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Animal and Plant Health Inspection Service, USDA.
Final rule.
We are amending the regulations governing the National Poultry Improvement Plan (NPIP). These amendments, among other things, condition indemnity for low pathogenicity avian influenza on adherence to biosecurity plans, clarify existing provisions of the regulations, fix editorial errors, and align the regulations more closely with current producer practices. These changes were voted on and approved by the voting delegates at the NPIP's 2022 National Plan Conference.
Effective October 30, 2025.
Dr. Elena Behnke, National Poultry Improvement Plan, VS, APHIS, USDA, 1506 Klondike Road, Suite 301, Conyers, GA 30094-5104; (770) 922-3496.
The National Poultry Improvement Plan (NPIP, also referred to below as “the Plan”) is a cooperative Federal-State-industry mechanism for controlling certain poultry diseases. The Plan consists of a variety of programs intended to prevent and control poultry diseases. Participation in all Plan programs is voluntary, but breeding flocks, hatcheries, and dealers must first qualify as “U.S. Pullorum-Typhoid Clean” as a condition for participating in the other Plan programs.
The Plan identifies States, independent flocks, hatcheries, dealers, and slaughter plants that meet certain disease control standards specified in the Plan's various programs. As a result, customers can buy poultry that has tested clean of certain diseases or that has been produced under disease-prevention conditions.
The regulations in 9 CFR parts 56, 145, 146, and 147 (referred to below as “the regulations”) contain the provisions of the Plan. The Animal and Plant Health Inspection Service (APHIS) amends these provisions from time to time to incorporate new scientific information and technologies within the Plan, and to ensure the plan reflects changes to the poultry industry itself.
On June 11, 2024, we published in the
We solicited comments concerning our proposal for 60 days ending August 12, 2024. We received eight comments by that date. The comments were from three private citizens, a State department of agriculture, an organization representing turkey production within the United States, an organization representing egg production within the United States, an organization representing State agricultural interests, and an industry group.
Two commenters supported the rule, and one was generally opposed. Other commenters did not articulate an opinion regarding the rule overall but commented on various provisions.
We discuss the comments that we received below, by topic.
One commenter asserted that the proposed rule is excessive, would prove impracticable for domestic producers, and would result in greater importation of foreign poultry products.
The commenter provided no evidence in support of these contentions. The provisions of the proposed rule were largely voluntary and were advanced by the industry itself at the NPIP's 2022 National Plan Conference as being in the industry's best interests.
One commenter suggested that a number of certifications for breeders were cost-prohibitive for small-scale rare and exhibition bird breeders. Specifically, the commenter stated that it could adhere to the testing requirements for U.S. Pullorum Typhoid (PT) clean status, but other certifications for highly pathogenic avian influenza (HPAI) involved cost-prohibitive testing. However, the commenter stated that it had a “closed flock,” that did not augment the flocks through external additions but solely through on-site farm breeding. Based on its understanding of the relevant data, the commenter stated that there was little evidence of vertical transmission of HPAI from hatching eggs to adult birds in such closed production systems. The commenter inquired if we would consider regulatory revisions to clarify that small-scale rare and exhibition bird hatching eggs present a low risk of HPAI transmission.
The commenter claimed difficulty obtaining testing materials due to limited availability from a single manufacturer. The commenter suggested adding regulations that offer options that allow more flexibility when the supply of testing materials is low to reduce breeder burden.
The only prerequisite for NPIP participation is the Pullorum Typhoid (PT) Clean classification. Additional classifications such as HPAI testing and its related costs are voluntary. With regard to the regulatory revisions suggested by the commenter, § 147.44 of the regulations sets forth a submission process for proposed changes to the regulations. Under the terms of that section, under ordinary circumstances, proposals for changes to the regulations should go through the Biennial Conference for consideration, and should be submitted at least 150 days prior to the meeting, with allowance for proposals submitted closer to the date of the meeting to be entertained. Outside of this process, the NPIP General Conference Committee (GCC) may recommend changes to the regulations
The commenter also stated that online marketplaces were functioning as a means of circumventing regulations governing the shipment of hatching eggs.
This concern is outside the scope of the regulations and the jurisdiction of NPIP.
9 CFR part 56 contains our regulations governing the payment of indemnity for low pathogenicity avian influenza (LPAI). The regulations currently require States to maintain initial State response and containment plans (ISRCPs) in order for producers in the State to be eligible for indemnity and/or compensation for 100 percent of eligible costs under the regulations. The regulations further require that each ISRCP must contain a minimum biosecurity plan to be followed by all producers in the State. In our proposed rule, we proposed to clarify that the biosecurity plan is not required for producers below size thresholds for inclusion in the NPIP. However, we also proposed revising the ISRCP requirements to require States to determine that the biosecurity plans are in place and being followed and to require States to audit the plans to ensure that the plans are in compliance with the NPIP Program Standards.
Two commenters addressed our proposed requirement to have States ensure that biosecurity plans are in place and being followed. First, they suggested voluntary versus mandatory biosecurity plans for flocks in ISRCP due to the lack of resources to enforce such requirements.
Although we understand the limited resources noted by the commenters, as we stated in the proposed rule, the regulations already require that ISRCPs include a minimum biosecurity plan followed by all poultry producers. Our proposed regulatory revisions were to ensure that this existing ISRCP requirement, which has been in effect since 2006, is, in fact, being carried out and producers in the State are in fact following the minimum biosecurity plan. As we noted in the 2006 interim rule that established the requirement (71 FR 56302-56333, Docket No. APHIS-2005-0109), producer biosecurity plans are a necessary component for APHIS to have confidence that a State is fully capable of determining whether H5/H7 LPAI is present in flocks that participate in NPIP within the State and taking action to respond to any outbreaks of LPAI that may occur within the State.
While APHIS is committed to working with Official State Agencies (OSAs) to lessen enforcement burden, the above comments suggest States were not enforcing the requirement. This underscores, rather than undermines, the need for the regulatory revisions in the proposed rule.
One commenter expressed concerns regarding farm auditing of biosecurity plans. The commenter inquired about provisions for situations (
We acknowledge that historically, biosecurity audits for both HPAI and LPAI have been paper-based, and evaluated a producer's biosecurity plans against the biosecurity principles contained in NPIP Program Standard E at least once every two years in order to review documentation and ensure biosecurity compliance. However, while a December 2024 interim rule (89 FR 106981-106996, Docket No. APHIS-2023-0088) revised our HPAI indemnity regulations to require on-premises biosecurity audits for certain producers as a condition of indemnification, APHIS will continue to use paper-based audits within the context of its LPAI indemnity regulations.
APHIS believes that continued use of paper-based audits for LPAI is justified. HPAI, unlike LPAI, is a foreign animal disease with a high mortality rate. Accordingly, the goals for biosecurity plans within the two programs differ. As stated above, within APHIS' LPAI control program, producer biosecurity plans are a necessary component for APHIS to have confidence that a State is fully capable of determining whether H5/H7 LPAI is present in flocks that participate in NPIP within the State and taking action to respond to any outbreaks of LPAI that may occur within the State. Within the context of the HPAI program, biosecurity plans are necessary to ensure that all possible sources of introduction of HPAI onto a premises are addressed and mitigated. The former effort can be conducted through paper-based audits, the latter effort cannot.
As we mentioned above, Program Standard E in the NPIP Program Standards articulates biosecurity principles that are used both within the context of APHIS' HPAI and LPAI control programs. Two commenters stated that the principles in Program Standard E are widely used within NPIP as both the template for producer biosecurity plans and as the baseline for checklists used by OSAs in order to evaluate those plans, and that changes to Program Standard E could have cascading implications.
We understand the commenters' concerns, however, the changes to Program Standard E that we proposed were not to the principles listed in that standard and as such, the commenters' concerns are outside the scope of this rule.
One commenter noted that § 147.48 of the regulations requires APHIS to publish the recommendations of an NPIP Biennial Conference in the
We recognize the commenter's concerns regarding the timeliness of the proposed rule, and will strive to adhere to the 14-month deadline going forward. However, factors outside of the Agency's control can influence publication timelines. For example, the 2022-2024 HPAI outbreak in poultry was the largest animal health emergency in U.S. history and required widespread and prolonged deployment of APHIS personnel with avian health experience.
Lastly, upon review of the proposed rule, we have identified some minor typographical and syntactical errors within its regulatory text. In this rule, we have corrected them to ensure the regulatory text is accurate and reflects Agency intent.
Therefore, for the reasons given, we are adopting the proposed rule as a final rule, with the changes noted above.
This final rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget. Further, because this rule is not significant, it is not a regulatory action under Executive Order 14192.
This rulemaking will result in various changes to regulations in 9 CFR parts 56, and 145 through 147, modifying provisions of the NPIP. The modifications were recommended by the NPIP General Conference Committee (GCC), which represents cooperating State agencies and poultry industry members and advises the Secretary on issues pertaining to poultry health. These amendments will, among other things, condition indemnity for LPAI on adherence to biosecurity plans, clarify existing provisions of the regulations, fix editorial errors, and align the regulations more closely with current producer practices.
The establishments affected by this rulemaking—principally entities engaged in poultry production and processing—are predominantly small by Small Business Administration standards. In those instances in which an addition or modification potentially results in a cost to certain entities, we do not expect the costs to be significant. This rule embodies changes decided upon by the NPIP GCC on behalf of Plan members, that is, changes recognized by the poultry industry as in their interest. We note that NPIP membership is voluntary.
Under these circumstances, the Administrator of the Animal and Plant Health Inspection Service has determined that this action, if promulgated, will not have a significant economic impact on a substantial number of small entities.
This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 2 CFR chapter IV.)
This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule: (1) Preempts all State and local laws and regulations that are in conflict with this rule; (2) has no retroactive effect; and (3) does not require administrative proceedings before parties may file suit in court challenging this rule.
In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this notice, please contact
Pursuant to the Congressional Review Act (5 U.S.C. 801
Animal diseases, Indemnity payments, Low pathogenic avian influenza, Poultry.
Animal diseases, Poultry and poultry products, Reporting and recordkeeping requirements.
Accordingly, we are amending 9 CFR parts 56, 145, 146, and 147 as follows:
7 U.S.C. 8301-8317; 7 CFR 2.22, 2.80, and 371.4.
The addition and revision read as follows:
(a) * * *
(3) Virus elimination (VE) measures taken on premises, conveyances, and materials that came into contact with poultry that were infected with or exposed to H5/H7 LPAI; or, in the case of materials, if the cost of the VE measures would exceed the value of the
(b)
(1)(i) The poultry are from:
(A) A commercial table-egg laying premises with at least 75,000 birds; or
(B) A meat-type chicken slaughter plant that slaughters at least 200,000 meat-type chickens in an operating week; or
(C) A meat-type turkey slaughter plant that slaughters at least 2 million meat-type turkeys in a 12-month period; or
(D) A meat-type game bird and waterfowl slaughter plant that slaughters at least 50,000 birds annually; or
(E) A raised-for-release game bird premises, raised-for-release waterfowl premises, and egg-type game bird or waterfowl producing eggs for human consumption premises that raise at least 25,000 birds annually and have at least 5,000 birds onsite; or
(F) A breeder flock premises with at least 5,000 birds; and
(ii) The breeding flock, commercial flock, or slaughter plant participates in the U.S. Avian Influenza Clean, H5/H7 Avian Influenza Clean, or U.S. H5/H7 Avian Influenza Monitored program of the Plan available to the flock in part 145 or 146 of this chapter; and
(iii) The owner of the poultry or eggs, and, if applicable, any party that enters into a contract with the owner to grow or care for the poultry or eggs, had in place and was following a biosecurity plan that was in compliance with biosecurity principles approved by the Administrator (within the National Poultry Improvement Plan (NPIP) Program Standards, Standard E pertains to Biosecurity Principles) and has been audited by the Official State Agency to ensure that the biosecurity plan is in compliance at the time of detection of H5/H7 LPAI; or
(2) The flock does not meet the size requirements as described in paragraph (b)(1) of this section, regardless of whether the infected or exposed poultry participate in the Plan.
(3) The Administrator is authorized to pay 25 percent of the costs eligible for indemnity and/or compensation, as determined in accordance with § 56.4, of the activities described in paragraphs (a)(1) through (3) of this section, for flocks that:
(i) Do not meet the conditions described in paragraph (b)(1) or (2) of this section; or
(ii) Are located in a State that does not participate in the diagnostic surveillance program for H5/H7 LPAI, as described in § 146.14 of this chapter, or that does not have an initial State response and containment plan for H5/H7 LPAI that is approved by APHIS under § 56.10, unless such poultry participate in the Plan with another State that does participate in the diagnostic surveillance program for H5/H7 LPAI, as described in § 146.14 of this chapter, and has an initial State response and containment plan for H5/H7 LPAI that is approved by APHIS under § 56.10 surveillance program for H5/H7 LPAI, as described in § 146.14 of this chapter, or that does not have an initial State response and containment plan for H5/H7 LPAI that is approved by APHIS under § 56.10, unless such poultry participate in the Plan with another State that does participate in the diagnostic surveillance program for H5/H7 LPAI, as described in § 146.14 of this chapter, and has an initial State response and containment plan for H5/H7 LPAI that is approved by APHIS under § 56.10.
The additions and revision read as follows:
(c) * * *
(1) * * *
(ii) Poultry will be monitored daily for the development of additional and/or increased severity of clinical signs with scheduled flock observation, tracking, and recording flock(s) mortality, taking action as directed by the Official State Agency.
(iv) Routes to slaughter must avoid other commercial poultry operations whenever possible. All load-out equipment, trailers, and trucks used on the premises that have housed poultry that were infected with or exposed to H5/H7 LPAI must undergo virus elimination procedures and not enter other poultry premises or facilities for 48 hours after the virus elimination procedures have been completed.
(a) In order for poultry owners within a State to be eligible for indemnity and/or compensation for 100 percent of eligible costs under § 56.3(b), the State in which the poultry participate in the Plan must have in place an initial State response and containment plan that has been approved by APHIS. The initial State response and containment plan must be developed by the Official State Agency. In States where the Official State Agency is different than the Cooperating State Agency, the Cooperating State Agency must also participate in the development of the initial State response and containment plan. The initial State response and containment plan must be administered by the Cooperating State Agency of the relevant State. This response and containment plan must include:
(1) Provisions for a standing emergency disease management
(2) A biosecurity plan for poultry owners based on their flock size as stated in § 56.3 and, if applicable, any party that enters into a contract with the owner to grow or care for the poultry or eggs that had in place and was following a biosecurity plan that was audited by the Official State Agency to ensure that the biosecurity plan was in compliance according to the Program Standards, Standard E pertaining to the Biosecurity Principles as approved by the Administrator;
(3) Provisions for adequate diagnostic resources;
(4) Detailed, specific procedures for initial handling and investigation of suspected cases of H5/H7 LPAI;
(5) Detailed, specific procedures for reporting test results to APHIS. These procedures must be developed after appropriate consultation with poultry producers in the State and must provide for the reporting only of confirmed cases of H5/H7 LPAI in accordance with § 146.13 of this chapter;
(6) Detailed, strict quarantine measures for presumptive and confirmed index cases;
(7) Provisions for developing flock plans for infected and exposed flocks;
(8) Detailed plans for disposal of infected flocks, including preexisting agreements with regulatory agencies and detailed plans for carcass disposal, disposal sites, and resources for conducting disposal, and detailed plans for disposal of materials that come into contact with poultry infected with or exposed to H5/H7 LPAI;
(9) Detailed plans for cleaning and disinfection of premises, repopulation, and monitoring after repopulation;
(10) Provisions for appropriate control/monitoring zones, contact surveys, and movement restrictions;
(11) Provisions for monitoring activities in control zones;
(12) If vaccination is considered as an option, a written plan for use in place with proper controls and provisions for APHIS approval of any use of vaccine;
(13) Plans for H5/H7 LPAI-negative flocks that provide for quarantine, testing, and controlled marketing; and
(14) Public awareness and education programs regarding avian influenza.
(b) If a State is designated a U.S. Avian Influenza Monitored State, Layers under 146.24 (a) of this chapter or a U.S. Avian Influenza Monitored State, Turkeys under § 146.44(a) of this chapter, it will lose that status during any outbreak of H5/H7 LPAI and for 90 days after the destruction and disposal of all infected or exposed birds and cleaning and disinfection of all affected premises are completed.
7 U.S.C. 8301-8317; 7 CFR 2.22, 2.80, and 371.4.
The revisions and additions read as follows:
The additions read as follows:
(u)
(v)
(w) U.S. Newcastle Disease Clean Compartment. (See §§ 145.45, 145.74, and 145.84.)
The revisions read as follows:
Poultry must be more than 4 months of age when tested for an official classification with the following exceptions: Turkey candidates under subpart D of this part may be tested at more than 12 weeks of age; game bird candidates under subpart E or subpart J of this part may be tested when more than 4 months of age or upon reaching sexual maturity, whichever comes first; and ostrich, emu, rhea, and cassowary candidates under subpart F of this part may be tested when more than 12 months of age. Samples for official tests shall be collected by an Authorized Agent, Authorized Testing Agent, or State Inspector and tested by an authorized laboratory, except that the stained antigen, rapid whole-blood test for pullorum-typhoid may be conducted by an Authorized Testing Agent or State Inspector. Testing must be conducted as specified within the Subpart Plan program, with at least 1 bird tested from each pen and unit in the house and a minimum of 30 birds tested per house. The ratio of samples collected from male and female birds must be representative of birds throughout the house and flock. In houses containing fewer than 30 birds other than ostriches, emus, rheas, and cassowaries, all birds in the house must be tested, unless otherwise specified within the Plan program.
(a) * * *
(6) * * *
(ii) Reactors to the standard tube agglutination test (in dilutions of 1:50 or greater) or the microagglutination test (in dilutions of 1:40 or greater) shall be submitted to an authorized laboratory for bacteriological examination. If there are more than four reactors in a flock, a minimum of four reactors shall be submitted to the authorized laboratory; if the flock has four or fewer reactors, all of the reactors must be submitted. Bacteriological examination must be conducted in accordance with part 147 of this subchapter (within the Program Standards document, Program Standard B addresses bacteriological examination procedures; alternatives to the program standards may also be approved by the Administrator under § 145.73). When reactors are submitted to the authorized laboratory within 10 days of the date of reading an official blood test named in paragraph (a)(6)(i) of this section, and the bacteriological examination fails to demonstrate pullorum-typhoid infection, the Official State Agency shall presume that the flock is determined not to be infected with
The addition reads as follows:
(l) * * *
(1) * * *
(iv) Fifteen (15) birds are tested and found negative for avian influenza within 21 days prior to movement to slaughter regardless of the date of the previous test.
The addition and revisions read as follows:
(c) * * *
(1) A flock maintained in accordance with part 147 of this subchapter with respect to Mycoplasma isolation, sanitation, and management, and in which no
(d) * * *
(1) * * *
(ii) [Reserved]
(h) * * *
(3) * * *
(i) A minimum of 30 birds per flock must test negative using an approved test in § 145.14 at intervals of 90 days or a sample of fewer than 30 birds may be tested, and found negative, at any one time if all pens are equally represented and a total of 30 birds is tested within each 90-day period; and
The addition and revisions read as follows:
(g) * * *
(1) * * *
(v) * * * Owners of flocks shall report the presence or absence of Salmonella in their flocks on a monthly basis to the Official State Agency.
(h) * * *
(3) * * *
(i) A minimum of 30 birds per flock must test negative using an approved test in § 145.14 at intervals of 90 days or a sample of fewer than 30 birds may be tested, and found negative, at any one time if all pens are equally represented and a total of 30 birds is tested within each 90-day period; and
The addition and revisions read as follows:
(f) * * *
(1) * * *
(iv) * * * All
(h) * * *
(3) * * *
(i) A minimum of 30 birds per flock must test negative using an approved test in § 145.14 at intervals of 90 days or a sample of fewer than 30 birds may be tested, and found negative, at any one time if all pens are equally represented and a total of 30 birds is tested within each 90-day period; and
The revision reads as follows:
(e) Under this subpart, gallinaceous flocks and waterfowl flocks may not be raised on the same premises. If they are on the same premises, they must be registered under subpart E of this part.
7 U.S.C. 8301-8317; 7 CFR 2.22, 2.80, and 371.4.
7 U.S.C. 8301-8317; 7 CFR 2.22, 2.80, and 371.4.
(a) * * *
(9) Egg/meat-type game birds and waterfowl.
(f) * * *
(2) All
Federal Aviation Administration (FAA), DOT.
Final rule; correction.
The FAA is correcting an airworthiness directive (AD) that published in the
This correction is effective October 23, 2025. The effective date of AD 2025-18-13 remains October 23, 2025.
The Director of the Federal Register approved the incorporation by reference of a certain publication listed in this AD as of October 23, 2025 (90 FR 44962, September 18, 2025).
• For European Union Aviation Safety Agency (EASA) material identified in this AD, contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; phone: +49 221 8999 000; email:
• You may view this material at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Parkway, Room 6N-321, Fort Worth, TX 76177. For information on the availability of this material at the FAA, call (817) 222-5110. It is also available at
Zain Jamal, Aviation Safety Engineer, FAA, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; phone: (847) 294-7264; email:
Airworthiness Directive 2025-18-13, Amendment 39-23140 (90 FR 44962, September 18, 2025) (AD 2025-18-13), retains the actions required by AD 2020-24-07 and mandates an additional modification, which would constitute terminating action for the repetitive inspections for certain Airbus Helicopters Model AS350B3, EC130B4, and EC130T2 helicopters. This AD also expands the helicopter applicability, provides additional requirements for certain helicopters, and prohibits installing affected microswitches or an affected twist grip with the affected microswitch.
As published, a reference to a measurement specified in the regulatory text of AD 2025-18-13 is incorrect. Paragraph (h)(8) of AD 2025-18-13 defines a discrepancy as a “nut torque that is outside allowable torque limits, or clearance between the support plate assembly and the washers that is not within 01.mm to 0.3 mm”, whereas it should state “nut torque that is outside allowable torque limits, or clearance between the support plate assembly and the washers that is not within 0.1 mm to 0.3 mm”.
No other part of the preamble or regulatory information has been changed; for convenience, the entire rule is being republished.
The effective date of this AD remains October 23, 2025.
The FAA reviewed EASA AD 2023-0187R1, which specifies procedures for modifying the twist grip operational logic on helicopters with MOD 074263 installed. EASA AD 2023-0187R1 also specifies procedures for repetitively inspecting for no marks, residue, or corrosion and testing the “IDLE” and “FLIGHT” controls on the pilot's and copilot's twist grips on helicopters with MOD 074699 installed. Additionally, EASA AD 2023-0187R1 specifies procedures for installing MOD 074782 on helicopters if an affected microswitch is installed, which would constitute terminating action for the
This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, pursuant to the authority delegated to me by the Administrator, the Federal Aviation Administration amends part 39 of the Federal Aviation Regulations (14 CFR part 39) by correcting 90 FR 44962, September 18, 2025, beginning at page 44962, column 1 as follows:
49 U.S.C. 106(g), 40113, 44701.
This airworthiness directive (AD) is effective October 23, 2025.
This AD replaces AD 2020-24-07, Amendment 39-21337 (85 FR 78954, December 8, 2020) (AD 2020-24-07).
This AD applies to Airbus Helicopters Model AS350B3, EC130B4, and EC130T2 helicopters, certificated in any category.
Joint Aircraft System Component (JASC) Code 7600, Engine Controls.
This AD was prompted by reports of the of the engine remaining in idle when the throttle twist grip was turned from the “IDLE” mode to the “FLIGHT” mode. The FAA is issuing this AD to correct the failure of one of the microswitches, 53Ka, 53Kb, or 65K which can prevent the pilot from switching from “IDLE” mode to “FLIGHT” mode during autorotation training making it impossible to recover from a practice autorotation and compelling the pilot to continue the autorotation to the ground. This condition could result in unintended touchdown to the ground at a flight-idle power setting during a practice autorotation, damage to the helicopter, and injury to occupants.
Comply with this AD within the compliance times specified, unless already done.
Except as specified in paragraph (h) of this AD: Comply with all required actions and compliance times specified in, and in accordance with, European Union Aviation Safety Agency AD 2023-0187R1, dated March 20, 2025 (EASA AD 2023-0187R1).
(1) Where EASA AD 2023-0187R1 refers to the effective dates identified in paragraphs (h)(1)(i) through (iii) of this AD, this AD requires using the effective date of this AD.
(i) March 27, 2025 (the effective date of EASA AD 2023-0187R1).
(ii) November 10, 2023 (the effective date of EASA AD 2023-0187, dated October 27, 2023).
(iii) July 19, 2023 (the effective date of EASA AD 2023-0133, dated July 5, 2023).
(2) Where EASA AD 2023-0187R1 refers to April 13, 2017 (the effective date of EASA AD 2017-0059, dated April 6, 2017), this AD requires using January 30, 2019 (the effective date of AD 2018-26-02, Amendment 39-19532 (83 FR 66093, December 26, 2018)).
(3) Where EASA AD 2023-0187R1 refers to flight hours (FH), this AD requires using hours time-in-service.
(4) This AD does not adopt paragraphs (1) and (2) of EASA AD 2023-0187R1.
(5) Instead of complying with the compliance times in Table 1 in paragraph (3) of EASA AD 2023-0187R1, this AD requires the helicopters identified under the Helicopters in Pre-MOD 074699 Configuration column to accomplish the actions required by paragraph (3) of EASA AD 2023-0187R1 before the next practice autorotation, within 100 hours time-in-service, or 6 months after January 12, 2021 (the effective date of AD 2020-24-07), whichever occurs first.
(6) Where Table 2 in paragraph (4), Table 3 in paragraph (7), and Table 4 in paragraph (9) of EASA AD 2023-0187R1 state “For helicopters which operate or have operated in salt-laden atmospheric conditions”, this AD requires replacing that text with “For helicopters which operate or have operated in salt-laden atmospheric conditions, or if it cannot be determined if a helicopter has been operated in salt-laden atmospheric conditions”.
(7) Where paragraph (6) of EASA AD 2023-0187R1 states “discrepancies are detected”, this AD requires replacing that text with “marks, residue, corrosion, flaky varnish are detected; the values of the insulation test are less than 10 megaOhms; the microswitch closes in the “IDLE” position and does not open as soon as the twist grip is turned to the “FLIGHT” position; or the microswitch is open in the “FLIGHT” position and does not close as soon as the twist grip is turned to the “IDLE” position”.
(8) Where paragraph (9) of EASA AD 2023-0187R1 states “any discrepancy,” for purposes of this AD, discrepancy is defined as a nut torque that is outside allowable torque limits, or clearance between the support plate assembly and the washers that is not within 0.1 mm to 0.3 mm.
(9) This AD does not adopt the “Remarks” section of EASA AD 2023-0187R1.
(1) The Manager, International Validation Branch, 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 International Validation Branch, send it to the attention of the person identified in paragraph (j) of this AD and email to:
(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.
For more information about this AD, contact Zain Jamal, Aviation Safety Engineer, FAA, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; phone: (847) 294-7264; email:
(1) The Director of the Federal Register approved the incorporation by reference of the material listed in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
(2) You must use this material as applicable to do the actions required by this AD, unless the AD specifies otherwise.
(i) European Union Aviation Safety Agency (EASA) AD 2023-0187R1, dated March 20, 2025.
(ii) [Reserved]
(3) For EASA material identified in this AD, contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; phone: +49 221 8999 000; email:
(4) You may view this material at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Parkway, Room 6N-321, Fort Worth, TX 76177. For information on the availability of this material at the FAA, call (817) 222-5110.
(5) You may view this material at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, visit
Federal Aviation Administration (FAA), DOT.
Final rule.
This action modifies the Class E airspace area designated as a surface area, modifies the Class E airspace area designated as an extension to a Class E surface area, and modifies the Class E airspace areas extending upward from 700 feet or more above the surface of the earth at Battle Mountain Airport, Battle Mountain, NV. This action also updates the administrative portions of the airport's legal descriptions. These actions support the safety and management of instrument flight rules (IFR) operations at the airport.
Effective date 0901 UTC, January 22, 2026. The Director of the Federal Register approves this incorporation by reference action under 1 CFR part 51, subject to the annual revision of FAA Order JO 7400.11 and publication of conforming amendments.
A copy of the notice of proposed rulemaking (NPRM), supplemental notice of proposed rulemaking (SNPRM), all comments received, this final rule, and all background material may be viewed online at
FAA Order JO 7400.11K,
Nathan A. Chaffman, Federal Aviation Administration, Western Service Center, Operations Support Group, 2200 S 216th Street, Des Moines, WA 98198; telephone (206) 231-3460.
The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it modifies Class E airspace to support IFR operations at Battle Mountain Airport, Battle Mountain, NV.
The FAA published an NPRM for Docket No. FAA-2024-2099 in the
After publication of the NPRM, it was discovered that the Class E airspace designated as an extension to a Class E surface area at Battle Mountain Airport, Battle Mountain, NV, had previously been established within the final rule of Docket No. FAA-2019-0786 in the
The FAA has since identified an error within the SNPRM (90 FR 21249; May 19, 2025) concerning the proposed legal description for Battle Mountain's Class E airspace designated as an extension to a Class E surface area. The legal description excluded “that airspace within the Battle Mountain Airport Class E2.” FAA Order JO 7400.2R,
Class E2, E4, and E5 airspace areas are published in paragraphs 6002, 6004, and 6005, respectively, of FAA Order JO 7400.11,
The FAA is amending 14 CFR part 71 by modifying the Class E airspace area designated as surface area, modifying the Class E airspace area designated as an extension to a Class E surface area, modifying the Class E airspace extending upward from 700 feet above the surface of the earth, and removing the Class E airspace extending upward from 1,200 feet above the surface at Battle Mountain Airport, Battle Mountain, NV.
The Class E airspace area designated as surface area is expanded from a 4.2-mile radius to a 4.4-mile radius and a 0.1-mile extension is added to the southwest of the airport to more appropriately contain departing IFR aircraft executing the Runway (RWY) 22 obstacle departure procedure while between the surface and the base of adjacent controlled airspace.
Class E airspace designated as an extension to a Class E surface area is realigned to the 221° bearing and expanded to contain arriving IFR aircraft on the very high frequency omnidirectional range (VOR) RWY 4
Moreover, the Class E airspace extending upward from 700 feet above the surface is expanded to a 5-mile radius through all but the northwest portion to better contain arriving IFR aircraft operating below 1,500 feet and departing IFR aircraft until reaching 1,200 feet above the surface. The northeast extension is realigned to the airport's 051° bearing and is expanded to more appropriately contain arriving IFR aircraft below 1,500 feet above the surface while executing the Area Navigation (RNAV) (Global Positioning System [GPS]) RWY 22 approach procedure. The southwest extension is reduced approximately 5 miles to better contain arriving IFR aircraft operating below 1,500 feet above the surface while executing the VOR RWY 4 or RNAV (GPS) RWY 4 approach procedures, departing IFR aircraft while executing the RNAV (GPS) RWY 13 or RNAV (GPS) RWY 33 departure procedures, and IFR aircraft ascending via the RNAV (GPS) RWY 22 missed approach procedure until reaching 1,200 feet above the surface. The northwest portion of the central radius is reduced in size to more appropriately contain IFR aircraft departing RWY 31 until reaching 1,200 feet above the surface.
Furthermore, the Battle Mountain Class E airspace beginning at 1,200 feet above the surface is removed as it is redundant. The Battle Mountain and Rome Class E6 airspace areas provide sufficient containment of transitional operations.
Finally, the administrative portion of the airport's legal description is updated. Reference to the Battle Mountain very high frequency omnidirectional range tactical air navigation (VORTAC) on line three of the Class E5 legal description is no longer needed and is removed. The airspace is now described using only the airport reference point.
The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore: (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); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1G,
Airspace, Incorporation by reference, Navigation (air).
In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:
49 U.S.C. 106(f), 106(g), 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.
That airspace extending upward from the surface within a 4.4-mile radius of the airport and within 1.8 miles southeast and 1.9 miles northwest of the 228° bearing extending from the 4.4-mile radius to 4.5 miles southwest of the airport.
That airspace extending upward from the surface within 2.9 miles southeast and 3.4 miles northwest of the 221° bearing extending from the airport's 4.4-mile radius to 10.4 miles southwest of the airport.
That airspace extending upward from 700 feet above the surface within a 5-mile radius of the airport, within 4.9 miles northwest and 1.9 miles southeast of the 051° bearing extending from the 5-mile radius to 11.1 miles northeast of the airport, within 3.5 miles southeast and 3.6 miles northwest of the 221° bearing extending from the 5-mile radius to 11.5 miles southwest of the airport, within 1.8 miles either side of the 319° bearing extending from the 5-mile radius to 6.7 miles northwest of the airport, and within a 5.5-mile radius clockwise from the 319° bearing to the 349° bearing from the airport.
Office of the Secretary of Transportation (OST), U.S. Department of Transportation.
Notification of enforcement discretion.
This document announces that the U.S. Department of Transportation (DOT) is delaying enforcement of certain provisions of the final rule on “Ensuring Safe Accommodations for Air Travelers With Disabilities Using Wheelchairs” (Wheelchair Rule) while it engages in a
As of September 30, 2025, enforcement of 14 CFR 382.125(e), 382.130(a), 382.132, and 382.141(a)(6) contained in the Wheelchair Rule, published on December 17, 2024, at 89 FR 102398, is delayed until December 31, 2026.
This notification of enforcement discretion, the notice of proposed rulemaking (NPRM), all comments received, the final rule, and all background material may be viewed online at
Tori Ford, Vinh Nguyen, or Blane Workie, Office of Aviation Consumer Protection, U.S. Department of Transportation, 1200 New Jersey Ave. SE, Washington, DC 20590, 202-366-9342 (phone), 202-366-7152 (fax),
On December 17, 2024, DOT issued a final rule on “Ensuring Safe Accommodations for Air Travelers With Disabilities Using Wheelchairs” (Wheelchair Rule).
DOT previously announced that it would exercise its enforcement discretion and not enforce the Wheelchair Rule until March 20, 2025.
The Department has now initiated a new rulemaking titled “Airline Obligations to Accommodate Air Travelers with Disabilities Using Wheelchairs” (Wheelchair Rule II).
DOT has announced a target date of August 2026 for issuance of a notice of proposed rulemaking (NPRM) for Wheelchair Rule II.
Issued in Washington, DC, under authority delegated in 49 CFR 1.27(a).
Federal Energy Regulatory Commission.
Final rule.
The Commission is issuing this final rule to transfer certain delegated authority from the Director of the Commission's Office of Energy Market Regulation to the Director of the Commission's Office of Electric Reliability, with respect to uncontested Electric Reliability Organization (ERO) or Regional Entity filings pertaining to ERO delegation agreements and ERO or Regional Entity rules or rule changes.
This final rule is effective September 30, 2025.
Hampden T. Macbeth, Office of General Counsel, Federal Energy Regulatory Commission, 888 First Street NE, Washington, DC 20426. (202) 502-8957.
