. The safety zone will cover all
navigable waters of the Washington Channel within 200 feet of the
fireworks barge located within an area bounded on the south by latitude
38[deg]52'30'' W, and bounded on the north by the Francis Case (I-395)
Memorial Bridge, located at Washington, DC. The safety zone would be
enforced from 8:30 p.m. until 10 p.m. on May 10, 2018. The duration of
the safety zone is intended to ensure the safety of vessels and these
navigable waters before, during, and after the scheduled fireworks
display. No vessel or person would be permitted to enter the safety
zone without obtaining permission from the COTP or a designated
representative. The regulatory text we are proposing appears at the end
of this document.

IV. Regulatory Analyses

    We developed this proposed rule after considering numerous statutes
and Executive Orders related to rulemaking. Below we summarize our
analyses based on a number of these statutes and Executive Orders and
we discuss First Amendment rights of protestors.

A. Regulatory Planning and Review

    Executive Orders 12866 and 13563 direct agencies to assess the
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits. Executive Order 13771 directs agencies to control
regulatory costs through a budgeting process. This NPRM has not been
designated a ``significant regulatory action,'' under Executive Order
12866. Accordingly, the NPRM has not been reviewed by the Office of
Management and Budget (OMB), and pursuant to OMB guidance it is exempt
from the requirements of Executive Order 13771.
    This regulatory action determination is based on the size,
duration, and time-of-day of the safety zone. Although vessel traffic
will not be able to safely transit around this safety zone, the impact
would be for 1.5 hours during the evening when vessel traffic in
Washington Channel is normally low. Moreover, the Coast Guard will
issue a Broadcast Notice to Mariners via VHF-FM marine channel 16 about
the zone.

B. Impact on Small Entities

    The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as
amended, requires Federal agencies to consider the potential impact of
regulations on small entities during rulemaking. The term ``small
entities'' comprises small businesses, not-for-profit organizations

that are independently owned and operated and are not dominant in their
fields, and governmental jurisdictions with populations of less than
50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this
proposed rule would not have a significant economic impact on a
substantial number of small entities.
    While some owners or operators of vessels intending to transit the
safety zone may be small entities, for the reasons stated in section
IV.A above, this proposed rule would not have a significant economic
impact on any vessel owner or operator.
    If you think that your business, organization, or governmental
jurisdiction qualifies as a small entity and that this rule would have
a significant economic impact on it, please submit a comment (see
ADDRESSES) explaining why you think it qualifies and how and to what
degree this rule would economically affect it.
    Under section 213(a) of the Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104-121), we want to assist small
entities in understanding this proposed rule. If the rule would affect
your small business, organization, or governmental jurisdiction and you
have questions concerning its provisions or options for compliance,
please contact the person listed in the FOR FURTHER INFORMATION CONTACT
section. The Coast Guard will not retaliate against small entities that
question or complain about this proposed rule or any policy or action
of the Coast Guard.

C. Collection of Information

    This proposed rule would not call for a new collection of
information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3520).

D. Federalism and Indian Tribal Governments

    A rule has implications for federalism under Executive Order 13132,
Federalism, if it has 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. We have analyzed this proposed rule under that Order and
have determined that it is consistent with the fundamental federalism
principles and preemption requirements described in Executive Order
13132.
    Also, this proposed rule does not have tribal implications under
Executive Order 13175, Consultation and Coordination with Indian Tribal
Governments, because it would not have a substantial direct effect on
one or more Indian tribes, on the relationship between the Federal
Government and Indian tribes, or on the distribution of power and
responsibilities between the Federal Government and Indian tribes. If
you believe this proposed rule has implications for federalism or
Indian tribes, please contact the person listed in the FOR FURTHER
INFORMATION CONTACT section.

E. Unfunded Mandates Reform Act

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

F. Environment

    We have analyzed this proposed rule under Department of Homeland
Security Management Directive 023-01 and Commandant Instruction
M16475.lD, which guide the Coast Guard in complying with the National
Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have made
a preliminary determination that this action is one of a category of
actions that do not individually or cumulatively have a significant
effect on the human environment. This proposed rule involves a safety
zone lasting less than 2 hours that would prohibit entry within a
portion of the Washington Channel. Normally such actions are
categorically excluded from further review under paragraph L60(a) of
Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 01. A
preliminary Record of Environmental Consideration supporting this
determination is available in the docket where indicated under
ADDRESSES. We seek any comments or information that may lead to the
discovery of a significant environmental impact from this proposed
rule.

G. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters.
Protesters are asked to contact the person listed in the FOR FURTHER
INFORMATION CONTACT section to coordinate protest activities so that
your message can be received without jeopardizing the safety or
security of people, places, or vessels.

V. Public Participation and Request for Comments

    We view public participation as essential to effective rulemaking,
and will consider all comments and material received during the comment
period. Your comment can help shape the outcome of this rulemaking. If
you submit a comment, please include the docket number for this
rulemaking, indicate the specific section of this document to which
each comment applies, and provide a reason for each suggestion or
recommendation.
    We encourage you to submit comments through the Federal eRulemaking
Portal at http://www.regulations.gov. If your material cannot be
submitted using http://www.regulations.gov, contact the person in the
FOR FURTHER INFORMATION CONTACT section of this document for alternate
instructions.
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docket, visit http://www.regulations.gov/privacyNotice.
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and all public comments, will be in our online docket at http://www.regulations.gov and can be viewed by following that website's
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final rule is published.

List of Subjects in 33 CFR Part 165

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

    For the reasons discussed in the preamble, the Coast Guard proposes
to amend 33 CFR part 165 as follows:

PART 165--REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS

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

    Authority: 33 U.S.C. 1231; 50 U.S.C. 191, 33 CFR 1.05-1, 6.04-1,
6.04-6, and 160.5; and; Department of Homeland Security Delegation
No. 0170.1.

0
2. Add Sec.  165.T05-0215 to read as follows:

Sec.  165.0215  Safety Zone for Fireworks Display; Upper Potomac River,
Washington Channel, Washington, DC.

    (a) Definitions. As used in this section:

    (1) Captain of the Port means the Commander, U.S. Coast Guard
Sector Maryland-National Capital Region.
    (2) Designated representative means any Coast Guard commissioned,
warrant, or petty officer who has been authorized by the Captain of the
Port Maryland-National Capital Region to assist in enforcing the safety
zone described in paragraph (b) of this section.
    (b) Location. The following area is a safety zone: All navigable
waters of the Washington Channel within 200 feet of the fireworks barge
located within an area bounded on the south by latitude 38[deg]52'30''
W, and bounded on the north by the Francis Case (I-395) Memorial
Bridge, located at Washington, DC. All coordinates refer to datum NAD
1983.
    (c) Regulations. The general safety zone regulations found in 33
CFR 165 subpart C apply to the safety zone created by this section.
    (1) All persons are required to comply with the general regulations
governing safety zones found in 33 CFR 165.23.
    (2) Entry into or remaining in this zone is prohibited unless
authorized by the Coast Guard Captain of the Port Maryland-National
Capital Region. All vessels underway within this safety zone at the
time it is implemented are to depart the zone.
    (3) Persons desiring to transit the area of the safety zone must
first obtain authorization from the Captain of the Port Maryland-
National Capital Region or designated representative. To request
permission to transit the area, the Captain of the Port Maryland-
National Capital Region and or designated representatives can be
contacted at telephone number<PHONE_NUMBER> or on Marine Band Radio VHF-
FM channel 16 (156.8 MHz). The Coast Guard vessels enforcing this
section can be contacted on Marine Band Radio VHF-FM channel 16 (156.8
MHz). Upon being hailed by a U.S. Coast Guard vessel, or other Federal,
State, or local agency vessel, by siren, radio, flashing light, or
other means, the operator of a vessel shall proceed as directed. If
permission is granted, all persons and vessels must comply with the
instructions of the Captain of the Port Maryland-National Capital
Region or designated representative and proceed as directed while
within the zone.
    (4) Enforcement officials. The U.S. Coast Guard may be assisted in
the patrol and enforcement of the safety zone by Federal, State, and
local agencies.
    (d) Enforcement. This section will be enforced from 8:30 p.m. until
10 p.m. on May 10, 2018.

    Dated: April 12, 2018.
L.P. Harrison, Jr.,
Captain, U.S. Coast Guard, Captain of the Port Maryland-National
Capital Region.
[FR Doc. 2018-08091 Filed 4-17-18; 8:45 am]
BILLING CODE 9110-04-P