1. The Energy Policy Act of 2005 added section 215 to the Federal Power Act (FPA), which requires a Commission-certified Electric Reliability Organization (ERO) to develop mandatory and enforceable Reliability Standards for the Bulk-Power System, subject to Commission review and approval.
2. In Order No. 672, the Commission,
3. Section 39.8 of the Commission's regulations requires the ERO to submit to the Commission for Commission approval any proposal to delegate the ERO's authority to a Regional Entity for the purpose of proposing and enforcing Reliability Standards.
4. Section 39.10 of the Commission's regulations requires the ERO to file with the Commission for Commission approval any proposed organization rule or rule change, including any Regional Entity rule or rule change.
5. In light of the Office of Electric Reliability's (OER) frequent interactions with the ERO and OER's applicable expertise, certain authorities related to ERO filings made pursuant to sections 39.8 and 39.10 of the Commission's regulations that are currently delegated to the Director of the Office of Energy Market Regulation (OEMR) are being transferred to the Director of OER.
6. Office of Management and Budget (OMB) regulations require OMB to approve certain information collection requirements imposed by agency rule.
7. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement for any action that may have a significant adverse effect on the human environment.
8. The Regulatory Flexibility Act of 1980 (RFA)
9. Executive Order 12866 (Regulatory Planning and Review), as amended by Executive Orders 14215 (Ensuring Accountability for All Agencies) and 13563 (Improving Regulation and Regulatory Review), directs agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. This final rule regards “agency organization, management, or personnel matters” and is not subject to regulatory planning and review pursuant to section 3(d)(3) of Executive Order 12866.
10. Executive Order 13132 (Federalism) imposes certain requirements on Federal agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. The Executive Order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and to carefully assess the necessity for such actions. The Commission has determined that this final rule would not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, the Commission has not prepared a federalism assessment.
11. In addition to publishing the full text of this document in the
12. From the Commission's Home Page on the internet, this information is available on eLibrary. The full text of
13. User assistance is available for eLibrary and the Commission's website during normal business hours from FERC Online Support at (202) 502-6652 (toll free at (866) 208-3676) or email at
14. The Commission is issuing this rule as an instant final rule without a period for public comment. These regulations are effective on September 30, 2025. The Commission finds that notice and public comments are unnecessary because this final rule concerns only internal agency procedure and practice. Therefore, the Commission finds good cause to waive the notice period otherwise required before the effective date of this final rule.
Authority delegations (Government agencies), Seals and insignia, Sunshine Act.
By direction of the Commission.
In consideration of the foregoing, the Commission amends part 375, chapter I, title 18,
5 U.S.C. 551-557; 15 U.S.C. 717-717w, 3301-3432; 16 U.S.C. 791-825r, 2601-2645; 42 U.S.C. 7101-7352.
National Indian Gaming Commission.
Direct final rule.
For the purposes of gaming ordinance or amendment submissions, the National Indian Gaming Commission is removing the requirement for a tribe to submit a copy of its procedures for resolving disputes between the gaming public and the tribe or the management contractor.
This direct final rule is effective December 1, 2025, unless significant adverse comments are received by October 30, 2025. If this direct final rule is withdrawn because of such comments, timely notice of the withdrawal will be published in the
National Indian Gaming Commission, 1849 C Street NW, Mail Stop 1621, Washington, DC 20240.
Jo-Ann M. Shyloski at 202-632-7003 or write to
Congress enacted the Indian Gaming Regulatory Act (IGRA), 25 U.S.C. 2701
Presidential Executive Order 14219, entitled
In the spirit of Executive Order 14219 and the Presidential Memorandum, the Commission removes the requirement for tribes to submit a copy of its procedures for resolving disputes with the gaming public and the tribe or management contractor, because IGRA contains no directive about such procedures for ordinances. All but one of the other submission requirements relate to IGRA's mandatory content for ordinances: criminal history check, background investigation, and licensing procedures; approved tribal-state compacts or Class III procedures (for approval of Class III ordinances); and environmental and public health and safety documents. 25 U.S.C. 2710(b)(2)(E) and (F), (d)(1)(A)(ii) and (2)(A); 25 CFR 522.2 (b)-(d), (g) & (h). The sole outlier is a copy of the tribe's designation of an agent for service, but that corresponds with IGRA's empowerment of the NIGC Chair to issue complaints against tribal operators and management contractors as well as levy civil fines and/or temporary closure orders for violations of the Act, its implementing regulations, or tribal ordinances. 25 U.S.C. 2713(a)(1) and (3), (b). If the Chair takes such actions, a tribe's authorized representative or agent must receive them expeditiously to enable the tribe to appeal the Chair's decisions to the full Commission and/or request a hearing before the full Commission about them. Both the appeals to the Commission and hearings before it are explicitly permitted by IGRA. 25 U.S.C. 2713(a)(2), (b)(2).
Executive Order 12866, as reaffirmed by Executive Order 13563, provides that the Office of Management and Budget's (OMB's) Office of Information and Regulatory Affairs (OIRA) will review all rules to determine if they are
The APA permits agencies to finalize some rules without first publishing a proposed rule in the
The rule will not have a significant impact on a substantial number of small entities as defined under the Regulatory Flexibility Act, 5 U.S.C. 601,
The rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. The rule does not have an effect on the economy of $100 million or more. The rule will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, local government agencies or geographic regions, nor will the proposed rule have a significant adverse effect on competition, employment, investment, productivity, innovation, or the ability of the enterprises, to compete with foreign based enterprises.
The Commission, as an independent regulatory agency, is exempt from compliance with the Unfunded Mandates Reform Act, 2 U.S.C. 1502(1); 2 U.S.C. 658(1).
In accordance with Executive Order 12630, the Commission has determined that the rule does not have significant takings implications. A takings implication assessment is not required.
In accordance with Executive Order 12988, the Commission has determined that the rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Order.
The Commission has determined that the rule does not constitute a major federal action significantly affecting the quality of the human environment and that no detailed statement is required pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. 4321,
The information collection requirements contained in this rule were previously approved by the Office of Management and Budget (OMB) as required by 44 U.S.C. 3501,
The National Indian Gaming Commission is committed to fulfilling its tribal consultation obligations—whether directed by statute or administrative action such as Executive Order (E.O.) 13175 (Consultation and Coordination with Indian Tribal Governments)—by adhering to the consultation framework described in its relatively new Consultation Policy, adopted October 31, 2022. The NIGC's consultation policy specifies that it will consult with tribes on Commission Action with Tribal Implications, which is defined as: Any Commission regulation, rulemaking, policy, guidance, legislative proposal, or operational activity that may have a substantial direct effect on an Indian tribe on matters including, but not limited to the ability of an Indian tribe to regulate its Indian gaming; an Indian tribe's formal relationship with the Commission; or the consideration of the Commission's trust responsibilities to Indian tribes.
Because the Commission is abolishing the requirement to submit a copy of dispute resolution procedures with an ordinance or an amendment for the Chair's approval, controversy over this change and/or adverse comments are unlikely. Accordingly, the Commission proceeds with the issuance of this direct final rule.
Gambling, Indian—lands, Indian—tribal government, Reporting and recordkeeping requirements.
For the reasons discussed in the preamble, the Commission amends 25 CFR part 522 as follows:
25 U.S.C. 2706, 2710, 2712.
A tribe must submit to the Chair via electronic or physical mail all of the following information with a request for approval of a class II or class III ordinance or resolution, or amendment thereto:
(a) One copy of an ordinance or resolution certified as authentic by an authorized tribal official that meets the approval requirements in § 522.5(b) or § 522.7.
(b) A copy of the procedures to conduct or cause to be conducted background investigations on key employees and primary management officials and to ensure that key employees and primary management officials are notified of their rights under the Privacy Act as specified in § 556.2 of this chapter;
(c) A copy of the procedures to issue tribal licenses to primary management officials and key employees promulgated in accordance with § 558.3 of this chapter;
(d) When an ordinance or resolution concerns class III gaming, a copy of any approved tribal-state compact or class III procedures as prescribed by the Secretary that are in effect at the time the ordinance or amendment is passed;
(e) A copy of the designation of an agent for service under § 519.1 of this chapter; and
(f) Identification of the entity that will take fingerprints and a copy of the procedures for conducting a criminal history check. Such a criminal history check shall include a check of criminal history records information maintained by the Federal Bureau of Investigation.
(g) A tribe shall provide Indian lands or tribal gaming regulations or environmental and public health and safety documentation that the Chair may request in the Chair's discretion. The tribe shall have 30 days from receipt of a request for additional documentation to respond.
(b) * * *
(2) Any submission under § 522.2(b) through (g) that has been modified since its prior conveyance to the Chair for an ordinance, resolution, or amendment approval; and
Internal Revenue Service (IRS), Treasury.
Final regulations and removal of temporary regulations.
This document contains final regulations setting forth recordkeeping and reporting requirements for the average income test for purposes of the low-income housing credit. If a building is part of a residential rental project that satisfies the average income test, the building may be eligible to earn low-income housing credits. These final regulations affect owners of low-income housing projects, State or local housing credit agencies that monitor compliance with the requirements for low-income housing credits, and, indirectly, tenants in low-income housing projects.
Waheed Olayan at (202) 317-4137 (not a toll-free number).
This document contains amendments to the Income Tax Regulations (26 CFR part 1) under section 42 of the Internal Revenue Code (Code) relating to recordkeeping and reporting requirements for the average income test for purposes of the low-income housing credit (final regulations). The final regulations are issued under the authority granted to the Secretary of the Treasury or the Secretary's delegate (Secretary) in sections 42(n) and 7805(a) of the Code.
Section 42(n) provides, in part, “The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of [section 42] . . .”
Section 7805(a) provides, “[T]he Secretary shall prescribe all needful rules and regulations for the enforcement of [the Code], including all rules and regulations as may be necessary by reason of any alteration of law in relation to internal revenue.”
The Tax Reform Act of 1986, Public Law 99-514, 100 Stat. 2085 (1986 Act) created the low-income housing credit under section 42. Section 42(a) provides that the amount of the low-income housing credit for any taxable year in the credit period is an amount equal to the applicable percentage (effectively, a credit rate) of the qualified basis of each qualified low-income building.
Section 42(c)(1)(A) provides that the “qualified basis” of any qualified low-income building for any taxable year is an amount equal to: (i) the applicable fraction, determined as of the close of the taxable year, multiplied by (ii) the eligible basis of the building (determined under section 42(d)).
Section 42(c)(1)(B) defines the term “applicable fraction” as the smaller of the unit fraction or floor space fraction. The unit fraction is the number of low-income units in the building divided by the number of residential rental units (whether or not occupied) in the building. The floor space fraction is the total floor space of low-income units in the building divided by the total floor space of residential rental units (whether or not occupied) in the building.
Subject to certain exceptions in section 42(i)(3)(B), section 42(i)(3) defines the term “low-income unit” as any unit in a building if the unit is rent-restricted and the individuals occupying the unit meet the income limitation under section 42(g)(1) that applies to the project of which the building is a part.
Section 42(d)(1) and (2) describe how to calculate the eligible basis of a new building or an existing building, respectively.
Section 42(c)(2) defines the term “qualified low-income building” as any building which is part of a qualified low-income housing project at all times during the compliance period (as defined in section 42(i)(1), the period of 15 taxable years beginning with the first taxable year of the credit period).
For a project to qualify as a low-income housing project, it must satisfy one of the section 42(g) minimum set-aside tests, as elected by the taxpayer. Prior to the enactment of the Consolidated Appropriations Act of 2018, Public Law 115-141, 132 Stat. 348 (2018 Act), section 42(g) contained two minimum set-aside tests, known as the 20-50 test and the 40-60 test. Under the 20-50 test, an electing taxpayer cannot earn any low-income housing credits unless at least 20 percent of the residential units in the project both are rent-restricted and are occupied by tenants whose gross income is 50 percent or less of the area median gross income (AMGI). Under the 40-60 test, an electing taxpayer cannot earn any low-income housing credits unless at least 40 percent of the residential units in the project both are rent-restricted and are occupied by tenants whose gross income is 60 percent or less of AMGI.
The 2018 Act added section 42(g)(1)(C), which gives taxpayers a third option for their election of a minimum set-aside test—the average income test. Under the average income test, an electing taxpayer cannot earn any low-income housing credits unless—(i) 40 percent
Special rules in section 42(g)(1)(C)(ii)(I) through (III) govern the income limitations of low-income units as well as the role of those limitations in the average income test. Under the 20-50 and 40-60 tests, the income limitations for all low-income units flow automatically from the taxpayer's election of one of those two set-side tests. In contrast, under the average income test, the electing taxpayer must designate each unit's imputed income limitation, which will then be taken into account in applying the test. In addition, section 42(g)(1)(C)(ii)(III) requires the imputed income limitation designated for any unit to be 20, 30, 40, 50, 60, 70, or 80 percent of AMGI.
Under section 42(g), once a taxpayer elects to use a particular set-aside test for a project, that election is irrevocable. Thus, once a taxpayer has elected to use any of the three tests, the taxpayer may not subsequently elect to use one of the others. Although a taxpayer may have elected the 20-40 or 40-60 test before the average income test became available, the later availability of the average income test does not affect the irrevocability of the earlier election.
Under section 42(m)(1), every State or local housing credit agency (Agency) making allocations of the ability to earn low-income housing credits must have a qualified allocation plan (QAP) to guide it in making those allocations.
Under section 42(m)(1)(B)(iii), a QAP must also contain a procedure that the Agency (or its agent) will follow in monitoring noncompliance with low-income housing credit requirements and in notifying the IRS of any such noncompliance. See § 1.42-5 of the Income Tax Regulations for rules implementing this requirement.
Section 1.42-5(e)(2) provides that a QAP must require an Agency to provide prompt written notice to the owner of a low-income housing project if the Agency does not receive the certification described in § 1.42-5(c)(1), or does not receive, or is not permitted to inspect, the tenant income certifications, supporting documentation, and rent records described in § 1.42-5(c)(2)(ii), or discovers by inspection, review, or in some other manner, that the project is not in compliance with the provisions of section 42.
Section 1.42-5(e)(4) both sets the correction period after an Agency has notified an owner under § 1.42-5(e)(2) and provides that the correction period shall be that period specified in the monitoring procedure during which an owner must supply any missing certifications and bring the project into compliance with the provisions of section 42. The correction period is not to exceed 90 days from the date of the notice to the owner described in § 1.42-5(e)(2). An Agency may extend the correction period for up to 6 months, but only if the Agency determines there is good cause for granting the extension.
On October 30, 2020, the Department of Treasury (Treasury Department) and the IRS published a notice of proposed rulemaking (REG-119890-18) in the
The possibility of a “cliff” (as described in following two paragraphs) was one of the main concerns that commenters expressed regarding the 2020 proposed regulations. Almost all projects earning low-income housing credits have more than the minimum number of low-income units needed for the project to qualify for the credits. Thus, with the 20-50 or 40-60 tests, a later discovery that some unit failed to be a low-income unit generally would reduce the amount of credit earned but would not totally preclude a project's eligibility.
By contrast, in response to the 2020 proposed regulations, commenters were concerned about the following possibility with respect to the average income test: Suppose that a taxpayer identified well over 40 percent of units whose income limits averaged exactly 60 percent of AMGI, and further suppose that one of the units with the lowest income limit turned out to fail the criteria for being a low-income unit. In that case, the remaining units identified by the taxpayer would have an average income above 60 percent. The commenters were concerned that, in this situation and except for time-limited mitigation measures described in the 2020 proposed regulations, the 2020 proposed regulations would apply the average income test to
On October 12, 2022, the Treasury Department and the IRS published average-income-test final regulations (TD 9967) in the
Under the 2022 final regulations, a project for residential rental property meets the requirements of the average income test if the taxpayer's project contains a qualified group of units that constitutes 40 percent
The Treasury Department and the IRS expected that commenters' concerns would be fully assuaged by the qualified group approach in the 2022 final regulations, as implemented with the flexibility in the temporary regulations.
In the same issue of the
Four public comments were submitted in response to the 2022 proposed regulations. The comments are available for public inspection at
The Treasury Department and the IRS considered all comments in the development of this Treasury decision, which follows the basic framework of the 2022 proposed and temporary regulations, with some revisions. The following Summary of Comments and Explanation of Revisions discusses the comments received and the revisions adopted.
In addition, the final regulations include some minor, non-substantive revisions to the 2022 proposed regulations that are not discussed in the Summary of Comments and Explanation of Revisions.
These final regulations provide recordkeeping and reporting requirements for the average income test under section 42(g)(1)(C).
As with the 2020 proposed regulations, commenters expressed concern that the temporary regulations (and thus the 2022 proposed regulations) might be interpreted as again creating such a cliff effect in circumstances where a taxpayer identified well over 40 percent of units whose income limits averaged exactly 60 percent of AMGI. The commenters stated that the temporary regulations could be interpretated as meaning that a post-year-end discovery that one of the units with the lowest income limit failed the criteria for being a low-income unit could cause an entire project to lose eligibility to earn low-income housing credits. Specifically, if the later-discovered noncompliant unit was in the qualified group of units reported to the Agency to demonstrate compliance with the average income test, then excluding that unit's (below-60 percent of AMGI) income limit would cause the average of the remaining units in the identified group to exceed 60 percent of AMGI. Commenters also raised the possibility that the reported qualified group might contain exactly 40 percent of the units in the project, even though other units were available to include in the reported qualified group. In that case, removing the now-disqualified unit would reduce the qualified group of units to less than 40 percent of the project's total units.
In such cases, commenters suggested that the taxpayer could have taken steps to preserve the qualification of the project if the regulations allowed other units to be substituted in the qualified group that is used to satisfy the requirements of the average income test. Some of the comment letters proposed revising § 1.42-19T(c)(4), regarding an Agency's waiver authority, to expressly allow a taxpayer to submit a corrected group of qualified units.
The 2022 final regulations were intended to eliminate the risk of a cliff. Consistent with that intention, the temporary regulations were not intended to cause disqualification because of a post-year-end discovery that one of the identified units failed the criteria for being a low-income unit in circumstances where the taxpayer could have identified a different group of qualified units. The purpose of the recordkeeping and reporting rules for the average income test is similar to the rules for the other set-aside tests. Thus, the rules in the temporary regulations are intended to create a contemporaneous record of the qualified groups of units. This record helps document and later verify that the taxpayer met the requirements of the average income test and correctly calculated the applicable fraction of the building.
The Treasury Department and the IRS agree with commenters that the final regulations should more clearly allow the submission of a corrected qualified group when the taxpayer or Agency realizes that a previously submitted group fails to be a qualified group. For example, suppose that a unit with a 40 percent imputed income designation is included in a reported qualified group but is later determined to have been noncompliant during the relevant time period. In such a case, submitting a revised qualified group can document both the removal of that noncompliant unit and any removal of other units. For example, simultaneously removing the noncompliant unit and one or more higher-limitation units may be needed to reduce the average imputed income designations of units in the identified group down to 60 percent or less of AMGI. This updated reporting requirement will be helpful for demonstrating that the average income test was met as of the prior year end. It will also be useful for identifying more clearly the qualified group of units to be used for calculating the applicable fraction.
Accordingly, these final regulations adopt the commenters' suggestion to permit the submission of a corrected qualified group of units. The Treasury Department and the IRS note that allowing submission of a revised qualified group does not allow a taxpayer retroactively to change income designations for any unit in a building after a taxable year has closed. A change in an income designation is not allowed even if a tenant's income would have supported a lower designation prior to year end.
Proposed § 1.42-19(c)(1)(ii) would require taxpayers to report two separate groups of qualified units: (i) one for the minimum set-aside test; and (ii) one for computing the applicable fractions of buildings in the project. Some commenters suggested that reporting two separate groups of qualified units is unnecessary because a single list of all units submitted for determining the applicable fraction would include the information needed to determine whether the minimum set-aside is met. Under the definition of qualified group, the designations of the low-income units in the applicable-fraction qualified group must average 60 percent or less of AMGI. Thus, if that group includes at least 40 percent of the units in the project, that group of units is a qualified group that satisfies the average-income set-aside.
The commenters recommended that the final regulations streamline the reporting process to allow a taxpayer to report to the Agency a single qualified group of low-income units that is large enough to include at least 40 percent of the residential units in the project. This qualified group of units demonstrates compliance with the set aside, and data on the units in each building represented in the group is available to compute the applicable fraction(s) for each such building.
Section 1.42-19(c) of the 2022 proposed regulations would give Agencies flexibility to determine the best time and manner for taxpayers to communicate the required information so that each Agency can adopt a system that best serves that particular Agency. This flexibility is intended to enable the Agency to minimize burden on the Agency and taxpayers.
The Treasury Department and the IRS agree with commenters that one list can be sufficient. However, it is important to maintain flexibility for any Agency that finds two separate lists helpful. Thus, the final regulations revise the language in the 2022 proposed regulations to provide that Agencies have discretion to permit taxpayers to report either one or two qualified groups of low-income units. The final regulations also include examples illustrating the application of this rule.
Proposed § 1.42-19(c)(4) would provide Agencies with the discretion, on a case-by-case basis, to waive in writing any failure to comply with the proposed regulations' recordkeeping and reporting requirements. The waiver may be granted up to 180 days after discovery of the failure, whether by the taxpayer or Agency.
One commenter was concerned that 180 days may be insufficient to address a failure, especially if the waiver discretion is being used to remedy the “cliff test” reporting issue described earlier. This commenter recommended revising the final regulations so that the 180-day period starts with the determination of a designation or
The Treasury Department and the IRS considered these recommendations, and the final regulations adopt a revised version of the 2022 proposed regulations. These revisions align the § 1.42-19 reporting requirements with the rules in § 1.42-5. The modification in § 1.42-19(c)(4) is also necessary because the final regulations now allow owners of low-income housing projects to submit a corrected list upon discovery of a problem with a previously submitted list, whether the discovery is by the taxpayer or Agency.
The final regulations in § 1.42-19(c)(4) provide that a failure to comply with the procedural requirements of § 1.42-19(c)(1), (c)(2), or (c)(3)(iv) is treated as corrected in three situations: (i) if a taxpayer discovers the failure to comply, the taxpayer has up to 180 days after discovery of the failure to give the Agency a revised submission, such as a revised qualified group of units; (ii) if an Agency discovers a failure to comply, the Agency should provide prompt notification in a manner similar to § 1.42-5(e)(2), and then the taxpayer must satisfactorily address the failure within the correction period of § 1.42-5(e)(4); or (iii) in all cases, an Agency has discretion to waive in writing any failure to comply with the procedural requirements of § 1.42-19(c)(1), (c)(2), or (c)(3)(iv). This waiver must occur within the applicable time period (dependent on whether a taxpayer or Agency discovered failure). As indicated in the preceding paragraph, the final regulations distinguish noncompliance discovered by an Agency and noncompliance discovered by a taxpayer. In the case of a taxpayer discovery, providing the taxpayer with 180 days after discovery to give the Agency a revised submission should provide sufficient time for taxpayers to comply, because the period does not begin before taxpayers have knowledge, or an appreciation, that there is, indeed, a failure.
In contrast, when an Agency discovers the failure, the final regulations align with the rules that apply to an Agency discovery under § 1.42-5. The Agency must provide prompt notice under § 1.42-5(e)(2) to start the correction period in § 1.42-5(e)(4). Aligning the § 1.42-19 rules with the notice provision in § 1.42-5(e)(2) and the correction period provided by § 1.42-5(e)(4) places taxpayers and Agencies in the same position with an Agency-discovered average income issue as the taxpayer is in when the Agency discovered that otherwise failed to certify under § 1.42-5, or when the Agency discovered any other noncompliance. The final regulations do not adopt commenters' suggestion to start the correction period after a “determination” by the Agency. Under that suggestion, determination means the issuance of a Form 8823 as detailed in § 1.42-5(e)(3). Adopting such a late deadline would misalign these rules with the rules in § 1.42-5. For example, when an Agency “discovers” that a project is not in compliance with the provisions of section 42, § 1.42-5(e)(2) requires the Agency to provide prompt written notice to start the correction period in § 1.42-5(e)(4). If, instead, a “determination” were required for an Agency-discovered error regarding average-income, then the permitted correction period would extend past the date of the correction period for other Agency-discovered errors or failed certifications under § 1.42-5(e)(4) (such as correcting the physical noncompliance of a unit). The burden on the taxpayer in this situation (submitting a corrected list of units) does not justify a longer or different period of time than other Agency-identified issues.
The temporary regulations are removed effective September 30, 2025.
These final regulations are not subject to review under section 6(b) of Executive Order 12866 pursuant to the Memorandum of Agreement (July 4, 2025) between the Treasury Department and the Office of Management and Budget regarding review of tax regulations.
The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) (PRA) requires that a Federal agency obtain the approval of OMB before collecting information from the public, whether such collection of information is mandatory, voluntary, or required to obtain or retain a benefit. The collections of information contained in these regulations has been approved by OMB under control number 1545-0988.
Section 1.42-19(c)(1) provides recordkeeping and reporting requirements related to the identification of a qualified group of units for each of (i) satisfaction of the average income set-aside test and (ii) applicable fraction determinations. Section 1.42-19(c)(2) provides reporting requirements to the Agency with jurisdiction over a project. Section 1.42-19(c)(3)(iv) provides recordkeeping and reporting requirements related to designations of the imputed income limitations for residential units. Section 1.42-19(d)(2) provides recordkeeping and reporting requirements related to changing a unit's designated imputed income limitation.
This information in the collections of information will generally be used by the IRS and Agencies for tax compliance purposes and by taxpayers to facilitate proper reporting and compliance. Specifically, the collections of information in § 1.42-19 apply to owners of projects that receive the low-income housing credit and elect the average income set-aside. With respect to the recordkeeping requirements in § 1.42-19(c)(3)(iv), and (d)(2), section 42(g)(1)(C)(ii)(I) requires that the taxpayer designate the imputed income limitations of the units taken into account for purposes of the average income test. Thus, the recordkeeping requirements that are provided allow for a process of designation that will result in a reliable record of both the original designations of the imputed income limitations of low-income units and any redesignations of units' limitations within a project.
The recordkeeping rules in § 1.42-19(c)(1) with respect to a qualified group of units are similarly needed to ensure there is a reliable record to show that the units used for purposes of the average income set-aside test and for determining a building's applicable fraction were part of a group of units within the project whose average designated imputed income limitations do not exceed 60 percent of AMGI. This limitation is consistent with the requirement in section 42(g)(1)(C)(ii)(II). The annual reporting requirements in § 1.42-19(c)(1), (c)(3), and (d)(2) are also similar in substance to other annual certifications required of taxpayers. For example, minimum certifications by owners are required in qualified allocation plans as provided in § 1.42-5(c). The reporting requirements in these final regulations also provide added flexibility by allowing the applicable Agency to determine the time
A summary of paperwork burden estimates follows:
Taxpayers are also required to report redesignation of units, and why they are required to redesignate units during the year. For purposes of this analysis, we assume that an average of 4 units per building will be redesignated annually. We estimate each redesignation will take an average of 10 minutes. Thus, we estimate the average number of minutes per year to record redesignations for an impacted taxpayers to be 40 minutes per building for a total average annual burden of 2,000 hours (40 minutes × 3,000 buildings).
In addition, we estimate an annual reporting burden related to the expanded flexibility rules to average 20 minutes per impacted taxpayers for a total burden of 100 hours (20 minutes × 300 taxpayers).
A Federal agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.
Pursuant to the Regulatory Flexibility Act (RFA) (5 U.S.C. chapter 6), the Secretary of the Treasury hereby certifies that this final regulation will not have a significant economic impact on a substantial number of small entities. This certification is based on the fact that, prior to the publication of this final regulation and before the enactment of the 2018 Act, taxpayers were already required to satisfy either the 20-50 test or the 40-60 test, as elected by the taxpayer, in order to qualify as a low-income housing project. The 2018 Act added a third minimum set-aside test (the average income test) that taxpayers may elect. This final regulation sets forth requirements for the average income test, and the costs associated with the average income test are similar to the costs associated with the 20-50 test and 40-60 test.
As described in more detail in the PRA analysis section of the preamble, approximately 200 taxpayers elected the average income test for just over 2,000 buildings between 2018 and 2022. When viewed annually, we project that approximately 100 additional taxpayers will have eligible buildings and 1,000 additional buildings will be eligible under the average income test. We estimate that identifying which units are for use in the average income set-aside test and applicable fraction determinations and designating a unit's imputed income limitation takes an average of 15 minutes per unit. Based on an estimated average of 15 units per building and an average 15 minutes of time per unit, an impacted taxpayer will incur an average of 225 minutes per building to record the additional designations due to the flexibility under the regulations for the average income test. In addition, taxpayers are also required to report redesignation of units, and why they are required to redesignate units during the year. For purposes of this analysis, we assume that an average of 4 units per building will be redesignated annually. We estimate each redesignation will take an average of 10 minutes. Thus, we estimate the average number of minutes per year to record redesignations for an impacted taxpayer to be 40 minutes per building for a total average annual burden of 2,000 hours. We also estimate an annual reporting burden related to the expanded flexibility rules to average 20 minutes per impacted taxpayer for a total burden of 100 hours.
Pursuant to section 7805(f), the proposed regulation was submitted to the Chief Counsel for the Office of Advocacy of the Small Business Administration for comment on its impact on small business, and no comments were received. The Treasury Department and the IRS also requested comments from the public.
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) requires that agencies assess anticipated costs and benefits and take certain other actions before issuing a final rule that includes any Federal mandate that may result in expenditures in any one year by a State, local, or Tribal government, in the aggregate, or by the private sector, of $100 million in 1995 dollars, updated annually for inflation. This final rule does not include any Federal mandate that may result in expenditures by State, local, or Tribal governments, or by the private sector in excess of that threshold.
Executive Order 13132 (Federalism) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial, direct compliance costs on State and local governments, and is not required by statute, or preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive order. These regulations do not have federalism implications and do not impose substantial direct compliance costs on State and local governments or preempt State law within the meaning of the Executive order.
Pursuant to the Congressional Review Act (5 U.S.C. 801
Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments) prohibits an agency from publishing any rule that has Tribal implications if the rule either imposes substantial, direct compliance costs on Indian Tribal governments, and is not required by statute, or preempts Tribal law, unless the agency meets the consultation and funding requirements of section 5 of the Executive order. This final rule does not have substantial direct effects on one or more Federally recognized Indian tribes and does not impose substantial direct compliance
The principal author of these regulations is Waheed Olayan, Office of the Associate Chief Counsel (Energy, Credits, and Excise Tax). However, other personnel from the Treasury Department and the IRS participated in their development.
Income taxes, Reporting and recordkeeping requirements.
Accordingly, 26 CFR part 1 is amended as follows:
26 U.S.C. 7805 * * *
Section 1.42-19 also issued under 26 U.S.C. 42(n);
(c) * * *
(1) Identification of low-income units for use in the average income set-aside test or the applicable fraction determination.
(i) In general.
(ii) Recording and communicating.
(2) Notifications to the Agency with jurisdiction over a project.
(i) Agency flexibility.
(ii) Examples.
(3) * * *
(iv) Recording, retention, and annual communications related to designations.
(4) Correcting failures to comply with procedural requirements.
(i) In general.
(ii) Discovery by taxpayer.
(iii) Discovery by Agency.
(iv) Waiver by Agency.
(d) * * *
(2) Process for changing a unit's designated imputed income limitation.
(f) * * *
(4) Taxable years beginning on or after September 30, 2025.
The revisions and additions read as follows:
(c)
(1)
(A) A qualified group of units that satisfy the average income set-aside test; and
(B) A qualified group of units to be used to determine the applicable fraction.
(ii)
(A) Record the identification in its books and records, where the identification must be retained for a period not shorter than the record-retention requirement under § 1.42-5(b)(2); and
(B) Communicate the annual identifications to the applicable housing credit agency (Agency) as provided in paragraph (c)(2) of this section.
(2)
(ii)
(A)
(B)
(C)
(3) * * *
(iv)
(4)
(ii)
(iii)
(iv)
(d) * * *
(2)
(f) * * *
(1)
(2) * * *
(ii) The designation required by paragraph (f)(2)(i) of this section must comply with paragraphs (c)(3)(ii) and (iv) of this section, without taking into account paragraph (c)(4) of this section. Paragraph (c)(2) of this section applies to these designations, except that the Agency may allow the notification to be made along with any other notifications for the first taxable year beginning after December 31, 2022.
(4)
Internal Revenue Service (IRS), Treasury.
Interim final rule.
This document contains interim final regulations relating to the imposition of certain user fees on tax return preparers. These regulations reduce from $11 to $10 the amount of the user fee to apply for or renew a preparer tax identification number (PTIN) and affect individuals who apply for or renew a PTIN. The Independent Offices Appropriation Act of 1952 authorizes the charging of user fees. The text of these interim final regulations also serves as the text of the proposed regulations set forth in the notice of proposed rulemaking on this subject in this issue in the Proposed Rules section of this edition of the
Concerning the interim final regulations, Jamie Song at (202) 317-6845; concerning cost methodology, Maria E. Arias-Buchanan at (202) 803-9569 (not toll-free numbers).
This document contains interim final amendments to 26 CFR part 300 regarding user fees to apply for or renew a PTIN.
The Independent Offices Appropriation Act of 1952 (IOAA), which is codified at 31 U.S.C. 9701, authorizes agencies to prescribe regulations that establish user fees for services provided by the agency. The IOAA provides that regulations implementing user fees are subject to policies prescribed by the President; these policies are set forth in the Office of Management and Budget Circular A-25, 58 FR 38142 (July 15, 1993) (OMB Circular A-25).
Under OMB Circular A-25, Federal agencies that provide services that confer benefits on identifiable recipients are to establish user fees that recover the full cost of providing the service. An agency that seeks to impose a user fee for government-provided services must calculate the full cost of providing those services. In general, a user fee should be set at an amount that allows the agency to recover the direct and indirect costs of providing the service, unless the Office of Management and Budget (OMB) grants an exception. OMB Circular A-25 provides that agencies are to review user fees biennially and update them as necessary.
Section 6109(a)(4) of the Internal Revenue Code (Code) authorizes the Secretary of the Treasury or the Secretary's delegate (Secretary) to prescribe regulations for the inclusion of a tax return preparer's identifying number on a return, statement, or other document required to be filed with the IRS. On September 30, 2010, the Department of the Treasury (Treasury Department) and the IRS published final regulations (TD 9501) under section 6109 in the
Final regulations (TD 9503) published in the
In 2013, the IRS conducted a biennial review of the PTIN user fee and issued a new Cost Model that estimated an
In 2015, the IRS conducted a biennial review of the PTIN user fee and issued a new Cost Model, which determined that the full cost of administering the PTIN program going forward was reduced from $50 to $33 per application or application for renewal, plus a $17 fee per application or application for renewal payable directly to a third-party contractor. Final regulations (TD 9781) published in the
In 2017, the IRS again conducted a biennial review of the PTIN user fee and issued a new Cost Model, which determined that the amount of the fee going forward should be reduced to $31 per application or application for renewal, plus an amount payable directly to a third-party contractor. However, on June 1, 2017, before a notice of proposed rulemaking proposing to reduce the amount of the PTIN user fee was issued, the IRS was enjoined from charging a PTIN user fee. In
In 2019, the IRS again conducted a biennial review of the PTIN user fee and issued a new Cost Model, which determined that the amount of the fee going forward should be reduced to $21 per application or application for renewal, plus a $14.95 fee per application or application for renewal payable directly to a third-party contractor. Final regulations (TD 9903) published in the
In
The district court concluded that the PTIN fees for fiscal years (FYs) 2011 through 2017 were excessive to the extent they were based on: (1) the activities already conceded by the government in the case;
In its 2023 biennial review, the IRS, taking into account the
In accordance with the biennial review requirement in OMB Circular A-25 and taking into account the
The government is authorized to charge a PTIN user fee under the IOAA because, in exchange for the fee, it provides a service by issuing and maintaining PTINs, which provide tax return preparers a specific benefit by allowing them to provide an identifying number that is not a social security number on returns and claims for refund and to prepare returns and claims for refund for compensation. OMB Circular A-25 states that user fees should be collected in advance of or simultaneously with the provision of a service. The PTIN user fee is collected when tax return preparers apply for or renew their PTINs during the application season, which begins annually in October.
The IRS follows generally accepted accounting principles (GAAP) in calculating the full cost of administering PTIN applications and renewals. The Federal Accounting Standards Advisory Board (FASAB) is the body that establishes GAAP that apply for Federal reporting entities, such as the IRS. FASAB publishes the FASAB Handbook of Federal Accounting Standards and Other Pronouncements, as Amended (Current Handbook), available at
The IRS uses various cost-measurement techniques to estimate the cost attributable to the program. These techniques include using various timekeeping systems to measure the time required to accomplish activities, or using information provided by subject-matter experts on the time devoted to a program. To determine the salary and benefits cost incurred to provide the service of providing a PTIN, the IRS estimated the number of full-time employees required to conduct activities related to the costs of issuing and renewing PTINs. The number of full-time employees is based on both current employment numbers and future hiring estimates. The IRS aggregated the hours spent by employees for performing each task, identified by cost center, related to the PTIN user fee, and calculated the percentage of time spent on the PTIN user fee based on a full-time schedule of 2,088 hours annually, with leave and training hours allocated to the resulting percentages based on employees' tasks related to the PTIN user fee.
When the indirect cost of a service or activity is not specifically identified from the cost accounting system, an overhead rate is added to the identifiable direct cost to arrive at full cost. Overhead is an indirect cost of operating an organization that is not specifically identifiable with an activity. Overhead includes costs of resources that are jointly or commonly consumed by one or more organizational unit's activities but are not specifically identifiable to a single activity. These costs can include:
• Financial, human resources, information technology, and general management and administrative.
• Rent and building.
• Procurement, other services, and consulting.
• Property, plant, and equipment.
• Publication services.
• Research, analytical, statistical, library and legal services.
To calculate the overhead allocable to a service, the IRS applies an overhead rate to the identified direct salary and benefits and other direct costs. The overhead rate is the ratio of the IRS's indirect salary, benefits, and non-salary costs of business divisions that do not interact with taxpayers to the salary and benefits costs of business divisions that interact with taxpayers. The IRS calculates an overhead rate annually. For the FY 2025 user fee review, an overhead rate of 62.92 percent was used.
The IRS used projections for FYs 2026 through 2028 to determine the direct and indirect costs associated with the PTIN program that are includible in the PTIN user fee calculation taking into account the
The salary and benefits for the work performed related to the PTIN program is projected to be $17,555,984 in total over FYs 2026 through 2028. In addition to salary and benefits and overhead expenses, the IRS projects incurring travel, training, and supplies costs of $63,579 in each of FYs 2026 through 2028. The total salary and benefits, travel, training, and supplies, and overhead expenses projected are shown below:
The total cost for FYs 2026 through 2028 is therefore projected to be $28,792,946. The number of users is based on FY 2024 numbers adjusted by a projected increase in applications in FYs 2026, 2027, and 2028. Dividing this total cost by the projected population of users for FYs 2026 through 2028 results in a cost per application or application for renewal of $10 as follows: $28,792,946 (total cost) ÷ 2,829,524 (number of applications) = $10.18 (cost per application or application for renewal).
Taking into account the full amount of these costs, the amount of the PTIN user fee per application or application for renewal is $10.
Costs related to a third-party contractor's activities for the issuance, renewal, and maintenance of PTINs, such as processing applications and operating a call center, are included in the PTIN user fee calculation, in accordance with
These interim final regulations are not subject to review under section 6(b) of Executive Order 12866 pursuant to the Memorandum of Agreement (July 4, 2025) between the Treasury Department and OMB regarding review of tax regulations.
Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it is hereby certified that these interim final regulations will not have a significant economic impact on a substantial number of small entities. These final regulations affect all individuals who prepare or assist in preparing all or substantially all of a tax return or claim for refund for compensation. Only individuals, not businesses, can have a PTIN. Thus, the economic impact of these regulations on any small entity generally will be a result of an individual tax return preparer who is required to have a PTIN owning a small business or a small business otherwise employing an individual tax return preparer who is required to have a PTIN. The Treasury Department and the IRS estimate that approximately 915,437, 942,900, and 971,187 individuals will apply annually for an initial or renewal PTIN in FYs 2026, 2027, and 2028, respectively. Although these regulations will likely affect a substantial number of small entities, the economic impact on those entities is not significant. These regulations will establish an $10 fee per application or application for renewal (plus $8.75 payable directly to the third-party contractor), which is a reduction from the previously established fee and will not have a significant economic impact on a small entity. Accordingly, the rule is not expected to have a significant economic impact on a substantial number of small entities, and a regulatory flexibility analysis is not required.
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) requires that agencies assess anticipated costs and benefits and take certain other actions before issuing a final rule that includes any Federal mandate that may result in expenditures in any one year by a State, local, or Tribal government, in the aggregate, or by the private sector, of $100 million in 1995 dollars, updated annually for inflation. This rule does not include any Federal mandate that may result in expenditures by State, local, or Tribal governments, or by the private sector in excess of that threshold.
Executive Order 13132 (Federalism) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial, direct compliance costs on State and local governments, and is not required by statute, or preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive order. These interim final regulations do not have federalism implications and do not impose substantial direct compliance costs on State and local governments or preempt State law within the meaning of the Executive order.
The annual PTIN application and renewal period for the 2025 filing season will begin shortly. It would be unnecessary and contrary to the public interest for the IRS to continue to charge the current, higher user fee pending public comment after the IRS has determined pursuant to the biennial review conducted under OMB Circular A-25 that the PTIN user fee should be reduced going forward. To enable the reduced fee amount to be in effect for PTINs issued to or renewed by tax return preparers preparing returns or claims for refund in 2026, the Treasury Department and the IRS find that there is good cause to dispense with (1) notice and public comment pursuant to 5 U.S.C. 553(b) and (c) and (2) a delayed effective date pursuant to 5 U.S.C. 553(d). The Treasury Department and the IRS will consider public comments submitted in response to the cross-referenced notice of proposed rulemaking published in the Proposed Rules section of this issue of the
Pursuant to section 7805(f) of the Code, this Treasury decision has been submitted to the Chief Counsel for the Office of Advocacy of the Small Business Administration for comment on its impact on small business.
Pursuant to the Congressional Review Act (5 U.S.C. 801
The principal author of these regulations is Jamie Song, Office of the Associate Chief Counsel (Procedure and Administration). Other personnel from the Treasury Department and the IRS participated in the development of the regulations.
Estate taxes, Excise taxes, Fees, Gift taxes, Income taxes, Reporting and recordkeeping requirements.
Accordingly, 26 CFR part 300 is amended as follows:
31 U.S.C. 9701.
(b)
(d)
Equal Employment Opportunity Commission.
Final rule.
In accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, this final rule adjusts for inflation the civil monetary penalty for violation of the notice-posting requirements in Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Genetic Information Non-Discrimination Act, and the Pregnant Workers Fairness Act.
This final rule is effective September 30, 2025.
Gary J. Hozempa, Senior Attorney, (202) 921-2672 or
Under section 711 of the Civil Rights Act of 1964 (Title VII), which is adopted by reference in section 105 of the Americans with Disabilities Act (ADA), section 207(a)(1) of the Genetic Information Non-Discrimination Act (GINA), and section 104 of the Pregnant Workers Fairness Act (PWFA), and implemented by the Equal Employment Opportunity Commission (EEOC) in 29 CFR 1601.30(a), every employer, employment agency, labor organization, and joint labor-management committee controlling an apprenticeship or other training program covered by Title VII, ADA, GINA, or PWFA, must post notices describing the pertinent provisions of these laws. Covered entities must post such notices in prominent and accessible places where they customarily maintain notices to employees, applicants, and members. 29 CFR 1601.30(a). Failure to comply with this posting requirement is subject to a monetary penalty. 29 CFR 1601.30(b).
Section 5(b) of the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Act),
The adjustment set forth in this final rule follows guidance under the 2015 Act from the Office of Management and Budget (OMB)
The Administrative Procedure Act (APA) provides an exception to the notice and comment procedures where an agency finds good cause for dispensing with such procedures, on the basis that they are impracticable, unnecessary, or contrary to the public interest. 5 U.S.C. 553(b)(3)(B). The Commission
This rule is not a significant regulatory action as that term is defined in Executive Order 12866, as amended. The inflationary adjustment's cumulative impact on the violations found each year falls well below the $100 million threshold for significant regulatory action under E.O. 12866, and it otherwise fails to meet the definition of a significant regulatory action.
This final rule contains no new information collection requirements, and therefore, will create no new paperwork burdens or modifications to existing burdens that are subject to review by the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).
The Regulatory Flexibility Act (5 U.S.C. 601-612) only requires a regulatory flexibility analysis when the APA requires notice and comment procedures, or the agency otherwise issues such a notice. As stated above, notice and comment is neither required nor being used for this rule. Accordingly, the Regulatory Flexibility Act does not apply.
This final rule will not result in the expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year, and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.
This regulation is a rule subject to the Congressional Review Act (CRA), but is not a “major” rule that cannot take effect until 60 days after it is published in the
Administrative practice and procedure.
For the Commission.
Accordingly, the Equal Employment Opportunity Commission amends 29 CFR part 1601 as follows:
42 U.S.C. 2000e to 2000e-117; 42 U.S.C. 12111 to 12117; 42 U.S.C. 2000ff to 2000ff-111; 42 U.S.C. 2000gg to 2000gg-16; 28 U.S.C. 2461 note, as amended; Pub. L. 104-134, Sec. 31001(s)(1), 110 Stat. 1373.
(b) Section 711(b) of Title VII and the Federal Civil Penalties Inflation Adjustment Act, as amended, make failure to comply with this section punishable by a fine of not more than $698 for each separate offense.
Federal Aviation Administration (FAA), DOT.
Notice of proposed rulemaking (NPRM).
The FAA proposes to supersede Airworthiness Directive (AD) 2021-23-04 which applies to certain Leonardo S.p.A. Model A109E helicopters. AD 2021-23-04 requires repetitive inspections of the intersection of the lateral pylon and floor spar at station (STA) 1815 for cracking and repair, depending on the findings. Since the FAA issued AD 2021-23-04, it was determined that additional helicopter models are affected by the unsafe condition. Additionally, the manufacturer has developed a modification that provides terminating action for the repetitive inspections. This proposed AD would continue to require repetitive inspections of the affected area for cracking and would add additional helicopter models to the applicability. This proposed AD would also require modifying the affected area, which would be terminating action for the repetitive inspections. The FAA is proposing this AD to address the unsafe condition on these products.
The FAA must receive comments on this proposed AD by November 14, 2025.
You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:
•
•
•
•
• For European Union Aviation Safety Agency (EASA) material identified in this NPRM, contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; phone: +49 221 8999 000; email:
• You may view this material at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy., Room 6N-321, Fort Worth, TX 76177. For information on the availability of this material at the FAA, call (817) 222-5110. The EASA material is also available at
Dan McCully, Program Manager, International Validation Branch, FAA, 1600 Stewart Ave., Suite 410, Westbury, NY 11590; phone: (404) 474-5548; email:
The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the
Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to
CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Dan McCully, Program Manager, International Validation Branch, FAA, 1600 Stewart Ave., Suite 410, Westbury, NY 11590. Any commentary that the FAA receives that is not specifically designated as CBI will be placed in the public docket for this rulemaking.
The FAA issued AD 2021-23-04, Amendment 39-21802 (86 FR 68892, December 6, 2021) (AD 2021-23-04), for Leonardo S.p.a. Model A109E helicopters. AD 2021-23-04 requires repetitive inspections of the intersection of the lateral pylon and floor spar at STA 1815 for cracking and, depending on the findings, repair, as specified in EASA AD 2020-0256, dated November 17, 2020 (EASA AD 2020-0256). The FAA issued AD 2021-23-04 to address cracking in the intersection of the lateral pylon and floor spar at STA 1815 on the left- and right-hand sides, which, if not addressed, could affect the structural integrity of the helicopter.
After the FAA issued AD 2021-23-04, EASA, which is the Technical Agent for the Member States of the European Union, issued superseding EASA AD 2022-0153, dated July 28, 2022 (EASA AD 2022-0153), to correct an unsafe condition for Leonardo S.p.A. Helicopters Model A109E helicopters, all serial numbers (S/N); Model A109S helicopters, all S/Ns up to 22199 inclusive; and Model A109LUH helicopters, all S/Ns. EASA AD 2022-0153 was issued after it was determined that additional helicopters may be affected by the unsafe condition described in EASA AD 2020-0256; therefore, EASA AD 2022-0153 retained the requirements of EASA AD 2020-0253, which was superseded, and increased the applicability by expanding applicable Model A109E helicopters to all S/Ns and adding all Model A109LUH and certain serial-numbered Model A109S helicopters.
After EASA AD 2022-0153 was issued, Leonardo developed a modification which provides terminating action for the repetitive inspections; EASA subsequently issued EASA AD 2024-0004, dated January 5, 2024 (EASA AD 2024-0004) (also referred to as the MCAI), which supersedes EASA AD 2022-0153, retains the inspection requirements of EASA AD 2022-0153, and requires a modification, which consists of a fuselage reinforcement, of the affected area as terminating action for the repetitive inspections. This proposed AD was prompted by reports of cracking in the center fuselage frame assembly in the intersection of the lateral pylon and floor spar at STA 1815 on the left- and right-hand sides and the subsequent development of a modification to that area to prevent cracking. The unsafe condition, if not addressed, could affect the structural integrity of the helicopter.
You may examine EASA AD 2024-0004 in the AD docket at
EASA AD 2024-0004 specifies procedures for repetitive inspections of STA 1815 for cracking, fluorescent liquid penetrant inspections of any cracking to determine the extent of the cracking, or other damage, such as deformation or corrosion, and modifying the affected area by reinforcing the fuselage, which would provide terminating action for the repetitive inspections.
This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the
These products have been approved by the civil aviation authority (CAA) of another country and are approved for operation in the United States. Pursuant to the FAA's bilateral agreement with this State of Design Authority, that authority has notified the FAA of the unsafe condition described in the MCAI. The FAA is issuing this NPRM after determining that the unsafe condition described previously is likely to exist or develop on other products of the same type design.
This proposed AD would require accomplishing the actions specified in EASA AD 2024-0004, described previously as incorporated by reference, except for any differences identified as exceptions in the regulatory text of this proposed AD. See “Differences Between this Proposed AD and the MCAI” for a discussion of the general differences included in this proposed AD.
The MCAI applies to Model A109LUH helicopters, whereas this proposed AD would not because that model is not FAA-type certificated. Where the MCAI provides credit for only initial inspections, this proposed AD would provide credit for any inspections.
In the FAA's ongoing efforts to improve the efficiency of the AD process, the FAA developed a process to use some CAA ADs as the primary source of information for compliance with requirements for corresponding FAA ADs. The FAA has been coordinating this process with manufacturers and CAAs. As a result, the FAA proposes to incorporate EASA AD 2024-0004 by reference in the FAA final rule. This proposed AD would, therefore, require compliance with EASA AD 2024-0004 in its entirety through that incorporation, except for any differences identified as exceptions in the regulatory text of this proposed AD. Using common terms that are the same as the heading of a particular section in EASA AD 2024-0004 does not mean that operators need comply only with that section. For example, where the AD requirement refers to “all required actions and compliance times,” compliance with this AD requirement is not limited to the section titled “Required Action(s) and Compliance Time(s)” in EASA AD 2024-0004. Service material required in EASA AD 2024-0004 for compliance will be available at
The FAA estimates that this AD, if adopted as proposed, would affect 119 helicopters of U.S. Registry. The FAA estimates the following costs to comply with this proposed AD.
The FAA has included all known costs in its cost estimate. According to the manufacturer, however, some of the costs of this proposed AD may be covered under warranty, thereby reducing the cost impact on affected operators.
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.
The FAA is 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.
The FAA determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government.
For the reasons discussed above, I certify this proposed regulation:
(1) Is not a “significant regulatory action” under Executive Order 12866,
(2) Would not affect intrastate aviation in Alaska, and
(3) Would not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:
49 U.S.C. 106(g), 40113, 44701.
The FAA must receive comments on this airworthiness directive (AD) by November 14, 2025.
This AD replaces AD 2021-23-04, Amendment 39-21802 (86 FR 68892, December 6, 2021).
This AD applies to Leonardo S.p.A. Model A109E and Model A109S helicopters, certificated in any category, as identified in European Union Aviation Safety Agency (EASA) AD 2024-0004, dated January 5, 2024 (EASA AD 2024-0004).
Joint Aircraft Service Component (JASC) Code 5300, Fuselage structure.
This AD was prompted by reports of cracking in the center fuselage frame assembly in the intersection of the lateral pylon and floor spar at station 1815 on the left- and right-hand sides and the subsequent development of a modification to that area to prevent cracking. The FAA is issuing this AD to address this cracking which, if not addressed, could affect the structural integrity of the helicopter.
Comply with this AD within the compliance times specified, unless already done.
Except as specified in paragraphs (h) and (i) of this AD: Comply with all required actions and compliance times specified in, and in accordance with, EASA AD 2024-0004.
(1) Where EASA AD 2024-0004 requires compliance in terms of flight hours, this AD requires using hours time-in-service.
(2) Where EASA AD 2024-0004 refers to “[the effective date of EASA 2020-0256]”, this AD requires using the effective date of AD 2021-23-04, which is January 10, 2022.
(3) Where EASA AD 2024-0004 refers to its effective date and August 11, 2022 (the effective date of EASA AD 2022-0153, dated July 28, 2022), this AD requires using the effective date of this AD.
(4) Where paragraphs (3) and (4) of EASA AD 2024-0004 specifies damage, for the purposes of this AD, damage can be indicated by, but not limited to, corrosion or deformation.
(5) Where paragraph (5) of EASA AD 2024-0004 specifies contacting Leonardo for approved repair instructions and accomplishing those instructions accordingly, this AD requires corrective action must be done in accordance with a method approved by the Manager, International Validation Branch, FAA; or EASA; or Leonardo S.p.A. Helicopters' EASA Design Organization Approval (DOA). If approved by the DOA, the approval must include the DOA-authorized signature.
(6) Where paragraph (7) of EASA AD 2024-0004 applies to initial inspections, for this AD, replace that text with “any inspection”.
(7) Where paragraph (8) of EASA AD 2024-0004 allows credit for repairs accomplished in accordance with the applicable Leonardo approved repair instructions, whereas this AD does not allow that credit.
(8) Where the material referenced in EASA AD 2024-0004 specifies discarding parts, this AD requires removing those parts from service.
(9) This AD does not adopt the “Remarks” section of EASA AD 2024-0004.
Although the service material referenced in EASA AD 2024-0004 specifies submitting certain information to the manufacturer, this AD does not include that action.
Special flight permits are prohibited.
(1) The Manager, International Validation Branch, 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 International Validation Branch, send it to the attention of the person identified in paragraph (l) of this AD and email to:
(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.
For more information about this AD, contact Dan McCully, Program Manager, International Validation Branch, FAA, 1600 Stewart Ave., Suite 410, Westbury, NY 11590; phone: (404) 474-5548; email:
(1) The Director of the Federal Register approved the incorporation by reference of the service material listed in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
(2) You must use this service material as applicable to do the actions required by this AD, unless this AD specifies otherwise.
(i) European Union Aviation Safety Agency (EASA) AD 2024-0004, dated January 5, 2024.
(ii) [Reserved]
(3) For EASA material identified in this AD, contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; phone: +49 221 8999 000; email:
(4) You may view this material at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy., Room 6N-321, Fort Worth, TX 76177. For information on the availability of this material at the FAA, call (817) 222-5110.
(5) You may view this material at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, visit
Federal Aviation Administration (FAA), DOT.
Notice of proposed rulemaking (NPRM).
The FAA proposes to adopt a new airworthiness directive (AD) for all The Boeing Company Model 747-100, -100B, -100B SUD, -200B, -200C, -200F, -300, -400, -400D, -400F, 747SP, and 747SR series airplanes. This proposed AD was prompted by reports of corrosion damage found on a certain satellite communications (SATCOM) high gain antenna adapter plate. This proposed AD would require repetitive detailed inspections (DET) of the SATCOM high gain antenna adapter plate for corrosion and applicable on-condition actions. The FAA is proposing this AD to address the unsafe condition on these products.
The FAA must receive comments on this proposed AD by November 14, 2025.
You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:
•
•
•
•
• For Boeing material identified in this proposed AD, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone 562-797-1717; website
• You may view this material at the FAA, Airworthiness Products Section, Operational Safety Branch, 2200 South 216th St., Des Moines, WA. For information on the availability of this material at the FAA, call 206-231-3195. It is also available at
Stefanie Roesli, Aviation Safety Engineer, FAA, 2200 South 216th St., Des Moines, WA 98198; phone: 206-231-3964;
The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments using a method listed under the
Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to
CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Stefanie Roesli, Aviation Safety Engineer, FAA, 2200 South 216th St., Des Moines, WA 98198; phone: 206-231-3964; email:
The FAA has received a report indicating that corrosion damage was found on a certain 767 SATCOM high gain antenna adapter plate during a heavy maintenance check by an operator. The most severe corrosion was found at the nutplates around the edges of the adapter plate; the nutplates are used to fasten the antenna assembly to the adapter plate. If undetected corrosion of these SATCOM high gain antenna adapter plates is not addressed, it can result in a parts departing the airplane (PDA) event, where the SATCOM high gain antenna system parts may impact and damage the airplane. This condition, if not addressed, could result in loss of continued safe flight and landing.
Boeing issued Alert Service Bulletin 767-23A0351, dated January 23, 2025, to address this issue on Model 767-200, 767-300, 767-300F, and 767-400ER airplanes. The FAA subsequently issued an NPRM (Docket No. FAA-2025-0741, 90 FR 17741, April 29, 2025) to propose to require repetitive DET of the SATCOM high gain antenna adapter plate for corrosion and applicable on-condition actions for those airplanes. A similar adapter plate design and installation is used on Model 747 airplanes. Therefore, Model 747
The FAA is issuing this NPRM after determining that the unsafe condition described previously is likely to exist or develop on other products of the same type design.
The FAA reviewed Boeing Alert Requirements Bulletin 747-23A2628 RB, dated April 18, 2025. This material specifies procedures for repetitive DET of the SATCOM high gain antenna adapter plates for corrosion and applicable on-condition actions. On-condition actions include repairing the SATCOM high gain antenna adapter plate or replacing it with a new or serviceable SATCOM high gain antenna adapter plate if any corrosion found is less than or equal to 0.005 inch in depth; and replacing the SATCOM high gain antenna adapter plate with a new or serviceable SATCOM high gain antenna adapter plate if any corrosion found is greater than 0.005 inch in depth. This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the
This proposed AD would require accomplishing the actions specified in the material already described, except for any differences identified as exceptions in the regulatory text of this proposed AD. For information on the procedures and compliance times, see this material at
The FAA estimates that this AD, if adopted as proposed, would affect 120 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:
The FAA estimates the following costs to do any necessary repairs or replacements that would be required based on the results of the proposed inspection. The agency has no way of determining the number of aircraft that might need these repairs or replacements:
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.
The FAA is 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.
The FAA determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.
For the reasons discussed above, I certify this proposed regulation:
(1) Is not a “significant regulatory action” under Executive Order 12866,
(2) Would not affect intrastate aviation in Alaska, and
(3) Would not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:
49 U.S.C. 106(g), 40113, 44701.
The FAA must receive comments on this airworthiness directive (AD) by November 14, 2025.
None.
This AD applies to all The Boeing Company Model 747-100, -100B, -100B SUD, -200B, -200C, -200F, -300, -400,
Air Transport Association (ATA) of America Code 23, Communications system.
This AD was prompted by reports of corrosion damage found on a certain satellite communications (SATCOM) high gain antenna adapter plate. The FAA is issuing this AD to prevent corrosion damage of the SATCOM high gain antenna adapter plates. The unsafe condition, if not addressed, could result in the SATCOM high gain antenna system parts departing and impacting the airplane, which can cause damage that results in loss of continued safe flight and landing.
Comply with this AD within the compliance times specified, unless already done.
Except as specified by paragraph (h) of this AD: At the applicable times specified in the “Compliance” paragraph of Boeing Alert Requirements Bulletin 747-23A2628 RB, dated April 18, 2025, do all applicable actions identified in, and in accordance with, the Accomplishment Instructions of Boeing Alert Requirements Bulletin 747-23A2628 RB, dated April 18, 2025.
Note 1 to paragraph (g): Guidance for accomplishing the actions required by this AD can be found in Boeing Alert Service Bulletin 747-23A2628, dated April 18, 2025, which is referred to in Boeing Alert Requirements Bulletin 747-23A2628 RB, dated April 18, 2025.
(1) Where Boeing Alert Requirements Bulletin 747-23A2628 RB, dated April 18, 2025, refers to the original issue date of Requirements Bulletin 747-23A2628 RB, this AD requires using the effective date of this AD.
(1) The Manager, AIR-520, Continued Operational Safety Branch, 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 responsible Flight Standards Office, as appropriate. If sending information directly to the manager of the Continued Operational Safety Branch, send it to the attention of the person identified in paragraph (j)(1) of this AD. Information may be emailed to:
(2) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by The Boeing Company Organization Designation Authorization (ODA) that has been authorized by the Manager, AIR-520, Continued Operational Safety Branch, FAA, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.
(1) For more information about this AD, contact Stefanie Roesli, Aviation Safety Engineer, FAA, 2200 South 216th St., Des Moines, WA 98198; phone: 206-231-3964; email:
(2) Material identified in this AD that is not incorporated by reference is available at the address specified in paragraph (k)(3) this AD.
(1) The Director of the Federal Register approved the incorporation by reference of the material listed in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
(2) You must use this material as applicable to do the actions required by this AD, unless the AD specifies otherwise.
(i) Boeing Alert Requirements Bulletin 747-23A2628 RB, dated April 18, 2025.
(ii) [Reserved]
(3) For Boeing material identified in this AD, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone 562-797-1717; website
(4) You may view this material at the FAA, Airworthiness Products Section, Operational Safety Branch, 2200 South 216th St., Des Moines, WA. For information on the availability of this material at the FAA, call 206-231-3195.
(5) You may view this material at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, visit
Federal Aviation Administration (FAA), DOT.
Notice of proposed rulemaking (NPRM).
The FAA proposes to adopt a new airworthiness directive (AD) for all Airbus Helicopters Model AS355E, AS 355-F, AS 355-F1, AS355F2, and AS355N helicopters. This proposed AD was prompted by reports of cracks in the legs of the side supports of the tail rotor transmission fan. This proposed AD would require repetitively inspecting the side supports of the tail rotor transmission fan for cracks and, depending on the results, replacing both side supports. The FAA is proposing this AD to address the unsafe condition on these products.
The FAA must receive comments on this NPRM by November 14, 2025.
You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:
•
•
•
•
• For European Union Aviation Safety Agency (EASA) material identified in this proposed AD, contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; phone: +49 221 8999 000; email:
• You may view this material at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Parkway, Room 6N-321, Fort Worth, TX 76177. For information on the availability of this material at the FAA, call (817) 222-5110. It is also available at
Kim-Anh Tran, Aviation Safety Engineer, FAA, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; phone:
The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments using a method listed under the
Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to
CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Kim-Anh Tran, Aviation Safety Engineer, FAA, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.
EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2025-0052, dated February 28, 2025 (EASA AD 2025-0052) (also referred to as the MCAI), to correct an unsafe condition on all Airbus Helicopters Model AS 355 E, AS 355 F, AS 355 F1, AS 355 F2, and AS 355 N helicopters. The MCAI states there have been reports, following scheduled maintenance, of cracks in the legs of the left hand (LH) and right hand (RH) side supports of the tail rotor transmission fan installed on helicopters with the post-mod 07-9062 configuration. This condition, if not addressed, could result in failure of the legs supporting the tail rotor transmission fan and displacement of the tail rotor transmission fan assembly, which could lead to the loss of the engine and main gearbox cooling function, loss of the tail rotor drive, and consequent loss of control of the helicopter.
The FAA is issuing this AD to detect and correct a cracked side support of the tail rotor transmission fan.
You may examine the MCAI in the AD docket at
The FAA reviewed EASA AD 2025-0052, which specifies procedures for repetitive inspections of the LH and RH side supports of the tail rotor transmission fan, having part number (P/N) 355A34104006 (LH) and P/N 355A34104106 (RH) respectively, for cracks and, if any crack is found on any side support, replacement of both side supports. EASA AD 2025-0052 also specifies reporting the inspection results to the manufacturer. This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the
These products have been approved by the civil aviation authority (CAA) of another country and are approved for operation in the United States. Pursuant to the FAA's bilateral agreement with this State of Design Authority, that authority has notified the FAA of the unsafe condition described in the MCAI referenced above. The FAA is issuing this NPRM after determining that the unsafe condition described previously is likely to exist or develop on other products of the same type design.
This proposed AD would require accomplishing the actions specified in EASA AD 2025-0052, described previously, as incorporated by reference, except for any differences identified as exceptions in the regulatory text of this proposed AD. See “Differences Between this Proposed AD and the MCAI” for a discussion of the general differences included in this proposed AD.
The MCAI requires reporting inspection results to the manufacturer, whereas this proposed AD would not.
The FAA considers that this proposed AD would be an interim action. The manufacturer is still investigating the root cause of the unsafe condition identified in this AD. If final action is later identified, the FAA might consider further rulemaking.
In the FAA's ongoing efforts to improve the efficiency of the AD process, the FAA developed a process to use some CAA ADs as the primary source of information for compliance with requirements for corresponding FAA ADs. The FAA has been coordinating this process with manufacturers and CAAs. As a result, the FAA incorporates EASA AD 2025-0052 by reference in the FAA final rule. This proposed AD would, therefore, require compliance with EASA AD 2025-0052 in its entirety through that incorporation, except for any differences identified as exceptions in the regulatory text of this proposed AD. Using common terms that are the same as the heading of a particular section in EASA AD 2025-0052 does not mean that operators need comply only with that section. For example, where the AD requirement refers to “all required actions and compliance times,” compliance with this AD requirement is not limited to the section titled “Required Action(s) and Compliance Time(s)” in EASA AD 2025-0052. Material referenced in EASA AD 2025-0052 for compliance will be available at
The FAA estimates that this AD, if adopted as proposed, would affect 38 helicopters of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:
The FAA estimates the following costs to do any necessary on-condition actions that would be required based on the results of the proposed inspection. The agency has no way of determining the number of helicopters that might need these on-condition actions:
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.
The FAA is 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.
The FAA determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.
For the reasons discussed above, I certify this proposed regulation:
(1) Is not a “significant regulatory action” under Executive Order 12866,
(2) Would not affect intrastate aviation in Alaska, and
(3) Would not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:
49 U.S.C. 106(g), 40113, 44701.
The FAA must receive comments on this airworthiness directive (AD) by November 14, 2025.
None.
This AD applies to Airbus Helicopters Model AS355E, AS 355-F, AS 355-F1, AS355F2, and AS355N helicopters, certificated in any category.
Joint Aircraft System Component (JASC) Code 6500, Tail Rotor Drive System.
This AD was prompted by reports of cracks in the legs of the side support of the tail rotor transmission fan. The FAA is issuing this AD to detect and correct a cracked side support of the tail rotor transmission fan. The unsafe condition, if not addressed, could result in failure of the legs supporting the tail rotor transmission fan and displacement of the tail rotor transmission fan assembly, which could lead to the failure of the engine and main gearbox cooling function, loss of the tail rotor drive, and consequent loss of control of the helicopter.
Comply with this AD within the compliance times specified, unless already done.
Except as specified in paragraphs (h) and (i) of this AD: Comply with all required actions and compliance times specified in, and in accordance with, European Union Aviation Safety Agency AD 2025-0052, dated February 28, 2025 (EASA AD 2025-0052).
(1) Where EASA AD 2025-0052 requires compliance in terms of flight hours, this AD requires using hours time-in-service.
(2) Where EASA AD 2025-0052 refers to its effective date, this AD requires using the effective date of this AD.
(3) Where paragraph (2) of EASA AD 2025-0052 specifies “replace both affected parts in accordance with the instructions of the ASB”, this AD requires replacing that text with “remove both affected parts from service and replace with new (zero hours time-in-service) parts in accordance with the instructions of the ASB”.
(4) This AD does not adopt the “Remarks” section of EASA AD 2025-0052.
Although EASA AD 2025-0052 and the material referenced in EASA AD 2025-0052 specify to submit certain information to the manufacturer, this AD does not include that requirement.
Special flight permits are prohibited.
(1) The Manager, International Validation Branch, 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
(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.
For more information about this AD, contact Kim-Anh Tran, Aviation Safety Engineer, FAA, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; phone: (316) 946-4190; email:
(1) The Director of the Federal Register approved the incorporation by reference of the material listed in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
(2) You must use this material as applicable to do the actions required by this AD, unless the AD specifies otherwise.
(i) European Union Aviation Safety Agency (EASA) AD 2025-0052, dated February 28, 2025.
(ii) [Reserved]
(3) For EASA material identified in this AD, contact EASA, Konrad-Adenauer-Ufer 3, 50668 Cologne, Germany; phone: +49 221 8999 000; email:
(4) You may view this material at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Parkway, Room 6N-321, Fort Worth, TX 76177. For information on the availability of this material at the FAA, call (817) 222-5110.
(5) You may view this material at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, visit
Internal Revenue Service (IRS), Treasury.
Cancellation of a notice of public hearing on a proposed rulemaking.
This document cancels a public hearing on proposed regulations regarding previously taxed earnings and profits of foreign corporations and related basis adjustments.
The public hearing scheduled for October 2, 2025, at 10 a.m. Eastern Standard Time (EST) is cancelled.
See public comments submitted electronically via the Federal eRulemaking Portal at
Martina Greene of the Publications and Regulations Section, Associate Chief Counsel (Procedure and Administration) at (202) 317-6901 (not a toll-free number).
A notice of proposed rulemaking appeared in the
Internal Revenue Service (IRS), Treasury.
Withdrawal of notices of proposed rulemaking.
This document withdraws a notice of proposed rulemaking containing proposed regulations relating to corporate separations, incorporations, and reorganizations qualifying, in whole or in part, for nonrecognition of gain or loss. This document also withdraws a notice of proposed rulemaking containing proposed regulations that would have required multi-year tax reporting for corporate separations and related transactions. The proposed regulations would have affected corporations and their shareholders and security holders.
The notices of proposed rulemaking published in the
Send paper submissions to CC:PA:01:PR (REG-112261-24 and REG-116085-23), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. All public comments received with respect to the notices of proposed rulemaking (REG-112261-24 and REG-116085-23) are available to review at
Justin R. Du Mouchel at (202) 317-6975 (not a toll-free number).
On January 16, 2025, the Treasury Department and the IRS published a notice of proposed rulemaking (REG-112261-24) in the
On the same date, the Treasury Department and the IRS also published a notice of proposed rulemaking (REG-116085-23) in the
The Treasury Department and the IRS received several comments in response
The principal author of this notice is Justin R. Du Mouchel of the Office of Associate Chief Counsel (Corporate). However, other personnel from the Treasury Department and the IRS participated in its development.
Income taxes, Reporting and recordkeeping requirements.
Under the authority of 26 U.S.C. 7805, the notices of proposed rulemaking (REG-112261-24 and REG-116085-23) that were published in the
Internal Revenue Service (IRS), Treasury.
Notice of proposed rulemaking.
In the Rules and Regulations section of this issue of the
Electronic or written comments and requests for a public hearing must be received by October 30, 2025.
Commenters are strongly encouraged to submit public comments electronically. Submit electronic submissions via the Federal eRulemaking Portal at
Concerning the proposed regulations, Jamie Song at (202) 317-6845; concerning cost methodology, Maria E. Arias-Buchanan at (202) 803-9569; concerning submissions of comments or requests for a public hearing, the Publications and Regulations Section at (202) 317-6901 (not toll-free numbers) or by email at
Interim final regulations in the Rules and Regulations section of this issue of the
The text of the interim final regulations also serves as the text of these proposed regulations. The preamble to the interim final regulations explains the interim final regulations and these proposed regulations.
These proposed regulations are not subject to review under section 6(b) of Executive Order 12866 pursuant to the Memorandum of Agreement (July 4, 2025) between the Treasury Department and the Office of Management and Budget regarding review of tax regulations.
Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it is hereby certified that these proposed regulations will not have a significant economic impact on a substantial number of small entities. These proposed regulations affect individuals who prepare or assist in preparing all or substantially all of a tax return or claim for refund for compensation. Only individuals, not businesses, can have a PTIN. Thus, the economic impact of these regulations on any small entity generally will be a result of an individual tax return preparer who is required to have a PTIN owning a small business or a small business otherwise employing an individual tax return preparer who is required to have a PTIN. The Treasury Department and the IRS estimate that approximately 915,437, 942,900, and 971,187 individuals will apply annually for an initial or renewal PTIN in fiscal years 2026, 2027, and 2028, respectively. Although the interim final regulations will likely affect a substantial number of small entities, the economic impact on those entities is not significant. The interim final regulations will establish a $10 user fee per application or renewal (plus $8.75 payable directly to the contractor), which is a reduction from the previously established user fee and will not have a significant economic impact on a small entity. Accordingly, the Secretary of the Treasury (or the Secretary's delegate) certifies that the rule will not have a significant economic impact on a substantial number of small entities, and a regulatory flexibility analysis is not required.
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) requires that agencies assess anticipated costs and benefits and take certain other actions before issuing a final rule that includes any Federal mandate that may result in expenditures in any one year by a State, local, or Tribal government, in the aggregate, or by the private sector, of $100 million in 1995 dollars, updated annually for inflation. This rule does not include any Federal mandate that may result in expenditures by State, local, or Tribal governments, or by the private sector in excess of that threshold.
Executive Order 13132 (Federalism) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial,
Pursuant to section 7805(f) of the Internal Revenue Code, this notice of proposed rulemaking has been submitted to the Chief Counsel of the Office of Advocacy of the Small Business Administration for comment on its impact on small business.
Consideration will be given to comments that are submitted timely to the IRS as prescribed in this preamble under the
A public hearing will be scheduled if requested in writing by any person who timely submits electronic or written comments. Requests for a public hearing are also encouraged to be made electronically. If a public hearing is scheduled, notice of the date and time for the public hearing will be published in the
The principal author of these regulations is Jamie Song, Office of the Associate Chief Counsel (Procedure and Administration). Other personnel from the Treasury Department and the IRS participated in the development of the regulations.
Estate taxes, Excise taxes, Fees, Gift taxes, Income taxes, Reporting and recordkeeping requirements.
Accordingly, the Treasury Department and IRS propose to amend 26 CFR part 300 as follows:
31 U.S.C. 9701.
(b) [The text of proposed § 300.11(b) is the same as the text of § 300.11(b) in the interim final rule published elsewhere in this issue of the
(d) [The text of proposed § 300.11(d) is the same as the text of § 300.11(d) in the interim final rule published elsewhere in this issue of the
Office of Postsecondary Education, Department of Education.
Contingent change to meeting dates.
The Department of Education announced in the
In the event of cancellation of the in-person meetings announced for October 1-3, due to a lapse in appropriation, the Committee will meet virtually on October 15-17, from 9:00 a.m. to 12:00 p.m. and 1:00 p.m. to 4:00 p.m. Eastern time. During these times, the committees may temporarily recess for caucuses or work sessions to develop new regulatory language for consideration by the full committee.
The meeting will be held virtually. We will post a registration link on our website at
For general information about negotiated rulemaking, see the Frequently Asked Questions Section of the Negotiated Rulemaking Process for Title IV regulations website at:
For information about the virtual public hearing, or for additional information about negotiated rulemaking,
If you are deaf, hard of hearing, or have a speech disability and wish to access telecommunications relay services, please dial 7-1-1.
The Department of Education announced in the
This rulemaking is necessary to implement recent statutory changes to the Title IV, Higher Education Act programs in the
In the event of cancellation of the in-person meetings occurring on October 1-3, due to a lapse in appropriation, the Committee will meet virtually on October 15-17, from 9:00 a.m. to 12:00 p.m. and 1:00 p.m. to 4:00 p.m. Eastern time. During these times, the committees may temporarily recess for caucuses or work sessions to develop new regulatory language for consideration by the full committee.
Registration is also required to view the virtual hearing. American Sign Language translation and closed captioning will be provided for the virtual hearing. We will post registration links for attendees who wish to observe on our website at
The additional meeting will be conducted virtually and be available for the public to watch via livestream on the internet. Registration is required to observe the meeting via livestream. We will post a registration link on our website at
Surface Transportation Board.
Notice of proposed rulemaking.
The Board proposes to terminate Class I carriers' supplemental reporting of certain Positive Train Control (PTC) expenditures and to require Class I carriers to report two service metrics on a weekly basis. Because PTC is now fully implemented, the Board proposes deregulatory action to end this reporting. With respect to service-related reporting, the Board proposes to require Class I carriers to report metrics that would advance the Board's objective of ensuring rail service reliability.
Comments, as described below, are due by October 30, 2025. Replies are due by November 13, 2025.
All filings must be submitted to the Surface Transportation Board either via e-filing on the Board's website or in writing addressed to 395 E Street SW, Washington, DC 20423-0001. Filings will be posted to the Board's website and need not be served on other commenters or any other party to the proceeding.
Pedro Ramirez at (202) 915-0862. If you require accommodation under the Americans with Disabilities Act, please call (202) 245-0245.
The Rail Safety Improvement Act of 2008 (RSIA) required Class I rail carriers to implement PTC—an automated safety system designed to prevent certain types of train accidents—by December 31, 2015, on main lines where intercity or commuter rail passenger transportation, as defined in 49 U.S.C. 24102, is regularly provided, and main lines over which five million or more gross tons of annual traffic and poison- or toxic-by-inhalation hazardous materials, as defined in 49 CFR 171.8, 173.115, and 173.132, are transported. 49 U.S.C. 20157(a)(1);
Under 49 U.S.C. 11145(b)(1), the Board may require rail carriers to file with the Board an annual report containing “an account, in as much detail as the Board may require, of the affairs of the rail carrier.” 49 U.S.C. 11145(b)(1). The Board's regulations require each Class I rail carrier to submit such annual reports, known as R-1 reports, containing information about finances and operating statistics. 49 CFR 1241.11(a).
In response to a petition by Union Pacific Railroad Company (UP) in 2013, the Board adopted, via notice-and-comment rulemaking, a supplement to the annual R-1 reporting requirements specifically addressing PTC expenditures.
[The supplement] would provide [the Board] with important information that would help identify transportation industry changes that may require attention by the agency and would assist the Board in preparing financial and statistical summaries and abstracts to provide itself, Congress, other government agencies, the transportation industry, and the public with transportation data useful in making regulatory policy and business decisions.
Accordingly, PTC expenditures today are incorporated into R-1 reports under the category of “capital investments and expenses” as well as in a “PTC Supplement” that breaks out PTC expenses from broader categories.
The PTC Supplement requires the carriers to submit PTC versions of schedules 330 (road property and equipment improvements), 332 (depreciation base and rates—road property and equipment), 335
On December 29, 2020, FRA announced that PTC implementation was complete on all required freight and passenger railroad route miles. FRA, Positive Train Control (PTC),
On August 26, 2024, the Association of American Railroads (AAR) filed a petition to reopen Docket No. EP 706 and terminate the PTC Supplement requirement. The Board takes notice of AAR's arguments and is issuing this notice of proposed rulemaking on its own motion.
AAR states that when the railroads requested that the Board adopt the PTC Supplement requirement more than a decade ago, PTC-related capital costs and operating expenditures were “anticipated to be particularly high during the installation stage.” AAR Pet. 1,
Additionally, AAR argues that Class I railroads are now “incurring unnecessary costs and expending significant time” to comply with the PTC-related reporting requirements.
Given that PTC has been fully implemented, the Board finds the benefits from the supplemental reporting,
Additionally, if the Board adopts the proposed discontinuance of supplemental PTC reporting, the Board proposes to require all Class I carriers to submit a one-time summary document identifying individual line items in their respective R-1 reports that contain PTC-related expenditures representing at least 15% of the line-item amounts.
Rail service reliability is essential to the economy, and the Board prioritizes monitoring rail service for emerging issues so that it can act promptly to address them.
The Board expects that these requirements would constitute just one component of a broader effort to enhance, focus, and automate the agency's data collection. First, the Board is evaluating ways to improve data visualization on its public website and to improve the transparency and consistency of reporting across the metrics it collects. Second, the Board is considering the utility of certain existing metrics that are not widely
The OETA metric would measure a carrier's success in meeting its estimated arrival times for shipments. The Board proposes to define OETA as the estimated time of arrival that the rail carrier provides when the shipper tenders the bill of lading or when the rail carrier receives the shipment from an interchanging carrier. Class I carriers would report, for shipments moving in manifest service, the percentage of weekly shipments that were delivered to destination no later than 24 hours after the OETA,
OETA reporting would give the Board insight into the timeliness of deliveries of manifest traffic system-wide. Late deliveries can, among other things, lead to supply chain disruptions, which can, in some instances, cause shippers to suspend operations. Chronic late deliveries may also force shippers to order additional shipments that would otherwise be unnecessary, and in some instances, encourage shippers to maintain unnecessarily large private car fleets to compensate for delays to shipments as well as to their own cars delayed in transit. These shipper actions can create ripple effects, leading to increased railroad congestion. Monitoring timeliness through OETA reporting would therefore advance the Board's objective of ensuring rail service reliability, enabling the Board to take more informed and expeditious action where necessary, including through informal engagement.
The proposed ISP metric would measure a rail carrier's success in performing local placements (“spots”) and pick-ups (“pulls”) of loaded railcars and unloaded private or shipper-leased railcars at shippers' or receivers' facilities during a planned service window. The metric would not apply to unit trains or intermodal traffic.
The ISP metric would be calculated by comparing the number of cars for which the carrier successfully completed the requested placements or pick-ups to the number of cars for which the shipper or receiver, by the applicable cut-off time, requested a placement or pick-up. For example, if over the course of a reporting period, a carrier delivers nine of 10 requested cars within the first service window and pulls seven of 10 requested cars during a second service window, the carrier's ISP metric would be 80%.
Under the proposed rule, carriers would report ISP performance both at the system level and at the operating division level. For reporting at the operating division level, carriers would establish reporting regions using any geographic boundaries that they choose, provided that they identify the boundaries as part of their reporting, consistent with their business practices.
Interested persons will be invited to comment on the Board's proposals regarding PTC-related expenditure reporting and service data reporting. Comments will be due by October 30, 2025. Replies may be filed by November 13, 2025.
The Board specifically seeks comment on whether to include unit and intermodal traffic in the OETA and ISP metrics. As it pertains to OETA, the Board has stated that, based on the agency's experience, unit trains generally do not have schedules and run at various, usually irregular times.
The proposed rule modifications under 49 CFR parts 1241 and 1251 are categorically excluded from environmental review under 49 CFR 1105.6(c).
The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, generally requires a description and analysis of new rules that would have a significant economic impact on a substantial number of small entities. In drafting a rule, an agency is required to: (1) assess the effect that its regulation will have on small entities; (2) analyze effective alternatives that may minimize a regulation's impact; and (3) make the analysis available for public comment. 5 U.S.C. 601-604. In its notice of proposed rulemaking, the agency must either include an initial regulatory flexibility analysis, § 603(a), or certify that the proposed rule would not have a “significant impact on a substantial number of small entities,” § 605(b). The impact must be a direct impact on small entities “whose conduct is circumscribed or mandated” by the proposed rule.
The data reporting changes proposed here would apply only to Class I railroads—the nation's largest. For the purpose of RFA analysis for rail carriers subject to the Board's jurisdiction, the Board defines a “small business” as including only Class III carriers—the nation's smallest.
A copy of this decision will be served upon the Chief Counsel for Advocacy, Office of Advocacy, U.S. Small Business Administration.
Under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501-3521, Office of Management and Budget (OMB) regulations at 5 CFR 1320.8(d), and the Appendix below, the Board seeks comment about the impact of proposed changes to the collection “Class I Railroad Annual Report” (OMB Control No. 2140-0009) and the proposed new collection of service data from Class I carriers, pursuant to OMB Control Number 2140-XXXX, concerning: (1) whether the proposed collections of information, which is further described in the Appendix below, are necessary for the proper performance of the functions of the Board, including whether the collection has practical utility; (2) the accuracy of the Board's burden estimates; (3) ways to enhance the quality, utility, and clarity of the information collected; and (4) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology, when appropriate.
The Board estimates that the proposed rule changes and the related modifications to an existing data collection and a new data collection would reduce the total annual hourly burdens from 1,750 hours to 1,512 hours, resulting in an overall net burden reduction on respondents of 238 hours, as detailed below in the Appendix below. There are no changes in non-hourly burdens associated with the Class I Railroad Annual Report collection, and there are no non-hourly burdens associated with the new collection. The Board welcomes comments on the estimates of the reduction in time and costs of the collections. The proposed rule modifications will be submitted to OMB for review as required under 44 U.S.C. 3507(d) and 5 CFR 1320.11. Comments received by the Board regarding the information collections will also be forwarded to OMB for its review when the final rule is published.
Executive Order 12866, as modified by Executive Order 14215, provides that the Office of Information and Regulatory Affairs (OIRA) will review all significant rules. OIRA has determined that this rule is not significant. The Board believes this proposed action would be net deregulatory under Executive Order 14192.
Railroads; Reporting and recordkeeping requirements.
Railroads; Reporting and recordkeeping requirements.
1. The Board proposes to amend its regulations as set forth in this decision. Notice of the proposed rules will be published in the
2. Comments from interested parties are due by October 30, 2025. Replies may be filed by November 13, 2025.
3. A copy of this decision will be served upon the Chief Counsel for Advocacy, Office of Advocacy, U.S. Small Business Administration.
4. This decision is effective on its date of service.
By the Board, Board Members Fuchs, Hedlund, and Schultz.
For the reasons set forth in the preamble, and under the authority of 49 U.S.C. 1321 and 11145, the Surface Transportation Board proposes to amend parts 1241 and 1251 of title 49, chapter X, of the Code of Federal Regulations as follows:
49 U.S.C. 11145.
Note 1 to § 1241.11. The report forms prescribed by § 1241.11 are available at the Surface Transportation Board website.
49 U.S.C. 1321 and 49 U.S.C. 11145.
The following definitions apply to this part:
(1) The recipient has the option, by prior agreement between the rail carrier and the customer, to have the rail carrier hold the shipment pending the recipient's request for delivery to the designated destination and the recipient has not yet requested delivery; or
(2) The recipient is unable to accept delivery at the designated destination.
All rail carriers shall report to the Board on a weekly basis, in a manner and form determined by the Board, the data described in this section. The service metrics in this section apply only to the data collection contemplated under this part.
(a)
(1)
(2)
(b)
(1)
(i) Failure to spot a constructively placed car that has been ordered in by the cut-off time applicable to the customer for a planned service window shall be included as a failure in calculating the ISP metric.
(ii) Failure to spot “spot on arrival” railcars (
(iii) If a rail carrier cancels a service window, other than at the shipper's or receiver's request, each planned spot or pull from the cancelled service window shall be included as a failure in calculating the ISP metric.
(iv) When a rail customer causes a carrier to miss a spot or a pull during a planned service window, those spots or pulls will not be considered failures in calculating the ISP metric.
(2)
In this notice, the Board is requesting comments on the following information collections:
Information from certain schedules contained in these reports is compiled and published on the Board's website,
Positive Train Control (PTC) is a federally mandated safety system designed to prevent train-to-train collisions, over-speed derailments, incursions into established work zone limits, and the movement of a train through a switch left in the wrong position. 49 U.S.C. 20157(i)(5). Since Congress first enacted PTC requirements, Class I railroads have incurred substantial PTC-related development and installation costs, which have been reflected in R-1 reports. Additionally, since 2013, railroads have been required to provide supplemental PTC expense and other information as part of their R-1 reports.
According to the Association of American Railroads, this separate reporting requires the separation of costs that are already integrated into other assets and maintenance costs, and so carving out PTC-related assets and expenses is challenging and requires allocations and estimates. As a result, this reporting of already-implemented expenditures is significantly time-consuming and expensive. Consistent with E.O. 14219 and in light of FRA's determination that PTC implementation is complete, the benefits of the PTC Supplement cost reporting no longer justify the burden and cost requiring that detailed information. Ending that reporting requirement would simplify the annual R-1 reports filed by Class I rail carriers. Any ongoing PTC-related expenditures would be reflected in the R-1 capital investment and expenses total. Therefore, under the Board's proposed modifications, Class I railroads would no longer be required to provide supplemental PTC data.
The proposal would also benefit rail shippers and stakeholders, by allowing them to better plan operations and make informed business decisions based on publicly available, real-time data, and their own analysis of performance trends over time. Class I carriers have reported similar information in other proceedings using a process that, to the Board's understanding,
Appraisal Subcommittee of the Federal Financial Institutions Examination Council.
Notice of special closed meeting.
The ASC will convene a Special Closed Meeting to discuss a personnel matter, pursuant to section 1104(b) of title XI (12 U.S.C. 3333(b)).
Enforcement and Compliance, International Trade Administration, Department of Commerce.
On September 15, 2025, the U.S. Court of International Trade (CIT) issued its final judgment in
Applicable September 25, 2025.
Faris Montgomery, AD/CVD Operations, Office VIII, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-1537.
On July 1, 2022, Commerce published its
Jiangsu Senmao
In its first remand redetermination, issued in October 2023, Commerce reconsidered the SVs used for certain inputs and recalculated Jiangsu Senmao's margin. Commerce further provided the documentation requested by the Court and additional explanation for Commerce's determination to revise the Brazilian SV for plywood.
In its second remand redetermination, issued in June 2024, Commerce addressed the CIT's ruling by further explaining record evidence demonstrating that two separate countries' SV data were viable and justifiable.
In its third remand redetermination, issued in May 2025, Commerce reconsidered its determination on SVs for plywood, replacing Brazilian data with Malaysian data for plywood. As a result of this analysis, Commerce revised Jiangsu Senmao's weighted-average dumping margin to 14.35 percent.
In its decision in
Because there is now a final court judgment, Commerce is amending its
Because Jiangsu Senmao has a superseding cash deposit rate,
At this time, Commerce remains enjoined by CIT order from liquidating entries that were exported by Jiangsu Senmao, and were entered, or withdrawn from warehouse, for consumption during the period from 12/01/2019 through 11/30/2020. These entries will remain enjoined pursuant to the terms of the injunction during the pendency of any appeals process.
In the event the CIT's ruling is not appealed, or, if appealed, upheld by a final and conclusive court decision, Commerce intends to instruct CBP to assess antidumping duties on unliquidated entries of subject merchandise exported by Jiangu Senmao in accordance with 19 CFR 351.212(b). We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review when the importer-specific
This notice is issued and published in accordance with sections 516A(c) and (e) and 777(i)(1) of the Act.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The U.S. Department of Commerce (Commerce) determines that countervailable subsidies are being provided to producers and exporters of thermoformed molded fiber products (molded fiber products) from the People's Republic of China (China). The period of investigation (POI) is January 1, 2023, through December 31, 2023.
Applicable September 30, 2025.
Allison Hollander, AD/CVD Operations, Office IX, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-2805.
On March 14, 2025, Commerce published the
For a complete discussion of the events that followed the
The merchandise covered by the scope of this investigation is molded fiber products from China. For a complete description of the scope of this investigation,
During the course of this investigation, Commerce received scope comments from interested parties.
As provided in section 782(i) of the Act, in April 2025, Commerce verified the information reported by the Guangxi Firstpak Environmental Technology Co., Ltd. (Firstpak) and Zhejiang Zhongxin Environmental Protection Technology Group Co., Ltd. (Zhejiang Zhongxin) for use in our final determination. We used standard verification procedures, including an examination of relevant accounting records and original source documents provided at verification.
The subsidy programs under investigation and the issues raised in the case and rebuttal briefs that were submitted by interested parties in this investigation are discussed in the Issues and Decision Memorandum. For a list of the issues raised by interested parties and addressed in the Issues and Decision Memorandum,
Commerce conducted this investigation in accordance with section 701 of the Act. For each of the subsidy programs found to be countervailable, Commerce determines that there is a subsidy,
In making this final determination, Commerce relied, in part, on facts otherwise available, including with an adverse inference, pursuant to sections 776(a) and (b) of the Act. For a full discussion of our application of adverse facts available (AFA),
Based on our review and analysis of the information at verification and comments received from interested parties, we made changes to the subsidy rate calculations for Firstpak, Zhejiang Zhongxin, and for all other producers/exporters, including the addition of subsidy programs included in the Post-Preliminary Analysis. For a discussion of these changes,
Section 705(c)(5)(A) of the Act provide that Commerce shall determine an estimated all-others rate for companies not individually examined. This rate shall be an amount equal to the weighted average of the estimated subsidy rates established for those companies individually examined, excluding any zero and
In this investigation, Commerce preliminarily calculated individual estimated countervailable subsidy rates for Firstpak and Zhejiang that are not zero,
Commerce determines that the following estimated countervailable subsidy rates exist for the period January 1, 2023, through December 31, 2023:
As a result of our
If the U.S. International Trade Commission (ITC) issues a final affirmative injury determination, we will issue a CVD order, reinstate the suspension of liquidation under section 706(a) of the Act, and require a cash deposit of estimated countervailing duties for entries of subject merchandise in the amounts indicated above. Pursuant to section 705(c)(2) of the Act, if the ITC determines that material injury, or threat of material injury, does not exist, this proceeding will be terminated, and all estimated duties deposited or securities posted as a result of the suspension of liquidation will be refunded or cancelled.
In accordance with section 705(d) of the Act, Commerce will notify the ITC of its final affirmative determination that countervailable subsidies are being provided to producers and exporters of molded fiber products from China. As Commerce's final determination is affirmative, in accordance with section 705(b) of the Act, the ITC will determine, within 45 days, whether the domestic industry in the United States is materially injured, or threatened with material injury, by reason of import of molded fiber products from China. In addition, we are making available to the ITC all non-privileged and non-proprietary information in our files, provided the ITC confirms that it will not disclose such information, either publicly or under administrative protective order (APO), without the written consent of the Assistant Secretary for Enforcement and Compliance.
If the ITC determines that material injury or threat of material injury does not exist, this proceeding will be terminated, and all cash deposits will be refunded. If the ITC determines that such injury does exist, Commerce will issue a CVD order directing CBP to assess, upon further instruction by Commerce, countervailing duties on all imports of the subject merchandise that are entered, or withdrawn from warehouse, for consumption on or after the effective date of the suspension of liquidation, as discussed above in the “Continuation of Suspension of Liquidation” section.
This notice will serve as the final reminder to parties subject to an APO of their responsibility concerning the destruction of proprietary information disclosed under APO, in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a violation which is subject to sanction.
This determination is issued and published in accordance with sections 705(d) and 777(i) of the Act, and 19 CFR 351.210(c).
The merchandise subject to this investigation consists of thermoformed molded fiber products regardless of shape, form, function, fiber source, or finish. Thermoformed molded fiber products are formed with cellulose fibers, thermoformed using one or more heated molds, and dried/cured in the mold.
Thermoformed molded fiber products include, but are not limited to, plates, bowls, clamshells, trays, lids, food or foodservice contact packaging, and consumer or other product packaging.
Thermoformed molded fiber products are relatively dense, with a typical fiber density above 0.5 grams per cubic centimeter, and are generally characterized by relatively smooth surfaces. They may be derived from any virgin or recycled cellulose fiber source (including, but not limited to, those sourced
Thermoformed molded fiber products remain covered by the scope of this investigation if the subject product is encased by exterior packaging. They also remain covered by the scope of this investigation whether imported alone, or in any combination of subject and non-subject merchandise (
Also excluded from the scope of this investigation are products covered by the scope of the antidumping and countervailing duty orders on paper plates from People's Republic of China, the Kingdom of Thailand, and the Socialist Republic of Vietnam.
Excluded from the scope of this investigation are thermoformed molded fiber products imported as packaging material that enclose and/or surround non-subject merchandise prepackaged for final sale upon importation into the United States (
Thermoformed molded fiber products include thermoformed molded fiber products matching the above description that have been finished, packaged, or otherwise processed in a third country by performing finishing, packaging, or processing that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the thermoformed molded fiber products. Examples of finishing, packaging, or other processing in a third country that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the thermoformed molded fiber products include, but are not limited to, hot or after pressing, die-cutting, punching, trimming, padding, perforating, printing, labeling, dying, coloring, coating, laminating, embossing, debossing, repacking, or denesting.
Thermoformed molded fiber products are classified under subheadings 4823.70.0020 and 4823.70.0040, Harmonized Tariff Schedule of the United States (HTSUS). Imports may also be classified under subheadings 4823.61.0020, 4823.61.0040, 4823.69.0020, 4823.69.0040, 4823.90.1000, HTSUS. References to the HTSUS classification are provided for convenience and customs purposes, and the written description of the merchandise under investigation is dispositive.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Applicable September 30, 2025.
Robert Hedberg and Amber Hodak, AD/CVD Operations, Office VI, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-0955 or (202) 482-8034, respectively.
On May 21, 2025, the U.S. Department of Commerce (Commerce) initiated the countervailing duty (CVD) investigation of silicon metal from the Kingdom of Thailand (Thailand).
On September 23, 2025, in accordance with section 705(a)(1) of the Tariff Act of 1930, as amended (the Act), Ferroglobe USA, Inc. and Mississippi Silicon LLC (the petitioners) timely requested an alignment of the final CVD determination with the final LTFV determinations of silicon metal from Angola and the Lao People's Democratic Republic.
This notice is issued and published pursuant to section 705(a)(1) of the Act and 19 CFR 351.210(b)(4)(i).
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Applicable September 30, 2025.
Kelsie Hohenberger, AD/CVD Operations, Office V, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-2517.
On August 19, 2025, the U.S. Department of Commerce (Commerce) initiated a countervailing duty (CVD) investigation of imports of unwrought palladium from the Russian Federation.
Section 703(b)(1) of the Tariff Act of 1930, as amended (the Act), requires Commerce to issue the preliminary determination in a CVD investigation within 65 days after the date on which Commerce initiated the investigation. However, section 703(c)(1) of the Act permits Commerce to postpone the preliminary determination until no later than 130 days after the date on which Commerce initiated the investigation if: (A) the petitioner makes a timely request for a postponement; or (B) Commerce concludes that the parties concerned are cooperating, that the investigation is extraordinarily complicated, and that additional time is necessary to make a preliminary determination. Under 19 CFR 351.205(e), the petitioner must submit a request for postponement 25 days or more before the scheduled date of the preliminary determination and must state the reasons for the request. Commerce will grant the request unless it finds compelling reasons to deny the request.
On September 3, 2025, the petitioners
This notice is issued and published in accordance with sections 703(c)(2) of the Act and 19 CFR 351.205(f)(1).
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The U.S. Department of Commerce (Commerce) determines that thermoformed molded fiber products (molded fiber products) from the Socialist Republic of Vietnam (Vietnam) are being, or are likely to be, sold in the United States at less than fair value (LTFV). The period of investigation (POI) is April 1, 2024, through September 30, 2024.
Applicable September 30, 2025.
Zachary Shaykin, AD/CVD Operations, Office IV, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-2638.
On May 6, 2025, Commerce published in the
A summary of the events that occurred since the
The products covered by this investigation are molded fiber products from Vietnam. For a complete description of the scope of this investigation,
In the Preliminary Scope Memorandum, we set aside a period of time for parties to raise issues regarding product coverage (
Commerce conducted verification of the information relied upon in making its final determination in this investigation, in accordance with section 782(i) of the Tariff Act of 1930, as amended (the Act). Specifically, we conducted on-site verification of the sales and cost information submitted by Vietnam Yuzhan Packaging Technology Company Limited (Yuzhan), for use in our final determination.
The issues raised in the case and rebuttal briefs by the parties in this investigation are discussed in the Issues and Decision Memorandum. For a list of the issues raised by interested parties and addressed in the Issues and Decision Memorandum,
We made certain changes to the margin calculations for Yuzhan since the
As discussed in the
No parties commented on Commerce's preliminary separate rate determination. Therefore, we have not made any changes regarding our determination of companies eligible to receive a separate rate. Accordingly, we continue to find that Yuzhan and certain non-individually examined companies that are listed in the “Final Determination” rate table, below, are eligible for a separate.
Consistent with the
Commerce determines that the following estimated weighted-average dumping margins exist:
Commerce intends to disclose the calculations performed in connection with this final determination to interested parties within five days after public announcement or, if there is no public announcement, within five days of the date of publication of this notice in the
In accordance with section 735(c)(1)(B) of the Act, we will instruct U.S. Customs and Border Protection (CBP) to continue to suspend liquidation of subject merchandise entries, as described in Appendix I of this notice, which are entered, or withdrawn from warehouse, for consumption on or after May 12, 2025, the date of publication of the
Pursuant to section 735(c)(1)(B)(ii) of the Act and 19 CFR 351.210(d), Commerce will instruct CBP to require a cash deposit equal to the amount by which the normal value exceeds the U.S. price as follows: (1) the cash deposit rate for the exporter/producer combination listed in the table above will be the rate identified in the table; (2) for all combination of Vietnamese exporters/producers of subject merchandise that have not received their own separate rate above, the cash deposit rate will be the cash deposit rate established for the Vietnam-wide entity; and (3) for all non-Vietnamese exporters of subject merchandise which have not received their own separate rate above, the cash deposit rate will be the cash deposit rate applicable to the Vietnamese exporter/producer combination that supplied that non-Vietnamese exporter. These suspension of liquidation instructions will remain in effect until further notice.
To determine the cash deposit rate, Commerce normally adjusts the estimated weighted-average dumping margin by the amount of export subsidies countervailed in a companion CVD investigation, when CVD provisional measures are in effect. Accordingly, where Commerce made an affirmative determination for countervailable export subsidies, Commerce would offset the estimated weighted-average dumping margins by the appropriate export subsidy rate. Any such adjusted cash deposit rates may be found in the “Final Determination” section above. However, the suspension of liquidation of provisional measures in the companion CVD investigation has been discontinued.
In accordance with section 735(d) of the Act, Commerce will notify the ITC of its final affirmative determination of sales at LTFV. Because Commerce's final determination is affirmative, in accordance with section 735(b)(2) of the Act, the ITC will make its final determination as to whether the domestic industry in the United States is materially injured, or threatened with material injury, by reason of imports of molded fiber products no later than 45 days after this final determination. If the ITC determines that material injury or threat of material injury does not exist, the proceeding will be terminated and all cash deposits will be refunded or canceled, and suspension of liquidation will be lifted. If the ITC determines that such injury does exist, Commerce will issue an antidumping duty order directing CBP to assess, upon further instructions by Commerce, antidumping duties on all imports of the subject merchandise that are entered, or withdrawn from warehouse, for consumption on or after the effective date of the suspension of liquidation, as discussed above in the “Continuation of Suspension of Liquidation” section above.
This notice also serves as the only reminder to parties subject to an APO of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a sanctionable violation.
This determination is issued and published in accordance with sections 733(d) and 777(i) of the Act, and 19 CFR 351.210(c).
The merchandise subject to this investigation consists of thermoformed molded fiber products regardless of shape, form, function, fiber source, or finish. Thermoformed molded fiber products are formed with cellulose fibers, thermoformed
Thermoformed molded fiber products include, but are not limited to, plates, bowls, clamshells, trays, lids, food or foodservice contact packaging, and consumer or other product packaging.
Thermoformed molded fiber products are relatively dense, with a typical fiber density above 0.5 grams per cubic centimeter, and are generally characterized by relatively smooth surfaces. They may be derived from any virgin or recycled cellulose fiber source (including, but not limited to, those sourced from wood, woody crops, agricultural crops/byproducts/residue, and agricultural/industrial/other waste). They may have any weight, shape, dimensionality, design, or size, and may be bleached, unbleached, dyed, colored, or printed. They may include ingredients, additives, or chemistries to enhance functionality including, but not limited to, anti-microbial, anti-fungal, anti-bacterial, heat/flame resistant, hydrophobic, oleophobic, absorbent, or adsorbent. Thermoformed molded fiber products may also be subject to other processing or treatments, including, but not limited to, hot or after pressing, die-cutting, punching, trimming, padding, perforating, printing, labeling, dying, coloring, coating, laminating, embossing, debossing, repacking, or denesting. Thermoformed molded fiber products subject to this investigation may also have additional design features, including, but not limited to, tab closures, venting, channeling, or stiffening.
Thermoformed molded fiber products remain covered by the scope of this investigation if the subject product is encased by exterior packaging. They also remain covered by the scope of this investigation whether imported alone, or in any combination of subject and non-subject merchandise (
Also excluded from the scope of this investigation are products covered by the scope of the antidumping and countervailing duty orders on paper plates from People's Republic of China, the Kingdom of Thailand, and the Socialist Republic of Vietnam.
Excluded from the scope of this investigation are thermoformed molded fiber products imported as packaging material that enclose and/or surround non-subject merchandise prepackaged for final sale upon importation into the United States (
Thermoformed molded fiber products include thermoformed molded fiber products matching the above description that have been finished, packaged, or otherwise processed in a third country by performing finishing, packaging, or processing that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the thermoformed molded fiber products. Examples of finishing, packaging, or other processing in a third country that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the thermoformed molded fiber products include, but are not limited to, hot or after pressing, die-cutting, punching, trimming, padding, perforating, printing, labeling, dying, coloring, coating, laminating, embossing, debossing, repacking, or denesting.
Thermoformed molded fiber products are classified under subheadings 4823.70.0020 and 4823.70.0040, Harmonized Tariff Schedule of the United States (HTSUS). Imports may also be classified under subheadings 4823.61.0020, 4823.61.0040, 4823.69.0020, 4823.69.0040, 4823.90.1000, HTSUS. References to the HTSUS classification are provided for convenience and customs purposes, and the written description of the merchandise under investigation is dispositive.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Applicable September 30, 2025.
Benjamin Blythe or Joshua Jacobson, Office IV, AD/CVD Operations, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230, telephone: (202) 482-3457 and (202) 482-0266, respectively.
On August 12, 2025, the U.S. Department of Commerce (Commerce) initiated a countervailing duty (CVD) investigation of imports of certain freight rail couplers and parts thereof (freight rail couplers) from India.
Section 703(b)(1) of the Tariff Act of 1930, as amended (the Act), requires Commerce to issue the preliminary determination in a CVD investigation within 65 days after the date on which Commerce initiated the investigation. However, section 703(c)(1) of the Act permits Commerce to postpone the preliminary determination in a CVD investigation until no later than 130 days after the date on which Commerce initiated the investigation if: (A) the petitioner makes a timely request for a postponement; or (B) Commerce concludes that the parties concerned are cooperating, that the investigation is extraordinarily complicated, and that additional time is necessary to make a preliminary determination. Under 19 CFR 351.205(e), the petitioner must submit a request for postponement 25 days or more before the scheduled date of the preliminary determination and must state the reasons for the request. Commerce will grant the request unless it finds compelling reasons to deny the request.
On September 22, 2025, the petitioner
In accordance with 19 CFR 351.205(e), the petitioner submitted its request for postponement of the preliminary determination in this investigation 25 days or more before the scheduled date of the preliminary determination and stated the reasons for its request. Commerce finds no compelling reason to deny the request. Therefore, in accordance with section 703(c)(1)(A) of the Act, Commerce is postponing the deadline for the preliminary determination in the investigation to no later than 130 days after the date on which this investigation was initiated,
This notice is issued and published pursuant to section 703(c)(2) of the Act and 19 CFR 351.205(f)(1).
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Based on a request from Nextracker LLC (Nextracker), the U.S. Department of Commerce (Commerce) is initiating and issuing preliminary results of changed circumstances reviews (CCRs) of the antidumping duty (AD) and countervailing duty (CVD) orders on crystalline silicon photovoltaic cells (solar cells), whether or not assembled into modules, from the People's Republic of China (China) to revoke the orders, in part, with respect to certain products. Interested parties are invited to comment on these preliminary results.
Applicable September 30, 2025.
Maureen Shaheen, Acting Director, Office of Antidumping Policy, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-3004.
On December 7, 2012, Commerce published the AD and CVD orders on solar cells from China.
On June 30, 2025, the American Alliance for Solar Manufacturing (the petitioner), filed a letter of no opposition to Nextracker's CCR Request.
The merchandise covered by these
These
Merchandise under consideration may be described at the time of importation as parts for final finished products that are assembled after importation, including, but not limited to, modules, laminates, panels, building-integrated modules, building-integrated panels, or other finished goods kits. Such parts that otherwise meet the definition of merchandise under consideration are included in the scope of this order.
Excluded from the scope of these
Also excluded from the scope of these
Modules, laminates, and panels produced in a third-country from cells produced in the PRC are covered by these
Merchandise covered by these
The products subject to the proposed partial revocation are Off-grid solar cells panels for dedicated powering of a single low-voltage device (60Vdc or less) that:
1. Have a glass cover;
2. Have an aluminum frame around the edges of each panel;
3. Have a total power output of 140 watts or less per panel;
4. Are of an elongated rectangular shape such that the long side is at least 3.5 times the length of the short side;
5. Have a surface area of less than 8,200 cm2 per panel;
6. Connect to device with 12-16 American Wire Gauge wires between 1200 mm and 1310 mm in length; and
7. Do not include a built-in inverter.
Pursuant to section 751(b)(1) of the Act, Commerce will conduct a CCR upon receipt of a request from an interested party that shows changed circumstances sufficient to warrant a review of the order. In accordance with 19 CFR 351.216(d), Commerce determines that the information submitted by Nextracker, along with substantially all of the domestic industry's support, shows changed circumstances sufficient to warrant a review of the
Section 351.221(c)(3)(ii) of Commerce's regulations permits Commerce to combine the notice of initiation of a CCR and the notice of preliminary results if Commerce concludes that expedited action is warranted.
Pursuant to section 751(d)(1) of the Act, and 19 CFR 351.222(g), Commerce may revoke an AD or CVD order, in whole or in part, based on a review under section 751(b) of the Act (
As explained above, domestic solar cells producers, including the original petitioner and four other domestic solar cells producers, have expressed no interest in opposing Nextracker's CCR Request.
In the absence of any other interested party comments addressing the issue of domestic industry support, we preliminarily conclude that producers accounting for substantially all of the production of the domestic like product to which the
In accordance with 19 CFR 351.309(c)(1)(ii), interested parties may submit case briefs no later than 14 days after the date of publication of this notice.
As provided under 19 CFR 351.309(c)(2) and (d)(2), in prior proceedings we have encouraged interested parties to provide an executive summary of their brief that should be limited to five pages total, including footnotes. In these CCRs, we instead request that interested parties provide at the beginning of their briefs a public, executive summary for each issue raised in their briefs.
Unless extended, consistent with 19 CFR 351.216(e), Commerce intends to issue the final results of these CCRs no later than 270 days after the date on which these reviews were initiated or 45 days if all parties agree to the outcome of the reviews. If, in the final results of these reviews, Commerce continues to determine that changed circumstances warrant the revocation of the
This initiation notice and preliminary results are published in accordance with section 751(b)(1) of the Act, 19 CFR 351.221(b)(1), and 19 CFR 351.221(c)(3)(ii).
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The U.S. Department of Commerce (Commerce) is conducting an administrative review of the antidumping (AD) order on raw honey from Brazil for the period of review (POR) June 1, 2023, through May 31, 2024. Commerce preliminarily finds that Melbras Importadora E Exportadora Agroindústria Ltda. (Melbras) and Minamel Agroindústria Ltda. (Minamel) made sales of subject merchandise at prices below normal value (NV) during the POR. Additionally, we are rescinding this review, in part, with respect to certain companies for which there were no reviewable entries of subject merchandise during the POR, and for which requests for review were timely withdrawn. We invite interested parties to comment on these preliminary results.
Applicable September 30, 2025.
John Frye or Braeden Lowe, AD/CVD Operations, Office V, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-3035 or (202) 482-2000, respectively.
On July 29, 2024, Commerce initiated an administrative review of the antidumping duty (AD) order on raw honey from Brazil, in accordance with section 751(a) of the Tariff Act of 1930, as amended (the Act).
On December 9, 2024, Commerce tolled certain deadlines in this administrative proceeding by 90 days
The product covered by the scope of this
Pursuant to 19 CFR 351.213(d)(1), Commerce will rescind an administrative review, in whole or in part, if a party that requested a review withdraws the request within 90 days of the date of publication of the initiation of the requested review. Because interested parties timely withdrew all review requests for Apis Nativa Agroindustrial Exportadora Ltda (Apis Nativa), we are rescinding this review, in part, with respect to Apis Nativa.
Additionally, pursuant to 19 CFR 351.213(d)(3), when there are no reviewable entries of subject merchandise during the POR subject to the AD order for which liquidation is suspended, Commerce may rescind an administrative review, in whole or only with respect to a particular exporter or producer.
Accordingly, pursuant to 19 CFR 351.213(d)(1), (3), and (4), we are rescinding this administrative review, in part, with respect to Apis Nativa and the seven additional companies listed in Appendix III to this notice that had no reviewable, suspended entries of subject merchandise during the POR.
Commerce is conducting this review in accordance with section 751(a) of the Act. We calculated export price and constructed export price in accordance with sections 772(a) and 772(b) of the Act, respectively. We calculated NV in accordance with section 773 of the Act.
For a full description of the methodology underlying these preliminary results,
The Act and Commerce's regulations do not address the establishment of a rate to be applied to companies not selected for examination when Commerce limits its examination in an administrative review pursuant to section 777A(c)(2) of the Act. Generally, Commerce looks to section 735(c)(5) of the Act, which provides instructions for calculating the all-others rate in a market economy investigation, for guidance when calculating the rate for companies which were not selected for individual examination in an administrative review. Under section 735(c)(5)(A) of the Act, the all-others rate is normally “an amount equal to the weighted average of the estimated weighted-average dumping margins established for exporters and producers individually investigated, excluding any zero and
We preliminarily calculated weighted-average dumping margins for Melbras and Minamel that are not zero,
Commerce preliminarily determines that the following weighted-average dumping margins exist for the period June 1, 2023, through May 31, 2024:
Commerce
Case briefs or other written comments may be submitted to the Assistant Secretary for Enforcement and Compliance.
As provided under 19 CFR 351.309(c)(2) and (d)(2), in prior proceedings we have encouraged interested parties to provide an executive summary of their briefs that should be limited to five pages total, including footnotes. In this review, we instead request that interested parties provide at the beginning of their briefs a public, executive summary for each issue raised in their briefs.
Pursuant to 19 CFR 351.310(c), interested parties who wish to request a hearing must submit a written request to the Assistant Secretary for Enforcement and Compliance, U.S. Department of Commerce, within 30 days after the date of publication of this notice. Requests should contain: (1) the party's name, address, and telephone number; (2) the number of participants and whether any participant is a foreign national; and (3) a list of the issues to be discussed. Issues raised in the hearing will be limited to those raised in the respective case briefs. Oral presentations at the hearing will be limited to issues raised in the briefs. If a request for a hearing is made, parties will be notified of the time and date for the hearing.
All submissions, including case and rebuttal briefs, as well as hearing requests, should be filed via ACCESS.
Upon completion of the final results of this administrative review, Commerce shall determine, and CBP shall assess, antidumping duties on all appropriate entries covered by this review. If a respondent's weighted-average dumping margin is not zero or
In accordance with Commerce's “automatic assessment” practice, for entries of subject merchandise during the POR produced by Melbras or Minamel for which these companies did not know that the merchandise was destined for the United States, we will instruct CBP to liquidate those entries at the all-others rate established in the amended final of the original less-than-fair-value (LTFV) investigation (
For the companies listed in Appendix II which were not selected for individual examination, we will assign an assessment rate based on the review-specific rate, calculated as noted in the “Rate for Companies Not Individually Examined” section, above. The final results of this review shall be the basis for the assessment of antidumping duties on entries of merchandise covered by the final results of this review and for future deposits of estimated duties, where applicable.
For the companies listed in Appendix III for which the review is rescinded, we will instruct CBP to assess antidumping duties on any suspended entries that entered under their CBP case numbers (
Commerce intends to issue assessment instructions to CBP no earlier than 35 days after the publication date of the final results of this review in the
The following cash deposit requirements will be effective for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, as provided by 751(a)(2)(C) of the Act: (1) the cash deposit rate for the companies listed in the final results of this review will be equal to the weighted-average dumping margins established in the final results of this review, except if the rate is less than 0.50 percent and, therefore,
Unless otherwise extended, Commerce intends to issue the final results of this administrative review, including the results of its analysis of the issues raised in any written briefs, no later than 120 days after the date of publication of this notice, pursuant to section 751(a)(3)(A) of the Act and 19 CFR 351.213(h)(1).
This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to the liquidation of the relevant entries during the POR. Failure to comply with this requirement could result in Commerce's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.
Commerce is issuing and publishing these preliminary results in accordance with sections 751(a)(1) and 777(i) of the Act, and 19 CFR 351.213(h)(2) and 351.221(b)(4).
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The U.S. Department of Commerce (Commerce) determines that thermoformed molded fiber products (molded fiber products) from the People's Republic of China (China) are being, or are likely to be, sold in the United States at less than fair value (LTFV) during the period of investigation (POI) April 1, 2025, through September 30, 2025.
Applicable September 30, 2025.
Dennis McClure or Matthew Lipka, AD/CVD Operations, Office VIII, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-5973, or (202) 482-7976, respectively.
On May 12, 2025, Commerce published the
The Issues and Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at
The products covered by this investigation are molded fiber products from China. For a complete description of the scope of this investigation,
In the Preliminary Scope Memorandum, we set aside a period of time for parties to raise issues regarding product coverage (
As provided in section 782(i) of the Tariff Act of 1930, as amended (the Act), between June 11 and 19, 2025, Commerce conducted verification of the sales and factors of production information submitted by Guangxi Firstpak Environmental Technology Co., Ltd. (Guangxi Firstpak) and the Zhongxin Group.
The issues raised in the case and rebuttal briefs by the parties in this investigation are discussed in the Issues and Decision Memorandum. For a list of the issues raised by interested parties and addressed in the Issues and Decision Memorandum,
Based on a review of the record and analysis of the information received during verification and comments received from interested parties for this final determination, we made certain changes to the estimated weighted-average dumping margins for Guangxi Firsptak and Zhejiang Zhongxin and made certain changes to the names included in combination rates for two separate rate companies. For a discussion of these changes,
Consistent with the
No interested parties commented on Commerce's preliminary separate rate determinations,
Consistent with the
Commerce determines that the following estimated weighted-average dumping margins exist for the period April 1, 2024, through September 30, 2024:
Commerce intends to disclose the calculations performed in connection with this final determination within five days of any public announcement or, if there is no public announcement, within five days of the date of publication of this notice in the
In accordance with section 735(c)(1)(B) of the Act, we will instruct U.S. Customs and Border Protection (CBP) to continue to suspend liquidation of subject merchandise entries, as described in Appendix I of this notice, which are entered, or withdrawn from warehouse, for consumption on or after May 12, 2025, the date of publication of the
Pursuant to section 735(c)(1)(B)(ii) of the Act and 19 CFR 351.210(d), upon the publication of this notice, Commerce will instruct CBP to require a cash deposit for estimated antidumping duties for appropriate entries: (1) for the producer/exporter combinations listed in the table above, the applicable cash deposit rate is listed in the table for that combination; (2) for all combinations of Chinese producers/exporters of the merchandise under consideration that have not established eligibility for a separate rate, the cash deposit rate will be equal to the cash deposit rate listed for the China-wide entity in the table above; and (3) for all third-country exporters of the merchandise under consideration that are not listed in the table above, the cash deposit rate is the cash deposit rate applicable to the Chinese producer/exporter combination or the China-wide entity that supplied that third-country exporter. These suspension of liquidation instructions will remain in effect until further notice.
To determine the antidumping duty cash deposit rate, Commerce normally adjusts the estimated weighted-average dumping margin by the amount of domestic subsidy pass-through and export subsidies determined in a companion countervailing duty (CVD) proceeding. In the companion CVD final determination, Commerce determined export subsidy rates exist for Guangxi Firstpak, and the Zhongxin Group.
In accordance with section 735(d) of the Act, we will notify the ITC of this final affirmative determination of sales at LTFV. Because the final determination in this investigation is affirmative, in accordance with section 735(b)(2) of the Act, the ITC will make its final determination as to whether the domestic industry in the United States is materially injured, or threatened with material injury, by reason of imports of molded fiber products no later than 45 days after this final determination. In addition, we are making available to the ITC all nonprivileged and nonproprietary information related to this investigation.
If the ITC determines that material injury or threat of material injury does not exist, the proceeding will be terminated and all cash deposits will be refunded or canceled, and suspension of liquidation will be lifted. If the ITC determines that such injury does exist, Commerce will issue an antidumping duty order directing CBP to assess, upon further instructions by Commerce, antidumping duties on all imports of the subject merchandise that are entered, or withdrawn from warehouse, for consumption on or after the effective date of the suspension of liquidation, as discussed above in the “Continuation of Suspension of Liquidation” section above.
This notice also serves as the only reminder to parties subject to an APO of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a sanctionable violation.
This determination and this notice are issued and published pursuant to sections 735(d) and 777(i)(1) of the Act, and 19 CFR 351.210(c).
The merchandise subject to this investigation consists of thermoformed molded fiber products regardless of shape, form, function, fiber source, or finish. Thermoformed molded fiber products are formed with cellulose fibers, thermoformed using one or more heated molds, and dried/cured in the mold.
Thermoformed molded fiber products include, but are not limited to, plates, bowls, clamshells, trays, lids, food or foodservice contact packaging, and consumer or other product packaging.
Thermoformed molded fiber products are relatively dense, with a typical fiber density above 0.5 grams per cubic centimeter, and are generally characterized by relatively smooth surfaces. They may be derived from any virgin or recycled cellulose fiber source (including, but not limited to, those sourced from wood, woody crops, agricultural crops/byproducts/residue, and agricultural/industrial/other waste). They may have any weight, shape, dimensionality, design, or size, and may be bleached, unbleached, dyed, colored, or printed. They may include ingredients, additives, or chemistries to enhance functionality including, but not limited to, anti-microbial, anti-fungal, anti-bacterial, heat/flame resistant, hydrophobic, oleophobic, absorbent, or adsorbent. Thermoformed molded fiber products may also be subject to other processing or treatments, including, but not limited to, hot or after pressing, die-cutting, punching, trimming, padding, perforating, printing, labeling, dying, coloring, coating, laminating, embossing, debossing, repacking, or denesting. Thermoformed molded fiber products subject to this investigation may also have additional design features, including, but not limited to, tab closures, venting, channeling, or stiffening.
Thermoformed molded fiber products remain covered by the scope of this investigation if the subject product is encased by exterior packaging. They also remain covered by the scope of this investigation whether imported alone, or in any combination of subject and non-subject merchandise (
Also excluded from the scope of this investigation are products covered by the scope of the antidumping and countervailing duty orders on paper plates from People's Republic of China, the Kingdom of Thailand, and the Socialist Republic of Vietnam.
Excluded from the scope of this investigation are thermoformed molded fiber products imported as packaging material that enclose and/or surround non-subject merchandise prepackaged for final sale upon importation into the United States (
Thermoformed molded fiber products include thermoformed molded fiber products matching the above description that have been finished, packaged, or otherwise processed in a third country by performing finishing, packaging, or processing that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the thermoformed molded fiber products. Examples of finishing, packaging, or other processing in a third country that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the thermoformed molded fiber products include, but are not limited to, hot or after pressing, die-cutting, punching, trimming, padding, perforating, printing, labeling, dying, coloring, coating, laminating, embossing, debossing, repacking, or denesting.
Thermoformed molded fiber products are classified under subheadings 4823.70.0020 and 4823.70.0040, Harmonized Tariff Schedule of the United States (HTSUS). Imports may also be classified under subheadings 4823.61.0020, 4823.61.0040, 4823.69.0020, 4823.69.0040, 4823.90.1000, HTSUS. References to the HTSUS classification are provided for convenience and customs purposes, and the written description of the merchandise under investigation is dispositive.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The U.S. Department of Commerce (Commerce) determines that countervailable subsidies are being provided to producers and exporters of thermoformed molded fiber products (molded fiber products) from the Socialist Republic of Vietnam (Vietnam) during the period of investigation (POI), January 1, 2023, through December 31, 2023.
Applicable September 30, 2025.
Thomas Martin, AD/CVD Operations, Office IV, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-3936.
On March 14, 2025, Commerce published the
The merchandise covered by the scope of this investigation is molded fiber products from Vietnam. For a complete description of the scope of this investigation,
During the course of this investigation, Commerce received scope comments from interested parties.
As provided in section 782(i) of the Act, Commerce conducted verification of the information relied upon in making its final determination in this investigation. Specifically, we conducted on-site verifications of the subsidy information reported by Vietnam Yuzhan Packaging Technology Company Limited (Yuzhan) and Government of the Socialist Republic of Vietnam (GOV) in July and August 2025 using standard verification procedures, including an examination of relevant sales and accounting records, and original source documents provided by Yuzhan and the GOV.
The subsidy programs under investigation, and the issues raised in the case and rebuttal briefs that were submitted by parties in this investigation, are discussed in the Issues and Decision Memorandum. For a list of the issues raised by parties, and to which we responded in the Issues and Decision Memorandum,
Commerce conducted this investigation in accordance with section 701 the Act. For each of the subsidy programs found to be countervailable, Commerce determines that there is a subsidy,
In making this final determination, Commerce relied, in part, on facts available, including adverse facts available (AFA), pursuant to sections 776(a) and (b) of the Act. For a full discussion of our application of AFA,
Commerce preliminarily determined, in accordance with section 703(e)(1) of the Act and 19 CFR 351.206(c)(1), that critical circumstances exist with respect to imports of molded fiber products produced and/or exported by Yuzhan,
Based on our review and analysis of the information received during verification, our post-preliminary analysis, and comments received from parties, for this final determination, we made certain changes to the countervailable subsidy rate calculations for Yuzhan, HC Packaging Asia (Industrial Park), Honha Eco Pulp Viet Nam Paper Tray, Pulp Tray Martin Vietnam Co. Ltd., and all other producers/exporters. For a discussion of these changes,
Pursuant to section 705(c)(5)(A)(i) of the Act, Commerce will determine an all-others rate equal to the weighted average countervailable subsidy rates established for those exporters and/or producers individually investigated, excluding any zero and
Commerce determines that the following estimated countervailable subsidy rates exist for the period January 1, 2023, through December 31, 2023:
Commerce intends to disclose its calculations and analysis performed to interested parties in this final determination within five days of its public announcement, or if there is no public announcement, within five days of the date of publication of this notice in the
As a result of our
If the U.S. International Trade Commission (ITC) issues a final affirmative injury determination, we will issue a CVD order, reinstate the suspension of liquidation under section 706(a) of the Act, and require a cash deposit of estimated countervailing duties for such entries of subject merchandise in the amounts indicated above, in accordance with section 706(a) of the Act. If the ITC determines that material injury, or threat of material injury, does not exist, this proceeding will be terminated, and all estimated duties deposited or securities posted as a result of the suspension of liquidation will be refunded or canceled.
In accordance with section 705(d) of the Act, Commerce will notify the ITC of its final affirmative determination that countervailable subsidies are being provided to producers and exporters of molded fiber products from Vietnam. Because the final determination is affirmative, in accordance with section 705(b) of the Act, the ITC will make its final determination as to whether the domestic industry in the United States is materially injured, or threatened with material injury, by reason of imports of molded fiber products from Vietnam no later than 45 days after this final determination. In addition, we are making available to the ITC all non-privileged and nonproprietary information related to this investigation. We will allow the ITC access to all privileged and business proprietary information in our files, provided the ITC confirms that it will not disclose such information, either publicly or under an administrative protective order (APO), without the written consent of the Assistant Secretary for Enforcement and Compliance. If the ITC determines that material injury or threat of material injury does not exist, this proceeding will be terminated and all cash deposits will be refunded.
If the ITC determines that such injury does exist, Commerce will issue a CVD order directing CBP to assess, upon further instruction by Commerce, countervailing duties on all imports of the subject merchandise that are entered, or withdrawn from warehouse,
In the event that the ITC issues a final negative injury determination, this notice will serve as the only reminder to parties subject to an APO of their responsibility concerning the destruction of proprietary information disclosed under APO, in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a violation which is subject to sanction.
This determination is issued and published pursuant to sections 705(d) and 777(i) of the Act, and 19 CFR 351.210(c).
The merchandise subject to this investigation consists of thermoformed molded fiber products regardless of shape, form, function, fiber source, or finish. Thermoformed molded fiber products are formed with cellulose fibers, thermoformed using one or more heated molds, and dried/cured in the mold.
Thermoformed molded fiber products include, but are not limited to, plates, bowls, clamshells, trays, lids, food or foodservice contact packaging, and consumer or other product packaging.
Thermoformed molded fiber products are relatively dense, with a typical fiber density above 0.5 grams per cubic centimeter, and are generally characterized by relatively smooth surfaces. They may be derived from any virgin or recycled cellulose fiber source (including, but not limited to, those sourced from wood, woody crops, agricultural crops/byproducts/residue, and agricultural/industrial/other waste). They may have any weight, shape, dimensionality, design, or size, and may be bleached, unbleached, dyed, colored, or printed. They may include ingredients, additives, or chemistries to enhance functionality including, but not limited to, anti-microbial, antifungal, anti-bacterial, heat/flame resistant, hydrophobic, oleophobic, absorbent, or adsorbent. Thermoformed molded fiber products may also be subject to other processing or treatments, including, but not limited to, hot or after pressing, die-cutting, punching, trimming, padding, perforating, printing, labeling, dying, coloring, coating, laminating, embossing, debossing, repacking, or denesting. Thermoformed molded fiber products subject to this investigation may also have additional design features, including, but not limited to, tab closures, venting, channeling, or stiffening.
Thermoformed molded fiber products remain covered by the scope of this investigation if the subject product is encased by exterior packaging. They also remain covered by the scope of this investigation whether imported alone, or in any combination of subject and non-subject merchandise (
Also excluded from the scope of this investigation are products covered by the scope of the antidumping and countervailing duty orders on paper plates from People's Republic of China, the Kingdom of Thailand, and the Socialist Republic of Vietnam.
Excluded from the scope of this investigation are thermoformed molded fiber products imported as packaging material that enclose and/or surround non-subject merchandise prepackaged for final sale upon importation into the United States (
Thermoformed molded fiber products include thermoformed molded fiber products matching the above description that have been finished, packaged, or otherwise processed in a third country by performing finishing, packaging, or processing that would not otherwise remove the merchandise from the scope of the investigations if performed in the country of manufacture of the thermoformed molded fiber products. Examples of finishing, packaging, or other processing in a third country that would not otherwise remove the merchandise from the scope of the investigations if performed in the country of manufacture of the thermoformed molded fiber products include, but are not limited to, hot or after pressing, die-cutting, punching, trimming, padding, perforating, printing, labeling, dying, coloring, coating, laminating, embossing, debossing, repacking, or denesting.
Thermoformed molded fiber products are classified under subheadings 4823.70.0020 and 4823.70.0040, Harmonized Tariff Schedule of the United States (HTSUS). Imports may also be classified under subheadings 4823.61.0020, 4823.61.0040, 4823.69.0020, 4823.69.0040, 4823.90.1000, HTSUS. References to the HTSUS classification are provided for convenience and customs purposes, and the written description of the merchandise under investigation is dispositive.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The U.S. Department of Commerce (Commerce) preliminarily determines that silicon metal from the Lao People's Democratic Republic (Laos) is being, or are likely to be, sold in the United States at less than fair value (LTFV). The period of investigation (POI) is April 1, 2024, through March 31, 2025. Interested parties are invited to comment on this preliminary determination.
Applicable September 30, 2025.
Ashley Cossaart, AD/CVD Operations, Office IX, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-0462.
This preliminary determination is made in accordance with section 733(b) of the Tariff Act of 1930, as amended (the Act). Commerce published the notice of initiation of this investigation on May 21, 2025.
The product covered by this investigation is silicon metal from Laos. For a complete description of the scope of this investigation,
In accordance with the
Commerce is conducting this investigation in accordance with section 731 of the Act. Pursuant to section 776(a) and (b) of the Act, Commerce has preliminarily relied upon the facts otherwise available with adverse inferences for Lao Silicon Co., Ltd. (Lao Silicon). For a full description of the methodology underlying the preliminary determination,
In the Petition,
Sections 733(d)(1)(A)(ii) and 735(c)(5)(A) of the Act provide that in the preliminary determination, Commerce shall determine an estimated all-others rate for all exporters and producers not individually examined. This rate shall be an amount equal to the weighted average of the estimated weighted-average dumping margins established for exporters and producers individually investigated, excluding any zero and
Pursuant to section 735(c)(5)(B) of the Act, if the estimated weighted-average dumping margins established for all exporters or producers individually examined are zero,
Commerce preliminarily determines that the following estimated weighted-average dumping margins exist:
In accordance with section 733(d)(2) of the Act, Commerce will direct U.S. Customs and Border Protection (CBP) to suspend liquidation of entries of subject merchandise, as described in Appendix I, entered, or withdrawn from warehouse, for consumption, as discussed below. Further, pursuant to section 733(d)(1)(B) of the Act and 19 CFR 351.205(d), Commerce will instruct CBP to require a cash deposit equal to the estimated weighted-average dumping margin or the estimated all-others rate, as follows: (1) the cash deposit rate for the company listed
Normally, Commerce discloses to interested parties the calculations performed in connection with a preliminary determination within five days of any public announcement or, if there is no public announcement, within five days of the date of publication of the notice of preliminary determination in the
Because the individually examined respondent in this investigation did not provide information requested by Commerce, and Commerce preliminarily determines the examined respondent to have been uncooperative, we will not conduct verification.
Case briefs or other written comments may be submitted to the Assistant Secretary for Enforcement and Compliance no later than seven days after the date on which Commerce issues its post-preliminary analysis in this LTFV investigation. A timeline for the submission of case briefs and written comments will be provided to interested parties at a later date. Rebuttal briefs, limited to issues raised in the case briefs, may be filed not later than five days after the date for filing case briefs.
As provided under 19 CFR 351.309(c)(2) and (d)(2), in prior proceedings we have encouraged interested parties to provide an executive summary of their brief that should be limited to five pages total, including footnotes. In this investigation, we instead request that interested parties provide at the beginning of their briefs a public, executive summary for each issue raised in their briefs.
Pursuant to 19 CFR 351.310(c), interested parties who wish to request a hearing, limited to issues raised in the case and rebuttal briefs, must submit a written request to the Assistant Secretary for Enforcement and Compliance, U.S. Department of Commerce, within 30 days after the date of publication of this notice. Requests should contain the party's name, address, and telephone number, the number of participants, whether any participant is a foreign national, and a list of the issues to be discussed. If a request for a hearing is made, Commerce will inform parties of the time and date for the hearing. Parties should confirm by telephone the date, time, and location of the hearing two days before the scheduled date.
Section 735(a)(1) of the Act and 19 CFR 351.210(b)(1) provide that Commerce will issue the final determination within 75 days after the date of its preliminary determination. Accordingly, Commerce will make its final determination no later than 75 days after the signature date of this preliminary determination.
In accordance with section 733(f) of the Act, Commerce will notify the U.S. International Trade Commission (ITC) of its preliminary determination. If the final determination is affirmative, the ITC will determine before the later of 120 days after the date of this preliminary determination or 45 days after the final determination whether these imports are materially injuring, or threaten material injury to, the U.S. industry.
This determination is issued and published in accordance with sections 733(f) and 777(i)(1) of the Act, and 19 CFR 351.205(c).
The scope of this investigation covers all forms and sizes of silicon metal, including silicon metal powder. Silicon metal contains at least 85.00 percent but less than 99.99 percent silicon, and less than 4.00 percent iron, by actual weight. Semiconductor grade silicon (merchandise containing at least 99.99 percent silicon by actual weight and classifiable under Harmonized Tariff Schedule of the United States (HTSUS) subheading 2804.61.0000) is excluded from the scope of this investigation.
Silicon metal is currently classifiable under subheadings 2804.69.1000 and 2804.69.5000 of the HTSUS. While the HTSUS numbers are provided for convenience and customs purposes, the written description of the scope remains dispositive.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The U.S. Department of Commerce (Commerce) preliminarily determines that silicon metal (silicon) from Angola is being, or is likely to be, sold in the United States at less than fair value (LTFV). The period of investigation (POI) is April 1, 2024, through March 30, 2025. Interested parties are invited to comment on this preliminary determination.
Applicable September 30, 2025.
Christopher Doyle, AD/CVD Operations, Office IX, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-5882.
This preliminary determination is made in accordance with section 733(b) of the Tariff Act of 1930, as amended (the Act). Commerce published the notice of initiation of this investigation on May 21, 2025.
The product covered by this investigation is silicon metal from Angola. For a complete description of the scope of this investigation,
In accordance with the
Commerce is conducting this investigation in accordance with section 731 of the Act. Pursuant to section 776(a) and (b) of the Act, Commerce has preliminarily relied upon the facts otherwise available with adverse inferences for PC Silicon Co Limited (PC Silicon) and Wanhongda International Limited (Wanhongda). For a full description of the methodology underlying the preliminary determination,
In the Petition,
Sections 733(d)(1)(A)(ii) and 735(c)(5)(A) of the Act provide that in the preliminary determination, Commerce shall determine an estimated all-others rate for all exporters and producers not individually examined. This rate shall be an amount equal to the weighted average of the estimated weighted-average dumping margins established for exporters and producers individually investigated, excluding any zero and
Pursuant to section 735(c)(5)(B) of the Act, if the estimated weighted-average dumping margins established for all exporters or producers individually examined are zero,
Commerce preliminarily determines that the following estimated weighted-average dumping margins exist:
In accordance with section 733(d)(2) of the Act, Commerce will direct U.S. Customs and Border Protection (CBP) to suspend liquidation of subject merchandise as described Appendix I, entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice in the
Normally, Commerce discloses to interested parties the calculations performed in connection with a preliminary determination within five days of its public announcement or, if there is no public announcement, within five days of the date of publication of this notice in accordance with 19 CFR 351.224(b). However, because Commerce preliminarily applied AFA to certain producers or exporters of silicon metal in this investigation in accordance with section 776 of the Act, and the applied AFA rate is based solely on the Petition, there are no calculations to disclose.
As discussed in the Preliminary Decision Memorandum, because Commerce selected no mandatory respondents in this investigation, we will not conduct verification.
Case briefs or other written comments may be submitted to the Assistant Secretary for Enforcement and Compliance no later than seven days after the date on which Commerce issues its post-preliminary analysis in this LTFV investigation. A timeline for the submission of case briefs and written comments will be provided to interested parties at a later date. Rebuttal briefs, limited to issues raised in the case briefs, may be filed not later than five days after the date for filing case briefs.
As provided under 19 CFR 351.309(c)(2) and (d)(2), in prior proceedings we have encouraged interested parties to provide an executive summary of their brief that should be limited to five pages total, including footnotes. In this investigation, we instead request that interested parties provide at the beginning of their briefs a public, executive summary for each issue raised in their briefs.
Pursuant to 19 CFR 351.310(c), interested parties who wish to request a hearing, limited to issues raised in the case and rebuttal briefs, must submit a written request to the Assistant Secretary for Enforcement and Compliance, U.S. Department of Commerce, within 30 days after the date of publication of this notice. Requests should contain the party's name, address, and telephone number, the number of participants, whether any participant is a foreign national, and a list of the issues to be discussed. If a request for a hearing is made, Commerce will inform parties of the time and date for the hearing. Parties should confirm by telephone the date, time, and location of the hearing two days before the scheduled date.
Section 735(a)(1) of the Act and 19 CFR 351.210(b)(1) provide that Commerce will issue the final determination within 75 days after the date of its preliminary determination. Accordingly, Commerce will make its final determination no later than 75 days after the signature date of this preliminary determination.
In accordance with section 733(f) of the Act, Commerce will notify the U.S. International Trade Commission (ITC) of its preliminary determination. If the final determination is affirmative, the ITC will determine before the later of 120 days after the date of this preliminary determination or 45 days after the final determination whether imports of the subject merchandise are materially injuring, or threaten material injury to, the U.S. industry.
This determination is issued and published in accordance with sections 733(f) and 777(i)(1) of the Act and 19 CFR 351.205(c).
The scope of this investigation covers all forms and sizes of silicon metal, including silicon metal powder. Silicon metal contains at least 85.00 percent but less than 99.99 percent silicon, and less than 4.00 percent iron, by actual weight. Semiconductor grade silicon (merchandise containing at least 99.99 percent silicon by actual weight and classifiable under Harmonized Tariff Schedule of the United States (HTSUS) subheading 2804.61.0000) is excluded from the scope of this investigation.
Silicon metal is currently classifiable under subheadings 2804.69.1000 and 2804.69.5000 of the HTSUS. While the HTSUS numbers are provided for convenience and customs purposes, the written description of the scope remains dispositive.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice; proposed incidental harassment authorization; request for comments on proposed authorization and possible renewal.
NMFS has received a request from the City & Borough of Yakutat, Alaska (CBY) for authorization to take marine mammals incidental to the Yakutat Small Boat Harbor Replacement Project in Yakutat, Alaska. Pursuant to the Marine Mammal Protection Act (MMPA), NMFS is requesting comments on its proposal to issue an incidental harassment authorization (IHA) to incidentally take marine mammals during the specified activities. NMFS is also requesting comments on a possible one-time, 1-year renewal that could be issued under certain circumstances and if all requirements are met, as described in Request for Public Comments at the end of this notice. NMFS will consider public comments prior to making any final decision on the issuance of the requested MMPA authorization and agency responses will be summarized in the final notice of our decision.
Comments and information must be received no later than October 30, 2025.
Comments should be addressed to Permits and Conservation Division, Office of Protected Resources, National Marine Fisheries Service and should be submitted via email to
Robert Pauline, Office of Protected Resources, NMFS, (301) 427-8401.
The MMPA prohibits the “take” of marine mammals, with certain exceptions. Section 101(a)(5)(D) of the MMPA (16 U.S.C. 1361
Authorization for incidental takings shall be granted if NMFS finds that the taking will have a negligible impact on the species or stock(s) and will not have an unmitigable adverse impact on the availability of the species or stock(s) for taking for subsistence uses (where relevant). Further, NMFS must prescribe the permissible methods of taking and other “means of effecting the least practicable adverse impact” on the affected species or stocks and their habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance, and on the availability of the species or stocks for taking for certain subsistence uses (collectively referred to as “mitigation”); and requirements pertaining to the monitoring and reporting of the takings. The definitions of all applicable MMPA statutory terms used above are included in the relevant sections below and can be found in section 3 of the MMPA (16 U.S.C. 1362) and NMFS regulations at 50 CFR 216.103.
To comply with the National Environmental Policy Act of 1969 (NEPA; 42 U.S.C. 4321
This action is consistent with categories of activities identified in Categorical Exclusion B4 (IHAs with no anticipated serious injury or mortality) of the Companion Manual for NAO 216-6A, which do not individually or cumulatively have the potential for significant impacts on the quality of the human environment and for which we have not identified any extraordinary circumstances that would preclude this categorical exclusion. Accordingly, NMFS has preliminarily determined that the issuance of the proposed IHA qualifies to be categorically excluded from further NEPA review.
On July 8, 2024, NMFS received a request from CBY for an IHA to take marine mammals incidental to construction activities in Yakutat, Alaska. Following NMFS' review of the application and extended response times to questions that were forwarded to CBY, they submitted a revised version on August 22, 2025. The application was deemed adequate and complete on September 16, 2025. CBY's request is for take of nine species of marine mammals by Level B harassment only, and for a subset of these species, Level A harassment. Neither CBY nor NMFS expect serious injury or mortality to result from this activity and, therefore, an IHA is appropriate.
CBY is proposing to replace the existing Yakutat Small Boat Harbor (YSBH) infrastructure which has been in use for approximately 60 years. The replacement project will improve accessibility, public safety, and continue to provide the current level of public service and vessel mooring in Yakutat, Alaska. The existing gangway, headwalk, mainwalk, finger, and seaplane floats will be removed. The existing approach dock will be extended. New modular floats will be installed following completion of the approach dock extension. Temporary and permanent piles will secure the floats during and after installation.
In-water pile driving would occur on approximately 54 non-consecutive days over the course of 1 year. The proposed activities that have the potential to take marine mammals, by Level A and Level B harassment, include vibratory removal
The proposed IHA would be valid for the statutory maximum of 1 year from the date of effectiveness. It would become effective upon written notification from the applicant to NMFS, but not beginning later than 1 year from the date of issuance or extending beyond 2 years from the date of issuance. Project construction is anticipated to require approximately 54 days of in-water work (22 days of vibratory extraction; 32 days of installation, including impact, vibratory, and DTH methods) beginning in spring 2026 and would have a duration of approximately 6 months. Construction would occur based on a 10- or 12-hour work schedule, with exact timing based upon shift staffing, tide ranges, and other project scheduling considerations. In-water work, including pile driving, needs to occur between March 15 and September 30 to avoid hazardous weather conditions.
The proposed project is located in Yakutat, Alaska with the YSBH being found within Shipyard Cove. The cove is a sheltered body of water located on the eastern shore of Monti Bay. It offers a deep-water anchorage and is part of the larger Yakutat Foreland, an area of significant biodiversity, supporting over 200 species of birds and various marine mammals. Yakutat Roads refers to a waterway or channel in the vicinity of Yakutat, Alaska. It trends northeast between Monti Bay and Johnstone Passage, about 1 mile northwest of the town of Yakutat. Northwest of Shipyard Cove and across Yakutat Roads lies Deep Bay and then Sea Otter Bay which features shallower water.
CBY proposed to replace the existing YSBH infrastructure. Demolition of the existing structure would consist of removing all existing timber headwalk floats, mainwalk floats, and finger floats with the exception of the seaplane haulout ramp and work float, which would be removed and salvaged for refurbishment and reinstallation. The existing steel gangway and a small portion of the current timber approach dock would also be removed. Existing harbor floats are primarily moored with timber piles and a small number of steel piles. Piles would be removed with a vibratory hammer to facilitate removal of the floats. Quantities and methods for pile removal are detailed within table 1.
Installation of new harbor infrastructure would begin at the existing approach dock and extend offshore. A new 20-foot (6-meter) approach dock extension would be installed consisting of a steel substructure with timber stringers and timber decking, supported by a total of four 12.75-in (32.3 centimeters (cm)) diameter steel piles. All piles would be driven with a vibratory hammer from a barge-based crane. Following vibratory installation, the piles would be proofed with an impact hammer to achieve design bearing capacity. The contractor would install temporary template piles (up to 24-in (50.8-cm) diameter pipe piles or equivalent) to facilitate accurate installation of permanent piles, with temporary piles being removed following permanent pile installation. Temporary piles would be installed and removed using vibratory methods only.
New floats would be mobilized to site on a materials barge and offloaded
Due to the suspected presence of near-surface bedrock within the project site, some permanent float piles may require drilled rock sockets if the minimum specified pile embedment is not obtained. If determined to be necessary, sockets a minimum of 8 feet deep would be drilled into bedrock through the pile shaft to the width of the associated pile via DTH drilling methods. The pile would be drawn down into the DTH drilled socket through the drilling action. Prior to DTH drilling, an impact hammer would be used to seat (secure) the pile tip into the bedrock to ensure the pile does move during the drilling operations.
Proposed mitigation, monitoring, and reporting measures are described in detail later in this document (please see Proposed Mitigation and Proposed Monitoring and Reporting).
Sections 3 and 4 of the application summarize available information regarding status and trends, distribution and habitat preferences, and behavior and life history of the potentially affected species. NMFS fully considered all of this information, and we refer the reader to these descriptions, instead of reprinting the information. Additional information regarding population trends and threats may be found in NMFS' Stock Assessment Reports (SARs;
Table 2 lists all species or stocks for which take is expected and proposed to be authorized for this activity and summarizes information related to the population or stock, including regulatory status under the MMPA and Endangered Species Act (ESA) and potential biological removal (PBR), where known. PBR is defined by the MMPA as the maximum number of animals, not including natural mortalities, that may be removed from a marine mammal stock while allowing that stock to reach or maintain its optimum sustainable population (as described in NMFS' SARs). While no serious injury or mortality is anticipated or proposed to be authorized here, PBR and annual serious injury and mortality (M/SI) from anthropogenic sources are included here as gross indicators of the status of the species or stocks and other threats.
Marine mammal abundance estimates presented in this document represent the total number of individuals that make up a given stock or the total number estimated within a particular study or survey area. NMFS' stock abundance estimates for most species represent the total estimate of individuals within the geographic area, if known, that comprises that stock. For some species, this geographic area may extend beyond U.S. waters. All managed stocks in this region are assessed in NMFS' U.S. Marine Mammal SARs. All values presented in table 2 are the most recent available at the time of publication (including from the draft 2024 SARs) and are available online at:
As indicated above, all 9 species (with 13 managed stocks) in table 2 temporally and spatially co-occur with the activity to the degree that take is reasonably likely to occur.
In addition to what is included in sections 3 and 4 of the IHA application, and NMFS' website, further detail informing our analysis on the regional occurrence for select species of particular or unique vulnerability (
The migration corridor for Eastern North Pacific (ENP) stock of gray whales is along the nearshore Gulf of Alaska. One satellite tagging study of a migrating ENP gray whale found that the tagged whale travelled relatively close to shore (within 23 km on average) but primarily took the most direct route outside of embayments (Urban-Ramirez
A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay did not report any occurrences of gray whales from October 18 to October 21, 2016 (Bacon
Two stocks of humpback whales could be found in the project area. These include the Hawai'i Stock (not ESA-listed) and the Mexico-North Pacific Stock (ESA-threatened). Although humpbacks seasonally migrate, they are observed in inner and outer Resurrection Bay regularly throughout the summer season (May through August) and may venture into the outer bay year-round (McCaslin, 2019; GBIF, 2022a). There are no designated critical habitats or biologically important areas for humpback whales in the project area. In the project area it is assumed that 2.4 percent of the animals are designated to the Mexico-North Pacific stock, and the remaining are designated to the Hawai'i stock (Wade 2021).
Beluga whales in Yakutat Bay represent a small resident population of likely less than 20 individuals (Young
Seven stocks of the killer whale are found in Alaskan waters; the ENP Alaska Resident stock; the ENP Northern Resident stock; the ENP Gulf of Alaska, Aleutian Islands, and Bering Sea Transient stock; the AT1 Transient stock; the West Coast Transient stock, the ENP Southern Resident stock, and the ENP Offshore stock. All of these stocks are considered non-strategic, except for the AT1 Transient and endangered ENP Southern Resident stocks (Muto
The ENP Alaska Resident stock; ENP Gulf of Alaska, Aleutian Islands, and Bering Sea Transient stock; and West Coast Transient stock killer whales may be found in the construction impacts area (Muto
Records of killer whales in the Global Biodiversity Information Facility (GBIF) show sightings nearshore from the Yakutat and Malaspina forelands, but not within Yakutat Bay. The Alaska Department of Fish and Game wildlife viewing recommendations for Yakutat indicates that killer whales can be spotted in Yakutat Bay (ADFG 2024b). A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay did not report any occurrences of killer whales from October 18 to October 21, 2016 (Bacon
The harbor porpoise frequents nearshore waters and coastal embayments throughout their range, including bays, harbors, estuaries, and fjords less than 650 feet (198 m) deep (NMFS 2022b). Records of harbor porpoises in the GBIF show 44 occurrences reported by the public and agencies within and immediately offshore of Yakutat Bay in the past twenty years (GBIF 2024).
A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay reported three occurrences of harbor porpoises with an estimated average group size of two individuals from 18 October to 21 October 2016 (Bacon
California sea lions do not have established or permanent haulouts in Alaska; however, individual animals are occasionally sighted along the coast. There are no records of California sea lions in the Global Biodiversity Information Facility nearshore or offshore of the eastern Gulf of Alaska coast from Lituya Bay to Icy Bay (GBIF 2024).
A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay reported one occurrence of a single unidentified otariid from 18 October to 21 October 2016 (Bacon
The closest documented Steller sea lion haulouts are located at Situk, approximately 30 km southeast of Yakutat, and Haenke, approximately 48 km north of Yakutat. A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay reported a single occurrence of an unidentified otariid, presumably a Steller sea lion, entering the project's exclusion zone between 18 October 18 and October 21, 2016 (Bacon
The western DPS stock (ESA-endangered) of Steller sea lion may occur in limited numbers in the project area. Womble
Northern fur seals are typically found in offshore waters outside of the breeding season (May through November), although females and young males may be found closer to shore as they move to southern waters. Northern fur seals in Alaska are primarily located in the Pribilof Islands in the Bering Sea, with significant breeding populations on St. Paul Island and St. George Island. A smaller breeding colony can also be found on Bogoslof Island. During the winter, they migrate into the open ocean, ranging south into the Gulf of Alaska and even as far as California. In Southeast Alaska and British Columbia, they are known to occasionally haul out at sea lion rookeries (Carretta
Records of northern fur seals in the GBIF show a single occurrence from a preserved specimen reported near the continental shelf break outside Yakutat Bay in 1892 (GBIF 2024).
A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay reported one occurrence of a single
Twelve stocks of harbor seals have been identified in Alaska, ranging from the Dixon Entrance in Southeast Alaska to Bristol Bay and the Aleutian Islands (Figure 10). Harbor seals found within the range of effects from project construction are likely from the Prince William Sound stock (Muto
The nearest harbor seal haulout is located approximately 8.3 km from Yakutat and is not considered to be a major haulout.
Records of harbor seals in the GBIF show 30 occurrences reported by the public and agencies within and immediately offshore of Yakutat Bay in the past twenty years (GBIF 2024).
A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay did not report any occurrences of harbor seals from 18 October to 21 October 2016 (Bacon
Hearing is the most important sensory modality for marine mammals underwater, and exposure to anthropogenic sound can have deleterious effects. To appropriately assess the potential effects of exposure to sound, it is necessary to understand the frequency ranges marine mammals are able to hear. Not all marine mammal species have equal hearing capabilities (
For more detail concerning these groups and associated frequency ranges, please see NMFS (2024) for a review of available information.
This section provides a discussion of the ways in which components of the specified activity may impact marine mammals and their habitat. The Estimated Take of Marine Mammals section later in this document includes a quantitative analysis of the number of individuals that are expected to be taken by this activity. The Negligible Impact Analysis and Determination section considers the content of this section, the Estimated Take of Marine Mammals section, and the Proposed Mitigation section, to draw conclusions regarding the likely impacts of these activities on the reproductive success or survivorship of individuals and whether those impacts are reasonably expected to, or reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.
Acoustic effects on marine mammals during the specified activity can occur from impact and vibratory pile driving as well as DTH. The effects of underwater noise from CBY's proposed activities have the potential to result in Level A or Level B harassment of marine mammals in the action area.
The marine soundscape is comprised of both ambient and anthropogenic sounds. Ambient sound is defined as the all-encompassing sound in a given place and is usually a composite of sound from many sources both near and far. The sound level of an area is defined by the total acoustical energy being generated by known and unknown sources. These sources may include physical (
The sum of the various natural and anthropogenic sound sources at any given location and time—which comprise “ambient” or “background” sound—depends not only on the source levels (as determined by current weather conditions and levels of biological and shipping activity) but also on the ability of sound to propagate through the environment. In turn, sound propagation is dependent on the spatially and temporally varying properties of the water column and sea floor and is frequency-dependent. As a result of the dependence on many varying factors, ambient sound levels can be expected to vary widely over both coarse and fine spatial and temporal scales. Sound levels at a given frequency and location can vary by 10 to 20 dB from day to day (Richardson
In-water construction activities associated with the project would include vibratory pile removal, impact and vibratory pile driving, and DTH. The sounds produced by these activities fall into one of two general sound types: impulsive and non-impulsive. Impulsive sounds (
CBY proposes to use vibratory hammers to remove steel piles, vibratory and impact pile driving to install new steel pipe piles, and DTH for a subset of installed piles to reach full depth. Impact hammers operate by repeatedly dropping a heavy piston onto a pile to drive the pile into the substrate. Sound generated by impact hammers is characterized by rapid rise times and high peak levels, a potentially injurious combination (Hastings and Popper, 2005). Vibratory hammers install piles by vibrating them and allowing the weight of the hammer to push them into the sediment. Vibratory hammers produce significantly less sound than impact hammers. Peak sound pressure levels (SPLs) may be 180 dB or greater, but are generally 10 to 20 dB lower than SPLs generated during impact pile driving of the same-sized pile (Oestman
A DTH hammer is essentially a drill bit that drills through the bedrock using a rotating function like a normal drill, in concert with a hammering mechanism operated by a pneumatic (or sometimes hydraulic) component integrated into the DTH hammer to increase speed of progress through the substrate (
The likely or possible impacts of CBY's proposed activity on marine mammals could involve both non-acoustic and acoustic stressors. Potential non-acoustic stressors could result from the physical presence of equipment and personnel; however, any impacts to marine mammals are expected to be primarily acoustic in nature. Acoustic stressors include effects of heavy equipment operation during pile installation and removal.
The introduction of anthropogenic noise into the aquatic environment from pile driving and removal is the means by which marine mammals may be harassed from CBY's specified activity. In general, animals exposed to natural or anthropogenic sound may experience behavioral, physiological, and/or physical effects, ranging in magnitude from none to severe (Southall
NMFS defines a noise-induced TS as a change, usually an increase, in the threshold of audibility at a specified frequency or portion of an individual's hearing range above a previously established reference level (NMFS, 2018, 2024). The amount of TS is customarily expressed in dB. A TS can be permanent or temporary. As described in NMFS (2018, 2024), there are numerous factors to consider when examining the consequence of TS, including, but not limited to, the signal temporal pattern (
Depending on the degree (elevation of threshold in dB), duration (
Many studies have examined noise-induced hearing loss in marine mammals (see Finneran (2015) and Southall
The amount and onset of TTS depends on the exposure frequency. Sounds at low frequencies, well below the region of best sensitivity for a species or hearing group, are less hazardous than those at higher frequencies, near the region of best sensitivity (Finneran and Schlundt, 2013). At low frequencies, onset-TTS exposure levels are higher compared to those in the region of best sensitivity (
Relationships between TTS and PTS thresholds have not been studied in marine mammals, and there is no PTS data for cetaceans, but such relationships are assumed to be similar to those in humans and other terrestrial mammals. PTS typically occurs at exposure levels at least several decibels above that inducing mild TTS (
Activities for this project include impact pile driving, vibratory pile driving and vibratory removal, and DTH. There would likely be pauses in activities producing the sound during each day. Given these pauses and the fact that many marine mammals are likely moving through the project areas and not remaining for extended periods of time, the potential for TS declines.
Behavioral responses to sound are highly variable and context-specific and any reactions depend on numerous intrinsic and extrinsic factors (
Habituation can occur when an animal's response to a stimulus wanes with repeated exposure, usually in the absence of unpleasant associated events (Wartzok
As noted above, behavioral state may affect the type of response. For example, animals that are resting may show greater behavioral change in response to disturbing sound levels than animals that are highly motivated to remain in an area for feeding (Richardson
Available studies show wide variation in response to underwater sound; therefore, it is difficult to predict specifically how any given sound in a particular instance might affect marine mammals perceiving the signal. If a marine mammal does react briefly to an underwater sound by changing its behavior or moving a small distance, the impacts of the change are unlikely to be significant to the individual, l
Changes in dive behavior can vary widely and may consist of increased or decreased dive times and surface intervals as well as changes in the rates of ascent and descent during a dive (
Disruption of feeding behavior can be difficult to correlate with anthropogenic sound exposure, so it is usually inferred by observed displacement from known foraging areas, the appearance of secondary indicators (
In response to playbacks of vibratory pile driving sounds, captive bottlenose dolphins showed changes in target detection and number of clicks used for a trained echolocation task (Branstetter
Variations in respiration naturally vary with different behaviors and alterations to breathing rate as a function of acoustic exposure can be expected to co-occur with other behavioral reactions, such as a flight response or an alteration in diving. However, respiration rates in and of themselves may be representative of annoyance or an acute stress response. Various studies have shown that respiration rates may either be unaffected or could increase, depending on the species and signal characteristics, again highlighting the importance in understanding species differences in the
Avoidance is the displacement of an individual from an area or migration path as a result of the presence of a sound or other stressors and is one of the most obvious manifestations of disturbance in marine mammals (Richardson
A flight response is a dramatic change in normal movement to a directed and rapid movement away from the perceived location of a sound source. The flight response differs from other avoidance responses in the intensity of the response (
Behavioral disturbance can also impact marine mammals in more subtle ways. Increased vigilance may result in costs related to diversion of focus and attention (
Many animals perform vital functions, such as feeding, resting, traveling, and socializing, on a diel cycle (24-hour cycle). Disruption of such functions resulting from reactions to stressors such as sound exposure are more likely to be significant if they last more than one diel cycle or recur on subsequent days (Southall
Neuroendocrine stress responses often involve the hypothalamus-pituitary-adrenal system. Virtually all neuroendocrine functions that are affected by stress—including immune competence, reproduction, metabolism, and behavior—are regulated by pituitary hormones. Stress-induced changes in the secretion of pituitary hormones have been implicated in failed reproduction, altered metabolism, reduced immune competence, and behavioral disturbance (
The primary distinction between stress (which is adaptive and does not normally place an animal at risk) and “distress” is the cost of the response. During a stress response, an animal uses glycogen stores that can be quickly replenished once the stress is alleviated. In such circumstances, the cost of the stress response would not pose serious fitness consequences. However, when an animal does not have sufficient energy reserves to satisfy the energetic costs of a stress response, energy resources must be diverted from other functions. This state of distress would last until the animal replenishes its energetic reserves sufficient to restore normal function.
Relationships between these physiological mechanisms, animal behavior, and the costs of stress responses are well-studied through controlled experiments and for both laboratory and free-ranging animals (
Marine mammals vocalize for different purposes and across multiple modes, such as whistling, echolocation click production, calling, and singing. Changes in vocalization behavior in response to anthropogenic noise can occur for any of these modes and may result from a need to compete with an increase in background noise or may reflect increased vigilance or a startle response. For example, in the presence of potentially masking signals, humpback whales and killer whales have been observed to increase the length of their songs (Miller
Under certain circumstances, marine mammals experiencing significant masking could also be impaired from maximizing their performance fitness in survival and reproduction. Therefore, when the coincident (masking) sound is human-made, it may be considered harassment when disrupting or altering critical behaviors. It is important to distinguish TTS and PTS, which persist after the sound exposure, from masking, which occurs during the sound exposure. Because masking (without resulting in TS) is not associated with abnormal physiological function, it is not considered a physiological effect, but rather a potential behavioral effect (though not necessarily one that would be associated with harassment).
The frequency range of the potentially masking sound is important in determining any potential behavioral impacts. For example, low-frequency signals may have less effect on high-frequency echolocation sounds produced by odontocetes but are more likely to affect detection of mysticete communication calls and other potentially important natural sounds such as those produced by surf and some prey species. The masking of communication signals by anthropogenic noise may be considered as a reduction in the communication space of animals (
Marine mammals at or near the proposed CBY project site may be exposed to anthropogenic noise which may be a source of masking. Vocalization changes may result from a need to compete with an increase in background noise and include increasing the source level, modifying the frequency, increasing the call repetition rate of vocalizations, or ceasing to vocalize in the presence of increased noise (Hotchkin and Parks, 2013). For example, in response to loud noise, beluga whales may shift the frequency of their echolocation clicks to prevent masking by anthropogenic noise (Tyack, 2000; Eickmeier and Vallarta, 2022).
Masking occurs in the frequency band or bands that animals utilize and is more likely to occur in the presence of broadband, relatively continuous noise sources such as vibratory pile driving. Energy distribution of pile driving covers a broad frequency spectrum, and sound from pile driving would be within the audible range of pinnipeds and cetaceans present in the proposed action area. While some construction during the CBY's activities may mask some acoustic signals that are relevant to the daily behavior of marine mammals, the short-term duration and limited areas affected make it very unlikely that the fitness of individual marine mammals would be impacted.
Airborne noise would primarily be an issue for pinnipeds that are swimming or hauled out near the project site within the range of noise levels elevated above the airborne acoustic harassment criteria. We recognize that pinnipeds in the water could be exposed to airborne sound that may result in behavioral harassment when swimming with their heads above water. Most likely, airborne sound would cause behavioral responses similar to those discussed above in relation to underwater sound. For instance, anthropogenic sound could cause hauled-out pinnipeds to exhibit changes in their normal behavior, such as reduction in vocalizations, or cause them to temporarily abandon the area and move further from the source. However, these animals would previously have been `taken' because of exposure to underwater sound above the behavioral
Construction activities at the Yakutat Small Boat Harbor Replacement Project could have localized, temporary impacts on marine mammal habitat and their prey by increasing in-water SPLs and slightly decreasing water quality. Increased noise levels may affect acoustic habitat (see
Effects to turbidity and sedimentation are expected to be short-term, minor, and localized. Suspended sediments in the water column should dissipate and quickly return to background levels in all construction scenarios. Turbidity within the water column has the potential to reduce the level of oxygen in the water and irritate the gills of prey fish species in the proposed project area. However, turbidity plumes associated with the project would be temporary and localized, and fish in the proposed project area would be able to move away from and avoid the areas where plumes may occur. Therefore, it is expected that the impacts on prey fish species from turbidity, and therefore on marine mammals, would be minimal and temporary. In general, the area likely impacted by the proposed construction activities is relatively small compared to the available marine mammal habitat in the Gulf of Alaska, and does not include any areas of particular importance.
Fish utilize the soundscape and components of sound in their environment to perform important functions such as foraging, predator avoidance, mating, and spawning (
Fish react to sounds which are especially strong and/or intermittent low-frequency sounds, and behavioral responses such as flight or avoidance are the most likely effects. Short duration, sharp sounds can cause overt or subtle changes in fish behavior and local distribution. The reaction of fish to noise depends on the physiological state of the fish, past exposures, motivation (
SPLs of sufficient strength have been known to cause injury to fish and fish mortality. However, in most fish species, hair cells in the ear continuously regenerate and loss of auditory function likely is restored when damaged cells are replaced with new cells. Halvorsen
The greatest potential impact to fishes during construction would occur during unattenuated impact pile and DTH. In-water construction activities would only occur during daylight hours, allowing fish to forage and transit the project area in the evening. Vibratory pile driving would possibly elicit behavioral reactions from fishes such as temporary avoidance of the area but is unlikely to cause injuries to fishes or have persistent effects on local fish populations.
Construction also would have minimal permanent and temporary impacts on benthic invertebrate species, a marine mammal prey source. In addition, it should be noted that the area in question is low-quality habitat since it is already highly developed and experiences a high level of anthropogenic noise from normal operations and other vessel traffic. In general, any negative impacts on marine mammal prey species are expected to be minor and temporary.
Fish populations in the proposed project area that serve as marine mammal prey could be temporarily affected by noise from pile installation and removal. The frequency range in
The most likely impact to fish from pile driving activities in the project area would be temporary behavioral avoidance of the area. The duration of fish avoidance of an area after pile driving stops is unknown, but a rapid return to normal recruitment, distribution and behavior is anticipated. In general, impacts to marine mammal prey species are expected to be minor and temporary due to the expected short daily duration of individual pile driving events.
Avoidance by potential prey (
In summary, given the short daily duration of sound associated with individual pile driving events and the relatively small areas being affected, pile driving activities associated with the proposed action are not likely to have a permanent adverse effect on any fish habitat, or populations of fish species. Any behavioral avoidance by fish of the disturbed area would still leave significantly large areas of fish and marine mammal foraging habitat in the nearby vicinity. Thus, we conclude that impacts of the specified activity are not likely to have more than short-term adverse effects on any prey habitat or populations of prey species. Further, any impacts to marine mammal habitat are not expected to result in significant or long-term consequences for individual marine mammals, or to contribute to adverse impacts on their populations.
This section provides an estimate of the number of incidental takes proposed for authorization through the IHA, which will inform NMFS' consideration of “small numbers,” the negligible impact determinations, and impacts on subsistence uses.
Harassment is the only type of take expected to result from these activities. Except with respect to certain activities not pertinent here, section 3(18) of the MMPA defines “harassment” as any act of pursuit, torment, or annoyance, which (i) has the potential to injure a marine mammal or marine mammal stock in the wild (Level A harassment); or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering (Level B harassment).
Authorized takes would primarily be by Level B harassment, as use of pile driving and DTH has the potential to result in disruption of behavioral patterns for individual marine mammals. There is also some potential for auditory injury (AUD INJ) (Level A harassment) to result, primarily for very high frequency species and/or phocids because predicted AUD INJ zones are larger than for high-frequency species and/or otariids. The proposed mitigation and monitoring measures are expected to minimize the severity of the taking to the extent practicable.
As described previously, no serious injury or mortality is anticipated or proposed to be authorized for this activity. Below we describe how the proposed take numbers are estimated.
For acoustic impacts, generally speaking, we estimate take by considering: (1) acoustic criteria above which NMFS believes there is some reasonable potential for marine mammals to be behaviorally harassed or incur some degree of AUD INJ; (2) the area or volume of water that will be ensonified above these levels in a day; (3) the density or occurrence of marine mammals within these ensonified areas; and, (4) the number of days of activities. We note that while these factors can contribute to a basic calculation to provide an initial prediction of potential takes, additional information that can qualitatively inform take estimates is also sometimes available (
NMFS recommends the use of acoustic criteria that identify the received level of underwater sound above which exposed marine mammals would be reasonably expected to be behaviorally harassed (equated to Level B harassment) or to incur AUD INJ of some degree (equated to Level A harassment). We note that the criteria for AUD INJ, as well as the names of two hearing groups, have been recently updated (NMFS, 2024) as reflected below in the Level A harassment section.
CBY's proposed activity includes the use of continuous (vibratory pile driving and DTH) and impulsive (DTH and impact pile driving) sources, and therefore the RMS SPL thresholds of 120 and 160 dB re 1 μPa are applicable.
The 2024 Updated Technical Guidance criteria include both updated thresholds and updated weighting functions for each hearing group. The thresholds are provided in table 4 below. The references, analysis, and methodology used in the development of the criteria are described in NMFS' 2024 Updated Technical Guidance, which may be accessed at:
Here, we describe operational and environmental parameters of the activity that are used in estimating the area ensonified above the acoustic thresholds, including source levels and transmission loss coefficient.
The sound field in the project area is the existing background noise plus additional construction noise from the proposed project. Marine mammals are expected to be affected via sound generated by the primary components of the project (
The project includes vibratory pile installation and removal, impact pile driving, and DTH. Source levels for these activities are based on reviews of measurements of the same or similar types and dimensions of piles available in the literature. Source levels for each pile size are presented in table 5. Source levels for vibratory installation and removal of piles of the same diameter are assumed to be the same.
Absent site-specific acoustical monitoring with differing measured
The ensonified area associated with Level A harassment is more technically challenging to predict due to the need to account for a duration component. Therefore, NMFS developed an optional User Spreadsheet tool to accompany the 2024 Updated Technical Guidance that can be used to relatively simply predict an isopleth distance for use in conjunction with marine mammal density or occurrence to help predict potential takes. We note that because of some of the assumptions included in the methods underlying this optional tool, we anticipate that the resulting isopleth estimates are typically going to be overestimates of some degree, which may result in an overestimate of potential take by Level A harassment. However, this optional tool offers the best way to estimate isopleth distances when more sophisticated modeling methods are not available or practical. For stationary sources such as pile driving, the optional User Spreadsheet tool predicts the distance at which, if a marine mammal remained at that distance for the duration of the activity, it would be expected to incur auditory injury. Inputs used in the User Spreadsheet (
In this section we provide information about the occurrence of marine mammals, including density or other relevant information which will inform the take calculations.
CBY calculated occurrence estimates based on literature and communication with locals in the Yakutat area, notably a local charter boat operator. They then multiplied that occurrence by estimated days, weeks, or months of work. After reviewing their occurrence estimates, NMFS believed some of the estimates to be inconsistent with the cited literature and local observations. Following careful review of the analysis and literature presented by CBY in its application, including marine mammal occurrence data and estimates, NMFS has preliminarily determined that the occurrence estimates for some species represent the best available scientific information for marine mammal abundance in the action area. The following paragraphs explain how the local abundance of authorized species was determined (table 7). Table 8 depicts the proposed take by stock, harassment type, and as a percentage of stock abundance.
Dalheim
The local boat charter company reports gray whales are occasionally seen travelling in groups of three. It was assumed that there would be one whale spotted very three days. No take by Level A is expected due to the large shutdown zone and easy observability of animals from this species.
Killer whale group sizes in Southeast Alaska vary by ecotype and by season (Dalheim
No take by Level A harassment is proposed due to the small AUD INJ zone and high visibility of this species.
An average group size of two has been reported by Zerbini
Observation of beluga whales in the project is uncommon. This is not surprising given the small number of animals (<20) in this small resident population and relatively large habitat area. Lucey
A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay reported a single occurrence of an unidentified otariid, presumably a Steller sea lion, during 1 week in October 2016 (Bacon
California sea lion sightings in Southeast and Southcentral Alaska are relatively rare but do occur on occasion (Woodford 2020). There are no records of California sea lions in the GBIFn the project area (GBIF 2024). A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay reported one occurrence of a single unidentified otariid during 1 week in Oct 2016 (Bacon et al. 2016). CBY conservatively proposed, and NMFS concurs, that there could be a single sighting per week over the 24-week project timeline. No take by Level A harassment is proposed due to the small AUD INJ zone.
Norther fur seals are uncommon in the project area as there are no definitive observations on record. A marine mammal monitoring report from the Ocean Cape Seafoods Dock Fender Repairs project in Monti Bay reported one occurrence of a single unidentified otariid, which may have been a fur seal, during one week in October 2016 (Bacon
The local charter boat reports that harbor seals not typically observed entering Shipyard Cove but are regularly recorded in Yakutat Bay and associated fjords of Disenchantment Bay, where they use glacial ice for critical life stages like pupping and molting. Records of harbor seals in the GBIF show 30 occurrences reported by the public and agencies within and immediately offshore of Yakutat Bay in the past 20 years (GBIF 2024). It is conservatively assumed that three harbor seals would be observed per day over 54 in-water
Total exposure estimates were calculated by multiplying the number of days of work (54 days total; 22 days of vibratory-only activities, and 32 days of vibratory, impact, and DTH activities) by the occurrence estimates for each species, and total exposures were then divided into estimates of take by Level A and Level B harassment. For days with impact and DTH activities, there is potential for take by Level A harassment for very high-frequency cetaceans (harbor porpoises) and phocid pinnipeds (harbor seals) due to the larger Level A harassment zones associated with animals in these hearing groups. In some instances, the largest zones for some species are greater than the shutdown zones due to the cryptic nature and assumed lower detectability of some species and the sensitivity of these species' hearing thresholds. CBY calculated estimated take by Level A harassment for these species by calculating the ratio of the area of the Level A harassment zones to the area of the maximum Level B harassment zone. This ratio was multiplied by the exposure estimate for days with impact driving and DTH activities to get the estimated take by Level A harassment. Take by Level B harassment was then calculated by subtracting the calculated take by Level A harassment from the total exposure estimate. This was only necessary for harbor porpoises and harbor seals as they are the only species for which the Level A harassment zones exceeded the Level B harassment zone. Calculations are presented below.
In order to issue an IHA under section 101(a)(5)(D) of the MMPA, NMFS must set forth the permissible methods of taking pursuant to the activity, and other means of effecting the least practicable impact on the species or stock and its habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance, and on the availability of the species or stock for taking for certain subsistence uses. NMFS regulations require applicants for incidental take authorizations to include information about the availability and feasibility (economic and technological) of equipment, methods, and manner of conducting the activity or other means of effecting the least practicable adverse impact upon the affected species or stocks, and their habitat (50 CFR 216.104(a)(11)).
In evaluating how mitigation may or may not be appropriate to ensure the least practicable adverse impact on species or stocks and their habitat, as well as subsistence uses where applicable, NMFS considers two primary factors:
(1) The manner in which, and the degree to which, the successful implementation of the measure(s) is expected to reduce impacts to marine mammals, marine mammal species or stocks, and their habitat. This considers the nature of the potential adverse impact being mitigated (likelihood, scope, range). It further considers the likelihood that the measure will be effective if implemented (probability of accomplishing the mitigating result if implemented as planned), the likelihood of effective implementation (probability implemented as planned), and
(2) The practicability of the measures for applicant implementation, which may consider such things as cost, and impact on operations.
The mitigation requirements described below were proposed by CBY in its adequate and complete application or are the result of subsequent coordination between NMFS and CBY. CBY has agreed that all of the mitigation measures are practicable. NMFS has fully reviewed the specified activities and the mitigation measures to determine if the mitigation measures would result in the least practicable adverse impact on marine mammals and their habitat, as required by the MMPA, and has determined the proposed measures are appropriate. NMFS describes these below as proposed mitigation requirements and has included them in the proposed IHA.
CBY must ensure that construction supervisors and crews, the monitoring team, and relevant CBY staff are trained prior to the start of all pile driving and DTH activity, so that responsibilities, communication procedures, monitoring protocols, and operational procedures are clearly understood. New personnel joining during the project must be trained prior to commencing work.
• Monitoring must take place from 30 minutes prior to initiation of pile driving and DTH activity (
• Pre-start clearance monitoring must be conducted during periods of visibility sufficient for the lead protected species observer (PSO) to determine that the shutdown zones indicated in table 10 are clear of marine mammals. Pile driving and DTH may commence following 30 minutes of observation when the determination is made that the shutdown zones are clear of marine mammals.
CBY must use soft start techniques when impact pile driving. Soft start requires contractors to provide an initial set of three strikes at reduced energy, followed by a 30-second waiting period, then two subsequent reduced-energy strike sets. A soft start must be implemented at the start of each day's impact pile driving and at any time following cessation of impact pile driving for a period of 30 minutes or longer.
CBY would establish shutdown zones for all pile driving activities. The purpose of a shutdown zone is generally to define an area within which shutdown of the activity would occur upon sighting of a marine mammal (or in anticipation of an animal entering the defined area).
If a marine mammal is observed entering or within the shutdown zones indicated in table 9, pile driving and DTH must be delayed or halted. For in-water heavy machinery activities other than pile driving, if a marine mammal comes within 10-m, work must stop and vessels must reduce speed to the minimum level required to maintain steerage and safe working conditions. A 10-m shutdown zone would also serve to protect marine mammals from physical interactions with project vessels during pile driving and other construction activities, such as barge positioning or drilling. If an activity is delayed or halted due to the presence of a marine mammal, the activity may not commence or resume until either the animal has voluntarily exited and been visually confirmed beyond the shutdown zone indicated in table 9, or 15 minutes have passed without re-detection of the animal. Construction activities must be halted upon observation of a species for which incidental take is not authorized or a species for which incidental take has been authorized but the authorized number of takes has been met entering or within the harassment zone.
All marine mammals would be monitored to the extent possible based on PSO locations. If a marine mammal enters the Level B harassment zone, in-water activities would continue and the animal's presence within the estimated harassment zone would be documented.
CBY would also establish shutdown zones for all marine mammals for which take has not been authorized or for which incidental take has been authorized but the authorized number of takes has been met. If a marine mammal species for which take is not authorized by this IHA enters the shutdown zone, all in-water activities would cease until the animal leaves the zone or has not been observed for at least 15 minutes. Pile driving would proceed if the non-IHA species is observed to leave the Level B harassment zone or if 15 minutes have passed since the last observation.
If shutdown and/or clearance procedures would result in an imminent safety concern, as determined by CBY or its designated officials, the in-water activity would be allowed to continue until the safety concern has been addressed, and the animal would be continuously monitored.
The placement of PSOs during all construction activities (described in the Monitoring and Reporting section) would ensure that the entire shutdown zone is visible. Should environmental conditions deteriorate such that the entire shutdown zone would not be visible (
CBY must employ PSOs and establish monitoring locations as described in the marine mammal monitoring plan and the IHA. PSOs would monitor the full shutdown zones and the Level B harassment zones to the extent practicable. Monitoring zones provide utility for observing by establishing monitoring protocols for areas adjacent to the shutdown zones. Monitoring zones enable observers to be aware of and communicate the presence of marine mammals in the project areas outside the shutdown zones and thus prepare for a potential cessation of activity should the animal enter the shutdown zone.
Based on our evaluation of the applicant's proposed measures, NMFS has preliminarily determined that the proposed mitigation measures provide the means of effecting the least practicable impact on the affected species or stocks and their habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance.
In order to issue an IHA for an activity, section 101(a)(5)(D) of the MMPA states that NMFS must set forth requirements pertaining to the monitoring and reporting of such taking. The MMPA implementing regulations at 50 CFR 216.104(a)(13) indicate that requests for authorizations must include the suggested means of accomplishing the necessary monitoring and reporting that will result in increased knowledge of the species and of the level of taking or impacts on populations of marine mammals that are expected to be present while conducting the activities. Effective reporting is critical both to compliance as well as ensuring that the most value is obtained from the required monitoring.
Monitoring and reporting requirements prescribed by NMFS should contribute to improved understanding of one or more of the following:
• Occurrence of marine mammal species or stocks in the area in which take is anticipated (
• Nature, scope, or context of likely marine mammal exposure to potential stressors/impacts (individual or cumulative, acute or chronic), through better understanding of: (1) action or environment (
• Individual marine mammal responses (behavioral or physiological) to acoustic stressors (acute, chronic, or cumulative), other stressors, or cumulative impacts from multiple stressors;
• How anticipated responses to stressors impact either: (1) long-term fitness and survival of individual marine mammals; or (2) populations, species, or stocks;
• Effects on marine mammal habitat (
• Mitigation and monitoring effectiveness.
The monitoring and reporting requirements described in the following were proposed by CBY in its adequate and complete application and/or are the result of subsequent coordination between NMFS and CBY. CBY has agreed to the requirements. NMFS describes these below as proposed monitoring and reporting requirements and has included them in the proposed IHA.
Marine mammal monitoring must be conducted in accordance with the conditions in this section and the IHA. Marine mammal monitoring during pile driving and DTH activities must be conducted by PSOs meeting the following requirements:
• PSOs must be independent of the activity contractor (for example, employed by a subcontractor) and have no other assigned tasks during monitoring periods;
• At least one PSO must have prior experience performing the duties of a PSO during construction activity pursuant to a NMFS-issued incidental take authorization;
• Other PSOs may substitute relevant experience (including Alaska Native traditional knowledge), education (degree in biological science or related field), or training for prior experience performing the duties of a PSO during construction activity pursuant to a NMFS-issued incidental take authorization or Letter of Concurrence (LOC); and,
• Where a team of three or more PSOs is required, a lead observer or monitoring coordinator would be designated. The lead observer would be required to have prior experience performing the duties of a PSO during construction activities pursuant to a NMFS-issued incidental take authorization.
• PSOs must be approved by NMFS prior to beginning any activities subject to this IHA.
PSOs must have the following additional qualifications:
• Ability to conduct field observations and collect data according to assigned protocols;
• Experience or training in the field identification of marine mammals, including the identification of behaviors;
• Sufficient training, orientation, or experience with the construction operation to provide for personal safety during observations;
• Writing skills sufficient to prepare a report of observations including but not limited to the number and species of marine mammals observed; dates and times when in-water construction activities were conducted; dates, times and reason for implementation of mitigation (or why mitigation was not implemented when required); and marine mammal behavior; and,
• Ability to communicate orally, by radio or in person, with project personnel to provide real-time information on marine mammals observed in the area as necessary.
CBY must assign a minimum of two PSOs to monitor during pile driving and DTH. They must be stationed where they have an unobstructed view of the work being conducted and unobstructed view of all the water within the Shutdown Zones and as much of the Level B harassment zone as possible. Optimal observation locations will be selected based on visibility and the type of work occurring. All PSOs would have access to high-quality binoculars, range finders to monitor distances, and a compass to record bearing to animals as well as radios or cells phones for maintaining contact with work crews.
Monitoring would be conducted 30 minutes before, during, and 30 minutes after all in water construction activities. In addition, PSOs would record all incidents of marine mammal occurrence, regardless of distance from activity, and would document any behavioral reactions in concert with distance from piles being driven or removed. Pile driving activities include the time to install or remove a single pile or series of piles, as long as the time elapsed between uses of the pile driving equipment is no more than 30 minutes.
CBY shall conduct briefings between construction supervisors and crews, PSOs, and CBY staff prior to the start of all pile driving activities and when new personnel join the work. These briefings must explain responsibilities, communication procedures, marine mammal monitoring protocol, and operational procedures.
A draft marine mammal monitoring report would be submitted to NMFS within 90 days after the completion of pile driving and removal activities, or 60 days prior to a requested date of issuance from any future IHAs for projects at the same location, whichever comes first. The report would include an overall description of work completed, a narrative regarding marine mammal sightings, and associated electronic PSO data sheets. Specifically, the report must include:
• Dates and times (begin and end) of all marine mammal monitoring;
• Construction activities occurring during each daily observation period, including the number and type of piles driven or removed and by what method (
• PSO locations during marine mammal monitoring;
• Environmental conditions during monitoring periods (at beginning and end of PSO shift and whenever conditions change significantly), including Beaufort sea state and any other relevant weather conditions including cloud cover, fog, sun glare, and overall visibility to the horizon, and estimated observable distance;
• Upon observation of a marine mammal, the following information: (1) Name of PSO who sighted the animal(s) and PSO location and activity at the time of sighting; (2) Time of sighting; (3) Identification of the animal(s) (
• Number of marine mammals detected within the harassment zones and shutdown zones; by species; and,
• Detailed information about any implementation of any mitigation triggered (
If no comments are received from NMFS within 30 days, the draft final report would constitute the final report. If comments are received, a final report addressing NMFS comments must be submitted within 30 days after receipt of comments.
In the event that personnel involved in the construction activities discover an injured or dead marine mammal, CBY must immediately cease the specified activities and report the incident to the Office of Protected Resources (
• Time, date, and location (latitude/longitude) of the first discovery (and updated location information if known and applicable);
• Species identification (if known) or description of the animal(s) involved;
• Condition of the animal(s) (including carcass condition if the animal is dead);
• Observed behaviors of the animal(s), if alive;
• If available, photographs or video footage of the animal(s); and,
• General circumstances under which the animal was discovered.
NMFS has defined negligible impact as an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival (50 CFR 216.103). A negligible impact finding is based on the lack of likely adverse effects on annual rates of recruitment or survival (
To avoid repetition, the discussion of our analysis applies to all the species listed in table 2, given that the anticipated effects of this activity on these different marine mammal stocks are expected to be similar. There is little information about the nature or severity of the impacts, or the size, status, or structure of any of these species or stocks that would lead to a different analysis for this activity.
Pile driving and DTH activities associated with the CBY project have the potential to disturb or displace marine mammals. Specifically, the project activities may result in take, in the form of Level A and Level B harassment, from underwater and in-air sounds generated from pile driving and removal. Potential takes could occur if individuals are present in the ensonified zone when these activities are underway.
Takes by Level B harassment would be due to potential behavioral disturbance and TTS. Takes by Level A harassment would be due to auditory injury. No serious injury or mortality is expected, even in the absence of required mitigation measures, given the nature of the activities. The potential for harassment would be further minimized through the construction method and the implementation of the planned mitigation measures.
Take by Level A harassment is authorized for harbor porpoises and harbor seals to account for the possibility that an animal could enter a Level A harassment zone and remain within that zone for a duration long enough to incur auditory injury before being observed by PSOs. Given the relatively short duration expected to drive each pile and breaks between pile installations (to reset equipment and move piles into place), an animal would have to remain within the area estimated to be ensonified above the Level A harassment threshold for an extended period. This is highly unlikely given the mobile nature of marine mammals in the area. Any take by Level A harassment is expected to arise from, at most, a small degree of auditory injury,
Additionally, some subset of the individuals that are behaviorally harassed could also simultaneously incur some small degree of TTS for a short duration of time. However, since the hearing sensitivity of individuals that incur TTS is expected to recover completely within minutes to hours, it is unlikely that the brief hearing impairment would affect the individual's long-term ability to forage and communicate with conspecifics, and would therefore not likely impact reproduction or survival of any individual marine mammal, let alone adversely affect rates of recruitment or survival of the species or stock.
Behavioral responses of marine mammals to pile driving and DTH in the ensonified area are expected to be mild, short term, and temporary. Marine mammals within the Level B harassment zones may not show any visual cues they are disturbed by the proposed activities, or they could become alert, avoid the area, leave the area, or display other mild responses that are not observable, such as changes in vocalization patterns. Given that pile driving and DTH would occur intermittently and for only a portion of the project's duration, any harassment would be temporary.
Any impacts on marine mammal prey that would occur during CBY's proposed activity would have, at most, short-term effects on foraging of individual marine mammals, and likely no effect on the populations of marine mammals as a whole. Indirect effects on marine mammal prey during the construction are expected to be minor, and these effects are unlikely to cause substantial effects on marine mammals at the individual level, with no expected effect on annual rates of recruitment or survival.
For all species and stocks, take would occur within a limited, confined space (
There is a migratory BIA for the gray whale that includes the months of January, March, April, May, November and December. In-water construction operations would occur during the March through May period when whales are migrating; however, the project area is inside Yakutat Bay, a relatively sheltered area with only one entrance and exit point, and gray whales are not expected to spend significant time nearby. There is also a Yakutat Bay Beluga whale Small and Resident Population BIA that is active year-
In addition, it is unlikely that minor noise effects in a small, localized area of habitat would have any effect on the reproduction or survival of any individuals, much less the stocks' annual rates of recruitment or survival. In combination, we believe that these factors, as well as the available body of evidence from other similar activities, demonstrate that the potential effects of the specified activities would have only minor, short-term effects on individuals. The specified activities are not expected to impact rates of recruitment or survival and would therefore not result in population-level impacts.
In summary and as described above, the following factors primarily support our preliminary determination that the impacts resulting from this activity are not expected to adversely affect any of the species or stocks through effects on annual rates of recruitment or survival:
• No serious injury or mortality is anticipated or proposed for authorization;
• Take by Level A harassment (AUD INJ) is proposed for authorization for two species due to associated large Level A harassment zones but the amount of take would be limited and of a low degree;
• For all species and stocks, Yakutat Bay is a small and peripheral part of their range;
• The intensity of anticipated take by Level B harassment is relatively low for all stocks. Level B harassment would be primarily in the form of behavioral disturbance, resulting in avoidance of the project areas around where impact driving and DTH is occurring, with some low-level TTS that may limit the detection of acoustic cues for relatively brief periods;
• Effects on species that serve as prey for marine mammals from the activities are expected to be short-term and, therefore, any associated impacts on marine mammal feeding are not expected to result in significant or long-term consequences for individuals, or to accrue to adverse impacts on their populations;
• The ensonified areas are small relative to the overall habitat ranges of all species and stocks; and,
• The lack of anticipated significant or long-term negative effects to marine mammal habitat.
Based on the analysis contained herein of the likely effects of the specified activity on marine mammals and their habitat, and taking into consideration the implementation of the proposed monitoring and mitigation measures, NMFS preliminarily finds that the total marine mammal take from the proposed activity will have a negligible impact on all affected marine mammal species or stocks.
As noted previously, only take of small numbers of marine mammals may be authorized under section 101(a)(5)(A) and (D) of the MMPA for specified activities other than military readiness activities. The MMPA does not define small numbers and so, in practice, where estimated numbers are available, NMFS compares the number of individuals taken to the most appropriate estimation of abundance of the relevant species or stock in our determination of whether an authorization is limited to small numbers of marine mammals. When the predicted number of individuals to be taken is fewer than one-third of the species or stock abundance, the take is considered to be of small numbers (86 FR 5322, January 19, 2021). Additionally, other qualitative factors may be considered in the analysis, such as the temporal or spatial scale of the activities.
Another circumstance in which NMFS considers it appropriate to make a small numbers finding is in the case of a species or stock that may potentially be taken but is either rarely encountered or only expected to be taken on rare occasions. In that circumstance, one or two assumed encounters with a group of animals (meaning a group that is traveling together or aggregated, and thus exposed to a stressor at the same approximate time) should reasonably be considered small numbers, regardless of consideration of the proportion of the stock (if known), as rare encounters resulting in take of one or two groups should be considered small relative to the range and distribution of any stock.
While the percentage of stock taken for the Cook Inlet beluga whale stock is below one third, the Yakutat portion of the Cook Inlet beluga whale stock is considered to be resident in the waters around Yakutat, particularly in Disenchantment Bay, and consists of fewer than 20 individuals. It is possible that all or a subset of these whales will visit the project site during the construction period during their regular movements in the area. NMFS considers it reasonably likely that Yakutat belugas may occur up to two times during the project. Based on the rarity of encounters with this group expected, this represents small numbers for this stock.
For all other stocks, except for the ENP Gulf of Alaska, Aleutian Islands, and Bering Sea transient and West Coast transient stocks of killer whale, the proposed number of takes is less than one-third of the best available population abundance estimate (table 8). The numbers of animals proposed for authorization to be taken from these stocks would be considered small relative to the relevant stocks' abundances, even if each estimated taking occurred to a new individual—an extremely unlikely scenario. The estimated take of the two killer whale stocks assumes that all takes would be accrued by a single stock. This is highly unlikely for animals with extended habitat ranges throughout coastal Alaska down to California.
Based on the analysis contained herein of the proposed activity (including the proposed mitigation and monitoring measures) and the anticipated take of marine mammals, NMFS preliminarily finds that small numbers of marine mammals would be taken relative to the population size of the affected species or stocks.
In order to issue an IHA, NMFS must find that the specified activity will not have an “unmitigable adverse impact” on the subsistence uses of the affected marine mammal species or stocks by Alaskan Natives. NMFS has defined “unmitigable adverse impact” in 50 CFR 216.103 as an impact resulting from the specified activity: (1) That is likely to reduce the availability of the species to a level insufficient for a harvest to meet subsistence needs by: (i) Causing the marine mammals to abandon or avoid hunting areas; (ii) Directly displacing subsistence users; or (iii) Placing physical barriers between the marine mammals and the subsistence hunters; and (2) That cannot be sufficiently mitigated by other measures to increase the availability of marine mammals to allow subsistence needs to be met.
Harbor seals and sea lions have traditionally been taken as part of subsistence harvests in Yakutat. Because of the high hunting pressure harbor seals may avoid areas like Monti Bay and Yakutat Roads where they are easily visible and readily accessible to hunters, although they are still expected to be common within the range of construction impacts. The small boat harbor is the primary access point for subsistence users to the traditional seal hunting grounds in Disenchantment Bay
The proposed project is not likely to adversely impact the availability of any marine mammal species or stocks that are commonly used for subsistence purposes or impact subsistence harvest of marine mammals in the region. Some minor, short-term harassment of Steller sea lions and harbor seals could occur, potentially including displacement from Yakutat Bay and into the surrounding habitat. Displacement is expected to be short-term and temporary, and limited to the immediate project area. Therefore, any effects on subsistence harvest activities in the project areas are expected to be minimal and would not have an adverse impact on overall harvest.
Based on the description of the specified activity, the measures described to minimize adverse effects on the availability of marine mammals for subsistence purposes, and the proposed mitigation and monitoring measures, NMFS has preliminarily determined that there will not be an unmitigable adverse impact on subsistence uses from CBY's proposed activities.
Section 7(a)(2) of the ESA of 1973 (16 U.S.C. 1531
NMFS is proposing to authorize take of humpback whale (Mexico DPS; Mex-North Pacific) and Steller sea lion (western DPS), which are listed under the ESA.
The Permits and Conservation Division has requested initiation of section 7 consultation with the Alaska Regional Office for the issuance of this IHA. NMFS will conclude the ESA consultation prior to reaching a determination regarding the proposed issuance of the authorization.
As a result of these preliminary determinations, NMFS proposes to issue an IHA to CBY for conducting construction activities in Yakutat, Alaska, provided the previously mentioned mitigation, monitoring, and reporting requirements are incorporated. A draft of the proposed IHA can be found at:
We request comment on our analyses, the proposed authorization, and any other aspect of this notice of proposed IHA for the proposed construction. We also request comment on the potential renewal of this proposed IHA as described in the paragraph below. Please include with your comments any supporting data or literature citations to help inform decisions on the request for this IHA or a subsequent renewal IHA.
On a case-by-case basis, NMFS may issue a one-time, 1-year renewal IHA following notice to the public providing an additional 15 days for public comments when (1) up to another year of identical or nearly identical activities as described in the Description of Proposed Activity section of this notice is planned or (2) the activities as described in the Description of Proposed Activity section of this notice would not be completed by the time the IHA expires and a renewal would allow for completion of the activities beyond that described in the
• A request for renewal is received no later than 60 days prior to the needed renewal IHA effective date (recognizing that the renewal IHA expiration date cannot extend beyond 1 year from expiration of the initial IHA).
• The request for renewal must include the following:
1. An explanation that the activities to be conducted under the requested renewal IHA are identical to the activities analyzed under the initial IHA, are a subset of the activities, or include changes so minor (
2. A preliminary monitoring report showing the results of the required monitoring to date and an explanation showing that the monitoring results do not indicate impacts of a scale or nature not previously analyzed or authorized.
• Upon review of the request for renewal, the status of the affected species or stocks, and any other pertinent information, NMFS determines that there are no more than minor changes in the activities, the mitigation and monitoring measures will remain the same and appropriate, and the findings in the initial IHA remain valid.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice; proposed incidental harassment authorization; request for comments on proposed authorization and possible renewal.
NMFS has received a request from the Ketchikan Dock Company, LLC for authorization to take marine mammals incidental to construction work for the Ketchikan Berth IV Expansion Project in Ketchikan, Alaska in the East Tongass Narrows. Pursuant to the Marine Mammal Protection Act (MMPA), NMFS is requesting comments on its proposal to issue an incidental harassment authorization (IHA) to incidentally take marine mammals during the specified activities. NMFS is also requesting comments on a possible one-time, 1-year renewal that could be issued under certain circumstances and if all requirements are met, as described in Request for Public Comments at the end of this notice. NMFS will consider public comments prior to making any final decision on the issuance of the requested MMPA authorization and agency responses will be summarized in the final notice of our decision.
Comments and information must be received no later than October 30, 2025.
Comments should be addressed to Permits and Conservation Division, Office of Protected Resources, National Marine Fisheries Service and should be submitted via email to
Kelsey Potlock, Office of Protected Resources, NMFS, (301) 427-8401.
The MMPA prohibits the “take” of marine mammals, with certain exceptions. Sections 101(a)(5)(A) and (D) of the MMPA (16 U.S.C. 1361
Authorization for incidental takings shall be granted if NMFS finds that the taking will have a negligible impact on the species or stock(s) and will not have an unmitigable adverse impact on the availability of the species or stock(s) for taking for subsistence uses (where relevant). Further, NMFS must prescribe the permissible methods of taking and other “means of effecting the least practicable adverse impact” on the affected species or stocks and their habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance, and on the availability of the species or stocks for taking for certain subsistence uses (collectively referred to as “mitigation”); and requirements pertaining to the monitoring and reporting of the takings. The definitions of all applicable MMPA statutory terms used above are included in the relevant sections below and can be found in section 3 of the MMPA (16 U.S.C. 1362) and NMFS regulations at 50 CFR 216.103.
To comply with the National Environmental Policy Act of 1969 (NEPA; 42 U.S.C. 4321
This action is consistent with categories of activities identified in Categorical Exclusion B4 (IHAs with no anticipated serious injury or mortality) of the Companion Manual for NAO 216-6A, which do not individually or cumulatively have the potential for significant impacts on the quality of the human environment and for which we have not identified any extraordinary circumstances that would preclude this categorical exclusion. Accordingly, NMFS has preliminarily determined that the issuance of the proposed IHA qualifies to be categorically excluded from further NEPA review.
On June 10, 2025, NMFS received a request from the Ketchikan Dock Company, LLC (KDC), for an IHA to take marine mammals incidental to construction activities using pile driving and Down-the-Hole (DTH) drilling in Ketchikan, Alaska in the East Tongass Narrows. Following NMFS' review of the application(s), KDC submitted a revised version on August 1, 2025. The application was deemed adequate and complete on September 2, 2025. KDC's request is for take of 8 species of marine mammals (consisting of 11 stocks) by Level B harassment and, for a subset of these species (
KDC has requested an IHA to authorize marine mammal take incidental to removing and subsequently installing new piles that are necessary in the expansion of Berth IV to accommodate larger cruise ships in the Port of Ketchikan. Since the 2007 construction of Berth IV, the capacity of cruise vessels and larger boats has increased where the current Berth cannot accommodate larger and more modern vessels. This expansion is necessary to support the local economy in Ketchikan as it continues to grow with the cruise and tourism industries.
This proposed project entails only coastal construction activities. Presently, several in-water structures exist that require replacement, including floats, several groups of older piles (referred to as a “dolphin”) (consisting of several different sized piles), float restraints, and catwalks that connect the dolphins. These structures would all be removed at Berth IV and new permanent structures would be installed, including new dolphins (of varying pile sizes), a new pontoon, a new boat float, a new ladder/platform to allow access to dolphins, and new mooring points to aid in the expanded boat capacity of the Berth.
Given the use of vibratory pile driving, impact pile driving, and DTH drilling, there is the potential for marine mammals to be taken by Level A harassment and/or Level B harassment.
The proposed IHA would be valid for the statutory maximum of 1 year from the date of effectiveness. It will become effective upon written notification from the applicant to NMFS, but not beginning later than 1 year from the date of issuance or extending beyond 2 years from the date of issuance. Currently, construction is planned to occur starting on January 2, 2026 and continue for 3 to 4 months (ending sometime around May 2026). Pile removal and installation activities are expected to necessitate approximately 305 hours over 64 (not necessarily consecutive) days. Overall, the proposed project is not expected to last more than 6 months as the current project schedule does consider the mobilization of materials and any potential delays to do the delayed delivery of necessary materials, equipment maintenance, inclement weather, and shutdowns necessary to prevent impacts to any protected species.
The proposed project is located within the City of Ketchikan (Township 75 south, Range 90 east, Section 25 of the Copper River Meridian, U.S. Geological Survey Quadrangle KET B5),
Per the Ketchikan Marine Industry Council, the project site has an approximate mean low low water (MLLW) depth ranging from −40 ft (−12.2 m) to −100 feet (−30.5 m). Tidal currents generally range from 0.3 mi (0.5 km) to 1.6 mi (2.6 km) per hour during flood and ebb tides. At the project site where piles would be driven, water depths range between approximately 60 feet (ft) (18.3 meters (m)) to 160 ft (48.8 m) (Peratrovich and Nottingham Engineers, Inc. (PND), 2006). Tidal currents generally range from 0.3 miles (0.5 km) to 1.6 miles (2.6 km) per hour during flood and ebb tides (PND, 2006). Water depths in Tongass Narrows that would be ensonified are generally 160 ft (48.8 m) or shallower, but they get deeper past the southern end of Pennock Island, reaching depths up to 625 ft (190.5 m) (NOAA, 2015). Major waterbodies near the area include the Clarence Strait to the north, the Revillagigedo Channel to the south, Nichols Passage to the west, and George Inlet to the east. Berth IV's expansion would take place at the existing dock facility.
KDC has proposed to remove and subsequently install piles on the existing Berth IV to expand its capabilities for larger cruise vessels. All piles would be removed, temporarily installed and then subsequently removed, or permanently installed using vibratory pile driving (ICE 44B), impact pile driving (Delmag D46), or using DTH (Holte 100,000 feet-pounds (ft-lbs.) top drive with a DTH hammer and bit). Piles would also be “stabbed” using the crane to position them on the substrate prior to installation. Specifically, the proposed project would require the removal of the following in-water components:
• The existing barge float;
• The existing north float;
• The existing 60-ft (18.3-m) gangway to the north float;
• The floating barge dolphin #1 (consisting of two 30-inch (in (76.2-centimeter (cm))) piles and one 36-in (91.4-cm) pile);
• The floating barge dolphin #2 (consisting of two 30-in (76.2-cm) piles);
• The breasting dolphin #2 (consisting of three 36-in (91.4-cm) piles and two 30-in (76.2-cm) piles);
• The small float restraint (consisting of two 24-in (61-cm) piles); and
• The existing catwalk that connects breasting dolphin #2 and breasting dolphin #1.
In their place, new piles and in-water structures would be installed, including:
• The mooring dolphin #1 (consisting of four 36-in (91.4-cm) steel batter piles);
• The shoreline dolphin #2 (consisting of two 48-in (121.9-cm) steel batter piles and two 48-in (121.9-cm) steel plumb piles);
• The pontoon dolphin #1 (consisting of two 48-in (121.9-cm) steel batter piles and three 48-in (121.9-cm) steel plumb piles);
• The pontoon dolphin #2 (consisting of two 48-in (121.9-cm) steel batter piles, and three 48-in (121.9-cm) steel plumb piles);
• One 50-ft x 285-ft (15.2-m x 86.9-m) floating pontoon; and
• One 12-ft x 220-ft (3.7-m x 67.1-m) small boat float.
Between the removal of the existing piles and the installation of new piles, KDC would also need to temporarily install and remove piles using vibratory pile driving for both installation and removal. These would consist of 20 30-inch (76.2-cm) steel piles installed and removed across approximately 10 days (5 days for installation, 5 days for removal). These are necessary to guide and accurately place the pile templates ahead of the installation of permanent piles.
Section 1.2.4.7 of the application includes the detailed construction sequence, which NMFS refers to but does not reiterate here.
Additionally, KDC would also install several out of water components, including a ladder/platform to allow for access to the existing breasting dolphin and two new mooring points on each of the existing mooring dolphins #1 and #2 (
For these construction activities, KDC would utilize several barges for the in-water activities. Two or three material barges (measuring approximately 250 ft × 76 ft × 15.5 ft (76.2 m × 23.2 m × 4.7 m)) would be used to transport materials from Seattle, Washington to the project site and then to be used on-site as a staging area during construction activities. Traveling from Juneau, Alaska to Ketchikan, one construction barge (either the
Proposed mitigation, monitoring, and reporting measures are described in detail later in this document (please see Proposed Mitigation and Proposed Monitoring and Reporting).
Sections 3 and 4 of the application summarize available information regarding status and trends, distribution and habitat preferences, and behavior and life history of the potentially affected species. NMFS fully considered all of this information, and we refer the reader to these descriptions, instead of reprinting the information. Additional information regarding population trends and threats may be found in NMFS' Stock Assessment Reports (SARs;
Table 2 lists all species or stocks for which take is expected and proposed to be authorized for this activity and summarizes information related to the population or stock, including regulatory status under the MMPA and Endangered Species Act (ESA) and potential biological removal (PBR), where known. PBR is defined by the MMPA as the maximum number of animals, not including natural mortalities, that may be removed from a marine mammal stock while allowing that stock to reach or maintain its optimum sustainable population (as described in NMFS' SARs). While no serious injury or mortality is anticipated or proposed to be authorized here, PBR and annual serious injury and mortality (M/SI) from anthropogenic sources are included here as gross indicators of the status of the species or stocks and other threats.
Marine mammal abundance estimates presented in this document represent the total number of individuals that make up a given stock or the total number estimated within a particular study or survey area. NMFS' stock abundance estimates for most species represent the total estimate of individuals within the geographic area, if known, that comprises that stock. For some species, this geographic area may extend beyond U.S. waters. All managed stocks in this region are assessed in NMFS' draft 2024 Alaska and Pacific SARs. All values presented in table 2 are the most recent available at the time of publication (including from the draft 2024 SARs) and are available online at:
As indicated above, all eight species (with 11 managed stocks) in table 2 temporally and spatially co-occur with the activity to the degree that take is reasonably likely to occur.
For all species except humpback whales, there are no known biologically important areas (BIA) near the project site that KDC's proposed activity would impact. For humpback whales, the inland waters of Southeast Alaska are a seasonal feeding BIA from May through September (Wild
In addition, sea otters (
Hearing is the most important sensory modality for marine mammals underwater, and exposure to anthropogenic sound can have deleterious effects. To appropriately assess the potential effects of exposure to sound, it is necessary to understand the frequency ranges marine mammals are able to hear. Not all marine mammal species have equal hearing capabilities or hear over the same frequency range (
For more detail concerning these groups and associated generalized hearing ranges, please see NMFS (2024) for a review of available information.
This section includes a summary and provides a discussion of the ways in which components of the specified activity may impact marine mammals and their habitat. The Estimated Take of Marine Mammals section later in this document includes a quantitative analysis of the number of individuals that are expected to be taken by this activity. The Negligible Impact Analysis and Determination section considers the content of this section, the Estimated Take of Marine Mammals section, and the Proposed Mitigation section, to draw conclusions regarding the likely impacts of these activities on the reproductive success or survivorship of individuals and whether those impacts are reasonably expected to, or reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.
Acoustic effects on marine mammals during the specified activities are expected to potentially occur from impact and vibratory pile removal and/or installation, and DTH. The effects of underwater noise from KDC's proposed activities have the potential to result in Level B harassment of marine mammals in the action area, and for some marine mammal species as a result of certain activities, Level A harassment.
Overall, the proposed activities include the removal and installation of old, temporary, and permanent piles in Ketchikan, Alaska. There are a variety of types and degrees of effects to marine mammals, prey species, and habitat that could occur as a result of the Project. Below we provide a brief description of the types of sound sources that would be generated by the project, the general impacts from these types of activities, and an analysis of the anticipated impacts on marine mammals from the project, with consideration of the proposed mitigation measures.
Activities associated with the proposed project that have the potential to incidentally take marine mammals through exposure to sound would include impact pile driving for installation, vibratory pile driving for removal and installation, and DTH. Impact hammers typically operate by repeatedly dropping and/or pushing a heavy piston onto a pile to drive the pile into the substrate. Sound generated by impact hammers is impulsive, characterized by rapid rise times and high peak levels, a potentially injurious combination (Hastings and Popper, 2005). Vibratory hammers install piles by vibrating them and allowing the weight of the hammer to push them into the substrate. Vibratory hammers typically produce less sound (
DTH systems use a combination of percussive and drilling mechanisms to advance a hole into the rock, with or without simultaneously advancing a pile/casing into that hole. Drill cuttings and debris at the rock face are removed by an air-lift exhaust through the inside of the pile (Guan and Miner, 2020). Unlike other pile installation methods, at least one sound source during DTH is found at the intersection of the drill tip and the substrate and is often more characteristically a point source rather than a linear source, as in impact and vibratory pile driving. A DTH system is essentially a drill bit that drills through the bedrock using a rotating function like a normal drill, in concert with a hammering mechanism integrated into the DTH hammer to increase speed of progress through the substrate (
DTH systems include both DTH drilling and DTH driving techniques.
During DTH pile driving, the DTH hammer directly strikes a specially designed shoe located at the bottom of the pile, which has wings that have a slightly larger diameter than the pile (
The sounds produced by the DTH methods simultaneously contain both a continuous non-impulsive component from the drilling action and an impulsive component from the hammering effect. Therefore, for purposes of evaluating Level A and Level B harassment under the MMPA, NMFS treats DTH systems as both impulsive (Level A harassment thresholds) and continuous, non-impulsive (Level B harassment thresholds) sound source types simultaneously.
Typical activities for which DTH systems are used include rock socketing and tension or rock anchoring. Rock socketing involves using DTH techniques to create a hole in the bedrock inside which a pile is placed to give it lateral and longitudinal strength as described in DTH drilling, above. Rock sockets are made in bedrock when overlaying sediments are too shallow to adequately secure the bottom portion of a pile using other methods.
The purpose of a tension anchor is to secure a pile to the bedrock to withstand uplift forces. Tension anchors are installed within production piles that are installed into the substrate below the elevation of the pile tip after the pile has been driven through the sediment layer to refusal. Typically a small diameter casing (
The likely or possible impacts of KDC's proposed activities on marine mammals could involve both non-acoustic and acoustic stressors. Potential non-acoustic stressors could result from the physical presence of the equipment and personnel; however, given there are no known pinniped haul-out sites in the vicinity of the project site, visual and other non-acoustic stressors would be limited, and any impacts to marine mammals are expected to primarily be acoustic in nature.
The introduction of anthropogenic noise into the aquatic environment from vibratory pile driving, impact pile driving, and DTH is the primary means by which marine mammals may be harassed from the KDC's specified activities. Anthropogenic sounds cover a broad range of frequencies and sound levels and can have a range of highly variable impacts on marine life from none or minor to potentially severe responses depending on received levels, duration of exposure, behavioral context, and various other factors. Broadly, underwater sound from active acoustic sources, such as those in the proposed project, can potentially result in one or more of the following: temporary or permanent hearing impairment, non-auditory physical or physiological effects, behavioral disturbance, stress, and masking (Richardson
We describe the more severe effects of certain non-auditory physical or physiological effects only briefly as we do not expect that the use of impact/vibratory hammers and DTH are reasonably likely to result in such effects (see below for further discussion). Potential effects from impulsive sound sources can range in severity from effects such as behavioral disturbance or tactile perception to physical discomfort, slight injury of the internal organs and the auditory system, or mortality (Yelverton
In general, animals exposed to natural or anthropogenic sound may experience physical and psychological effects, ranging in magnitude from none to severe (Southall
The degree of effect of an acoustic exposure on marine mammals is dependent on several factors, including, but not limited to, sound type (
Below, we provide additional detail regarding potential impacts on marine mammals and their habitat from noise in general, starting with hearing impairment, as well as from the specific activities KDC plans to conduct, to the degree it is available.
Depending on the degree (elevation of threshold in dB), duration (
Many studies have examined noise-induced hearing loss in marine mammals (see Finneran (2015) and Southall
The amount and onset of TTS depends on the exposure frequency. Sounds below the region of best sensitivity for a species or hearing group are less hazardous than those near the region of best sensitivity (Finneran and Schlundt, 2013). At low frequencies, onset-TTS exposure levels are higher compared to those in the region of best sensitivity (
Relationships between TTS and AUD INJ thresholds have not been studied in marine mammals, and there are no measured PTS data for cetaceans, but such relationships are assumed to be similar to those in humans and other terrestrial mammals. AUD INJ typically occurs at exposure levels at least several dB above that inducing mild TTS (
Behavioral responses to sound are highly variable and context-specific and any reactions depend on numerous intrinsic and extrinsic factors (
Habituation can occur when an animal's response to a stimulus wanes with repeated exposure, usually in the absence of unpleasant associated events (Wartzok
As noted above, behavioral state may affect the type of response. For example, animals that are resting may show greater behavioral change in response to disturbing sound levels than animals that are highly motivated to remain in an area for feeding (Richardson
Available studies show wide variation in response to underwater sound; therefore, it is difficult to predict specifically how any given sound in a particular instance might affect marine mammals perceiving the signal (
Disruption of feeding behavior can be difficult to correlate with anthropogenic sound exposure, so it is usually inferred by observed displacement from known foraging areas, the appearance of secondary indicators (
Respiration rates vary naturally with different behaviors and alterations to breathing rate as a function of acoustic exposure can be expected to co-occur with other behavioral reactions, such as a flight response or an alteration in diving. However, respiration rates in and of themselves may be representative of annoyance or an acute stress response. Various studies have shown that respiration rates may either be unaffected or could increase, depending on the species and signal characteristics, again highlighting the importance in understanding species differences in the tolerance of underwater noise when determining the potential for impacts resulting from anthropogenic sound exposure (
Avoidance is the displacement of an individual from an area or migration path as a result of the presence of a sound or other stressors, and is one of the most obvious manifestations of disturbance in marine mammals (Richardson
A flight response is a dramatic change in normal movement to a directed and rapid movement away from the perceived location of a sound source. The flight response differs from other avoidance responses in the intensity of the response (
Behavioral disturbance can also impact marine mammals in more subtle ways. Increased vigilance may result in costs related to diversion of focus and attention (
Many animals perform vital functions, such as feeding, resting, traveling, and socializing, on a diel cycle (24-hour cycle). Disruption of such functions resulting from reactions to stressors such as sound exposure are more likely to be significant if they last more than one diel cycle or recur on subsequent days (Southall
Neuroendocrine stress responses often involve the hypothalamus-pituitary-adrenal system. Virtually all stress-related neuroendocrine functions that are affected by stress—including immune competence, reproduction, metabolism, and behavior—are regulated by pituitary hormones. Stress-induced changes in the secretion of pituitary hormones have been implicated in failed reproduction, altered metabolism, reduced immune competence, and behavioral disturbance (
The primary distinction between stress (which is adaptive and does not normally place an animal at risk) and “distress” is the cost of the response. During a stress response, an animal uses glycogen stores that can be quickly replenished once the stress is alleviated. In such circumstances, the cost of the stress response would not pose serious fitness consequences. However, when an animal does not have sufficient energy reserves to satisfy the energetic costs of a stress response, energy resources must be diverted from other functions. This state of distress would last until the animal replenishes its energetic reserves sufficient to restore normal function.
Relationships between these physiological mechanisms, animal behavior, and the costs of stress responses are well studied through controlled experiments and for both laboratory and free-ranging animals (
Marine mammals vocalize for different purposes and across multiple modes, such as whistling, echolocation click production, calling, and singing. Changes in vocalization behavior in response to anthropogenic noise can occur for any of these modes and may result from a need to compete with an increase in background noise or may reflect increased vigilance or a startle response. For example, in the presence of potentially masking signals, humpback whales and killer whales have been observed to increase the length of their songs (Miller
Under certain circumstances, marine mammals experiencing significant masking could also be impaired from maximizing their performance fitness in survival and reproduction. Therefore, when the coincident (masking) sound is human-made, it may be considered harassment when disrupting or altering critical behaviors. It is important to distinguish TTS and PTS, which persist after the sound exposure, from masking, which occurs during the sound exposure. Because masking (without resulting in TS) is not associated with abnormal physiological function, it is
The frequency range of the potentially masking sound is important in determining any potential behavioral impacts. For example, low-frequency signals may have less effect on high-frequency echolocation sounds produced by odontocetes but are more likely to affect detection of mysticete communication calls and other potentially important natural sounds such as those produced by surf and some prey species. The masking of communication signals by anthropogenic noise may be considered as a reduction in the communication space of animals (
Masking occurs in the frequency band that the animals utilize, and is more likely to occur in the presence of broadband, relatively continuous noise sources such as vibratory pile driving. Energy distribution of vibratory pile driving sound covers a broad frequency spectrum, and is anticipated to be within the audible range of marine mammals present in the proposed action area. Since noises generated from the proposed construction activities are mostly concentrated at low frequencies (<2 kHz), these activities likely have less effect on mid-frequency echolocation sounds produced by odontocetes (toothed whales). However, lower frequency noises are more likely to affect detection of communication calls and other potentially important natural sounds such as surf and prey noise. Low-frequency noise may also affect communication signals when they occur near the frequency band for noise and thus reduce the communication space of animals (
While in some cases marine mammals have exhibited little to no obviously detectable response to certain common or routine industrialized activities (Cornick
Any airborne noise would primarily be an issue for swimming or hauled-out pinnipeds near the project site, within the range of noise levels above the acoustic thresholds. We recognize that pinnipeds in the water could be exposed to airborne sound that may result in behavioral harassment when looking with their heads above water. Most likely, airborne sound would cause behavioral responses similar to those discussed above in relation to underwater sound. For instance, anthropogenic sound could cause hauled-out pinnipeds to exhibit changes in their normal behavior, such as reduction in vocalizations, or cause them to flush from haul outs, temporarily abandon the area, and or move further from the source. However, these animals would previously have been `taken' because of exposure to underwater sound above the behavioral harassment thresholds, which are in all cases larger than those associated with airborne sound. Additionally, there are no haul outs near the project site. Thus, the behavioral harassment of these animals is already accounted for in these estimates of potential take. Therefore, we do not believe that authorization of incidental take resulting from airborne sound for pinnipeds is warranted, and airborne sound is not discussed further here.
KDC's proposed construction activities could have localized, temporary impacts on marine mammal habitat, including and their prey, by increasing in-water SPLs and slightly decreasing water quality. Increased noise levels may affect the acoustic habitat (see masking discussion above) and adversely affect marine mammal prey in the vicinity of near the project areas (see discussion below). During DTH, impact, and vibratory pile driving or removal, elevated underwater noise levels would ensonify the project areas where both fish and mammals occur and could affect foraging success. Additionally, marine mammals may avoid the area during the proposed construction activities; however, displacement due to noise is expected to
As previously mentioned, the project area does not contain habitat of known importance other than being designated as a feeding BIA for humpback whales between May and September. While the entirety of southeast Alaska is considered a feeding BIA for humpback whales, Tongass Narrows represents only a tiny segment. Additionally, the project area is highly influenced by anthropogenic activities.
The total seafloor area likely impacted by KDC's activities is relatively small compared to the vast foraging area available habitat in southeast Alaska. At best, the impact area provides marginal foraging habitat for marine mammals and fish. Furthermore, pile driving and removal at the project site would not obstruct the movement or migration of marine mammals.
A temporary and localized increase in turbidity near the seafloor would occur in the immediate area due to the area where piles are installed or removed. In general, turbidity associated with pile installation is localized to about a 25-ft (7.6-m) radius around the pile. The sediments of the project site would settle out rapidly when disturbed. Cetaceans are not expected to be close enough to the pile-driving areas to experience the effects of turbidity, and any pinnipeds could avoid localized turbid areas. Depending on the tidal stage, local strong currents are anticipated to disburse any additional suspended sediments produced by project activities at moderate to rapid rates. Therefore, we expect the impact from increased noise is turbidity levels to be discountable to marine mammals and do not discuss it further.
The potential for prey (
The proposed project will occur within the same footprint as existing marine infrastructure. The nearshore and intertidal habitat where the proposed project will occur is an area of relatively high marine vessel traffic. Most marine mammals do not generally use the area within the footprint of the project area. Temporary, intermittent, and short-term habitat alteration may result from increased noise levels during the proposed construction activities. Effects on marine mammals will be limited to temporary displacement from pile installation and removal noise, and effects on prey species will be similarly limited in time and space.
Impacts to water quality from DTH are expected to be similar to those described for pile driving. Impacts to water quality would be localized and temporary and would have negligible impacts on marine mammal habitat. Drilling would have negligible impacts on water quality from sediment resuspension because the system would operate within a casing set into the bedrock. The drill would collect excavated material inside of the apparatus where it would be lifted to the surface and placed onto a barge for subsequent disposal.
Effects to turbidity and sedimentation are expected to be short-term, minor, and localized. Since there may be currents that are strong in the area, following the completion of sediment-disturbing activities, suspended sediments in the water column should dissipate and quickly return to background levels in all construction scenarios. Turbidity within the water column has the potential to reduce the level of oxygen in the water and irritate the gills of prey fish species in the proposed project area. However, turbidity plumes associated with the project would be temporary and localized, and fish in the proposed project area would be able to move away from and avoid the areas where plumes may occur. Therefore, it is expected that the impacts on prey fish species from turbidity, and therefore on marine mammals, would be minimal and temporary. In general, the area likely impacted by the proposed construction activities is relatively small compared to the available marine mammal habitat in the east Tongass Narrows.
Sound may affect marine mammals through impacts on the abundance, behavior, or distribution of prey species (
Fish utilize the soundscape and components of sound in their environment to perform important functions such as foraging, predator avoidance, mating, and spawning (
Fish react to sounds that are especially strong and/or intermittent low-frequency sounds and behavioral responses such as flight or avoidance are the most likely effects. Sounds that are of short duration and sharp can cause overt or subtle changes in fish behavior and local distribution. The reaction of fish to noise depends on the physiological state of the fish, past exposures, motivation (
SPLs of sufficient strength have been known to cause injury to fish and fish mortality (summarized in Popper
Fish populations in the proposed project area that serve as marine mammal prey could be temporarily affected by noise from pile installation and removal. The frequency range in which fishes generally perceive underwater sounds is 50 to 2,000 Hz, with peak sensitivities below 800 Hz (Popper and Hastings, 2009). Fish behavior or distribution may change, especially with strong and/or intermittent sounds that could harm fishes. High underwater SPLs have been documented to alter behavior, cause hearing loss, and injure or kill individual fish by causing serious internal injury (Hastings and Popper, 2005).
Zooplankton is a food source for several marine mammal species, as well as a food source for fish that are then preyed upon by marine mammals. Population effects on zooplankton could have indirect effects on marine mammals. Data are limited on the effects of underwater sound on zooplankton species, particularly sound from construction (Erbe
The greatest potential impact to marine mammal prey during construction would occur during impact pile driving, vibratory pile driving, and DTH. Impact pile driving, vibratory pile driving, and DTH could possibly elicit behavioral reactions from fishes such as temporary avoidance of the area but is unlikely to cause injuries to fishes or have persistent effects on local fish populations. Construction also would have minimal permanent and temporary impacts on benthic invertebrate species, a marine mammal prey source. In addition, it should be noted that the area in question is low-quality habitat since it is already highly developed and experiences a high level of anthropogenic noise from normal operations and other vessel traffic.
Essential Fish Habitat (EFH) has been designated in the east Tongass Narrows for all five species of salmon (
The proposed project is not expected to result in any habitat related effects that could cause significant or long-term negative consequences for individual marine mammals or their populations, since installation and removal of in-water piles would be temporary and intermittent. The total seafloor area affected by pile installation and removal is a very small area compared to the vast foraging area available to marine mammals outside this project area. Although Southeast Alaska in its entirety is listed as a BIA for humpback whales (Wild
In summary, given the relatively small areas being affected, as well as the temporary and mostly transitory nature of the proposed construction activities, any adverse effects from KDC's activities on prey habitat or prey populations are expected to be minor and temporary. The most likely impact to fishes at the project site would be temporary avoidance of the area. The most likely impact on fish from DTH and pile driving and removal activities at the project area would be temporary behavioral avoidance of the area. The duration of fish avoidance in this area after pile driving stops is unknown, but a rapid return to regular recruitment, distribution, and behavior is anticipated.
There are times of known seasonal marine mammal foraging in Tongass Narrows around fish processing/hatchery infrastructure or when fish are congregating, but the affected areas of Tongass Narrows are a small portion of the total foraging habitat available in the region. In general, effects on marine mammal prey species are expected to be minor and temporary due to the short timeframe of the project and the small project footprint.
Increased turbidity from construction activities can adversely affect forage fish and juvenile salmonid out-migratory routes in the project area. Both herring and salmon form a significant prey base for Steller sea lions, whereas herring is the primary prey species of humpback whales; both herring and salmon are components of the diet of many other
In summary, given the temporary nature of the construction project and relatively small areas being affected, the DTH and pile driving installation and removal activities associated with the proposed action are not likely to have a permanent, adverse effect on any fish habitat or populations of fish species. Any behavioral avoidance by fish in disturbed areas would still leave significantly large areas of fish and marine mammal foraging habitat in the nearby vicinity. Thus, we preliminarily conclude that the impacts of the specified activities are not likely to have more than short-term adverse effects on any prey habitat or populations of prey species. Further, any impacts to marine mammal habitat are not expected to result in significant or long-term consequences for individual marine mammals, or to contribute to the adverse effects on their populations.
This section provides an estimate of the number of incidental takes proposed for authorization through the IHA, which will inform NMFS' consideration of “small numbers,” the negligible impact determinations, and impacts on subsistence uses.
Harassment is the only type of take expected to result from these activities. Except with respect to certain activities not pertinent here, section 3(18) of the MMPA defines “harassment” as any act of pursuit, torment, or annoyance, which (i) has the potential to injure a marine mammal or marine mammal stock in the wild (Level A harassment); or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering (Level B harassment).
Authorized takes would primarily be by Level B harassment, as use of the acoustic source/s (
As described previously, no serious injury or mortality is anticipated or proposed to be authorized for this activity. Below we describe how the proposed take numbers are estimated.
For acoustic impacts, generally speaking, we estimate take by considering: (1) acoustic criteria above which NMFS believes there is some reasonable potential for marine mammals to be behaviorally harassed or incur some degree of AUD INJ; (2) the area or volume of water that will be ensonified above these levels in a day; (3) the density or occurrence of marine mammals within these ensonified areas; and, (4) the number of days of activities. We note that while these factors can contribute to a basic calculation to provide an initial prediction of potential takes, additional information that can qualitatively inform take estimates is also sometimes available (
NMFS recommends the use of acoustic criteria that identify the received level of underwater sound above which exposed marine mammals would be reasonably expected to be behaviorally harassed (equated to Level B harassment) or to incur AUD INJ of some degree (equated to Level A harassment). We note that the criteria for AUD INJ, as well as the names of two hearing groups, have been recently updated (NMFS, 2024) as reflected below in the Level A harassment section.
KDC's proposed activities includes the use of continuous (vibratory pile driving and DTH) and impulsive (impact pile driving and DTH) sources, and therefore the RMS SPL thresholds of 120 and 160 dB re 1 μPa are applicable.
The 2024 Updated Technical Guidance criteria include both updated
Here, we describe operational and environmental parameters of the activity that are used in estimating the area ensonified above the acoustic thresholds, including source levels and transmission loss coefficient.
The sound field in the project area is the existing background noise plus additional construction noise from the proposed project. Marine mammals are expected to be affected via sound generated by the primary components of the project (
Transmission Loss (
This formula neglects loss due to scattering and absorption, which is assumed to be zero here. The degree to
The ensonified area associated with Level A harassment is more technically challenging to predict due to the need to account for a duration component. Therefore, NMFS developed an optional User Spreadsheet tool to accompany the 2024 Updated Technical Guidance that can be used to relatively simply predict an isopleth distance for use in conjunction with marine mammal density or occurrence to help predict potential takes (found on our website here:
Using the practical spreading model, NMFS determined that the underwater noise would yield the following calculated distances to the Level A harassment and Level B harassment thresholds for marine mammals (see table 9).
It should be noted that, based on the geography of Tongass Narrows and the surrounding islands, the sound would not reach the entire distance of the Level B harassment isopleths. Landmasses would truncate the largest Level B Harassment isopleths. Constraining landmasses include Revillagigedo Island, Gravina Island, Pennock Island, Annette Island, and Bold Island.
In this section, we provide information about the occurrence of marine mammals, including density or other relevant information, which will inform the take calculations. Next, we describe how all of the information described above is synthesized to produce a quantitative estimate of the take that is reasonably likely to occur and proposed for authorization.
In their application, KDC explained that the animal occurrence data was collated based upon protected species monitoring data collected during the Alaska Department of Transportation & Public Facilities' (ADOT&PF) Ferry Berth Improvements projects located in Tongass Narrows, conducted between 2020-2023. These projects and the available monitoring reports can be found on NMFS' website (
To calculate the estimated take that is expected to occur from KDC's proposed activities, species-specific expected occurrence, which is based on group size data and the estimated frequency of appearance expected for each species (table 11), was multiplied by the total number of days that each type of pile driving (
The equation for daily estimated take was used for species whose occurrence was “
While KDC primarily expects take by Level B harassment to occur, a small amount of take by Level A harassment is expected for all low-frequency cetaceans, very high-frequency cetaceans, phocids, and otariids. Table 11 shows if the estimated takes for each species were calculated on a monthly or daily basis, based on the observation and sighting data available. The proposed takes are shown in table 12.
In order to issue an IHA under section 101(a)(5)(D) of the MMPA, NMFS must set forth the permissible methods of taking pursuant to the activity, and other means of effecting the least practicable impact on the species or stock and its habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance, and on the availability of the species or stock for taking for certain subsistence uses (latter not applicable for this action). NMFS regulations require applicants for incidental take authorizations to include information about the availability and feasibility (economic and technological) of equipment, methods, and manner of conducting the activity or other means of effecting the least practicable adverse impact upon the affected species or stocks, and their habitat (50 CFR 216.104(a)(11)).
In evaluating how mitigation may or may not be appropriate to ensure the least practicable adverse impact on species or stocks and their habitat, as well as subsistence uses where applicable, NMFS considers two primary factors:
(1) The manner in which, and the degree to which, the successful implementation of the measure(s) is expected to reduce impacts to marine mammals, marine mammal species or stocks, and their habitat, as well as subsistence uses. This considers the nature of the potential adverse impact being mitigated (likelihood, scope, range). It further considers the likelihood that the measure will be effective if implemented (probability of accomplishing the mitigating result if implemented as planned), the likelihood of effective implementation (probability implemented as planned), and;
(2) The practicability of the measures for applicant implementation, which may consider such things as cost, and impact on operations.
The mitigation requirements described in the following were proposed by KDC in its adequate and complete application or are the result of subsequent coordination between NMFS and KDC. KDC has agreed that all of the mitigation measures are practicable. NMFS has fully reviewed the specified activities and the mitigation measures to determine if the mitigation measures would result in the least practicable adverse impact on marine mammals and their habitat, as required by the MMPA, and has determined the proposed measures are appropriate. NMFS describes these below as proposed mitigation requirements, and has included them in the proposed IHA.
In addition to the measures described later in this section, KDC would follow these general mitigation measures:
• Takes proposed for authorization, by Level A and Level B harassment only, would be limited to the species and numbers listed in table 12. Construction activities would be required to be halted upon observation of either a species for which incidental take was not authorized or for a species for which incidental take has been authorized but the number of takes has been met, entering or is within the harassment zone, if the IHA is issued.
• The taking by serious injury or death of any of the species listed in table 12 or any taking of any other species of marine mammal would be prohibited and would result in the modification, suspension, or revocation of the IHA, if issued. Any taking exceeding the authorized amounts listed in table 12 would be prohibited and would result in the modification, suspension, or revocation of the IHA, if issued;
• Ensure that construction supervisors and crews, the marine mammal monitoring team, and relevant KDC staff are trained prior to the start of all construction activities, so that responsibilities, communication procedures, marine mammal monitoring protocol, and operational procedures are clearly understood. New personnel joining during the project must be trained prior to commencing work;
• KDC, construction supervisors and crews, PSOs, and relevant KDC staff must avoid direct physical interaction with marine mammals during construction activity. If a marine mammal comes within 10 m (32.8 ft) of such activity, operations must cease and vessels must reduce speed to the minimum level required to maintain steerage and safe working conditions, as necessary to avoid direct physical interaction;
• Employ PSOs and establish monitoring locations as described in the Protected Species Monitoring and Mitigation Plan (PSMMP) (see NMFS' website). KDC must monitor the project area to the maximum extent possible based on the required number of PSOs, required monitoring locations, and environmental conditions;
• KDC also would abide by the reasonable and prudent measures and terms and conditions of a Biological Opinion and Incidental Take Statement, if issued by NMFS, pursuant to Section 7 of the ESA.
Additionally, the following mitigation measures apply to KDC's in-water construction activities.
KDC would be required to establish pre- and post-monitoring zones with radial distances (based on the distances to the Level B harassment threshold), as identified in table 13, for all construction activities.
Monitoring would take place from 30 minutes prior to initiation of any pile driving activity (
KDC would use soft start techniques when impact pile driving. Soft-start requires contractors to provide an initial set of three strikes at reduced energy, followed by a 30-second waiting period, then two subsequent reduced-energy strike sets. A soft-start would be implemented at the start of each day's impact pile driving and at any time following cessation of impact pile driving for a period of 30 minutes or longer. Soft-start procedures are used to provide additional protection to marine mammals by providing warning and/or giving marine mammals a chance to leave the area prior to the hammer operating at full capacity.
KDC would establish shutdown zones with radial distances as identified in table 14 for all construction activities. The purpose of a shutdown zone is generally to define an area within which shutdown of the activity would occur upon sighting of a marine mammal (or in anticipation of an animal entering the defined area). Shutdown zones would vary based on the activity type and marine mammal hearing group. If a marine mammal is observed entering or within the shutdown zones indicated in table 14, pile driving and DTH activities must be delayed or halted. If pile driving is delayed or halted due to the presence of a marine mammal, the activity may not commence or resume until either the animal has voluntarily exited and been visually confirmed beyond the shutdown zones or a specific time period has passed without re-detection of the animal (
KDC would use a bubble curtain during impact pile driving. The bubble curtain would be operated as necessary to achieve optimal performance. At a minimum, the bubble curtain would distribute air bubbles around 100 percent of the piling circumference for the full depth of the water column, the lowest bubble ring would be in contact with the substrate for the full circumference of the ring, and the weights attached to the bottom ring would ensure 100 percent substrate contact. No parts of the ring or other objects would prevent full substrate contact. In addition, airflow to the bubblers would be balanced around the circumference of the pile.
Based on our evaluation of the applicant's proposed measures, NMFS has preliminarily determined that the proposed mitigation measures provide the means of effecting the least practicable impact on the affected species or stocks and their habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance.
In order to issue an IHA for an activity, section 101(a)(5)(D) of the MMPA states that NMFS must set forth requirements pertaining to the monitoring and reporting of such taking. The MMPA implementing regulations at 50 CFR 216.104(a)(13) indicate that requests for authorizations must include the suggested means of accomplishing the necessary monitoring and reporting that will result in increased knowledge of the species and of the level of taking or impacts on populations of marine mammals that are expected to be present while conducting the activities. Effective reporting is critical both to compliance as well as ensuring that the most value is obtained from the required monitoring.
Monitoring and reporting requirements prescribed by NMFS should contribute to improved understanding of one or more of the following:
• Occurrence of marine mammal species or stocks in the area in which take is anticipated (
• Nature, scope, or context of likely marine mammal exposure to potential stressors/impacts (individual or cumulative, acute or chronic), through better understanding of: (1) action or environment (
• Individual marine mammal responses (behavioral or physiological) to acoustic stressors (acute, chronic, or cumulative), other stressors, or cumulative impacts from multiple stressors;
• How anticipated responses to stressors impact either: (1) long-term fitness and survival of individual marine mammals; or (2) populations, species, or stocks;
• Effects on marine mammal habitat (
• Mitigation and monitoring effectiveness.
The monitoring and reporting requirements described in the following were proposed by KDC in its adequate and complete application and PSMMP, or are the result of subsequent coordination between NMFS and KDC following receipt of the application. KDC has agreed that all of the mitigation measures are appropriate. NMFS describes these below as proposed requirements, and has included them in the proposed IHA.
All PSOs must be NMFS-approved. PSOs would be independent of the activity contractor (for example, employed by a subcontractor) and have no other assigned tasks during monitoring periods. At least one PSO would have prior experience performing the duties of a PSO during an activity pursuant to a NMFS-issued Incidental Take Authorization (ITA). Other PSOs may substitute other relevant experience (including relevant Alaska Native traditional knowledge), education (degree in biological science or related field), or training for prior experience performing the duties of a PSO during construction activity pursuant to a NMFS-issued incidental take authorization.
Additionally, PSOs would be required to meet the following qualifications:
• The ability to conduct field observations and collect data according to assigned protocols;
• Experience or training in the field identification of marine mammals, including the identification of behaviors;
• Sufficient training, orientation, or experience with the construction operation to provide for personal safety during observations;
• Writing skills sufficient to prepare a report of observations including but not limited to:
(1) Number and species of marine mammals observed;
(2) Dates and times when in-water construction activities were conducted;
(3) Dates, times, and reason for implementation of mitigation (or why mitigation was not implemented when required); and
(4) Marine mammal behavior.
• The ability to communicate orally, by radio or in person, with Project personnel to provide real-time information on marine mammals observed in the area as necessary.
Where a team of three or more PSOs is required, a lead observer or monitoring coordinator would be designated. The lead observer must have prior experience performing the duties of a PSO during construction activity pursuant to a NMFS-issued ITA or Letter of Concurrence.
KDC must establish monitoring locations as described in PSMMP (see NMFS' website). For all pile driving activities, a minimum of one PSO must be assigned to each active pile driving and DTH location to monitor the applicable shutdown zones. The specific locations of the PSOs will be based on project activities and are as follows (in alignment with the PSMMP (see figure 2)):
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•
•
•
As described in the PSMMP, the number and locations of monitors will be based on the following in-water work scenarios:
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•
At all locations, all PSOs, to the extent practicable, must use an elevator platform at observation points to enhance observation ability. PSOs would be required to record all observations of marine mammals, regardless of distance from the pile being driven, as well as the additional data indicated below and in section 6 of the IHA, if issued.
KDC would be required to submit an annual draft summary report on all construction activities and marine mammal monitoring results to NMFS within 90 days following the end of construction or 60 calendar days prior to the requested issuance of any subsequent IHA for similar activity at the same location, whichever comes first. The draft summary report would include an overall description of construction work completed, a narrative regarding marine mammal sightings, and associated raw PSO data sheets (in electronic spreadsheet format). Specifically, the report must include:
• Dates and times (begin and end) of all marine mammal monitoring;
• Construction activities occurring during each daily observation period, including: (a) how many and what type of piles were driven or removed and the method (
• PSO locations during marine mammal monitoring; and
• Environmental conditions during monitoring periods (at beginning and end of PSO shift and whenever conditions change significantly), including Beaufort sea state and any other relevant weather conditions including cloud cover, fog, sun glare, and overall visibility to the horizon, and estimated observable distance.
Upon observation of a marine mammal, the following information must be reported:
• Name of PSO who sighted the animal(s) and PSO location and activity at the time of the sighting;
• Time of the sighting;
• Identification of the animal(s) (
• Distance and bearing of each observed marine mammal relative to the pile being driven or removed for each sighting;
• Estimated number of animals (min/max/best estimate);
• Estimated number of animals by cohort (
• Animal's closest point of approach and estimated time spent within the estimated harassment zone(s);
• Description of any marine mammal behavioral observations (
• Number of marine mammals detected within the estimated harassment zones, by species; and
• Detailed information about implementation of any mitigation (
If no comments are received from NMFS within 30 days after the submission of the draft summary report, the draft report would constitute the final report. If KDC received comments from NMFS, a final summary report addressing NMFS' comments would be submitted within 30 days after receipt of comments.
In the event that personnel involved in KDC's activities discover an injured or dead marine mammal, KDC would report the incident to the NMFS Office of Protected Resources (OPR) (
• Description of the incident;
• Environmental conditions (
• Description of all marine mammal observations in the 24 hours preceding the incident;
• Photographs or video footage of the animal(s) (if equipment is available).
• Time, date, and location (latitude/longitude) of the first discovery (and updated location information if known and applicable);
• Species identification (if known) or description of the animal(s) involved;
• Condition of the animal(s) (including carcass condition if the animal is dead);
• Observed behaviors of the animal(s), if alive; and
• General circumstances under which the animal was discovered.
NMFS has defined negligible impact as an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival (50 CFR 216.103). A negligible impact finding is based on the lack of likely adverse effects on annual rates of recruitment or survival (
To avoid repetition, the discussion of our analysis applies to all the species listed in table 12, given that the anticipated effects of this activity on these different marine mammal stocks are expected to be similar. There is little information about the nature or severity of the impacts, or the size, status, or structure of any of these species or stocks that would lead to a different analysis for this activity.
Pile driving for installation and removal, and DTH activities associated with the proposed Project, as outlined previously, have the potential to disturb or displace marine mammals. Specifically, the specified activities may result in take in the form of Level A harassment and/or Level B harassment from underwater sounds generated from pile driving installation and removal. Potential takes could occur if individuals of these species are present in zones ensonified above the thresholds for Level A harassment or
Given the nature of the proposed activities, NMFS does not anticipate serious injury or mortality due to KDC's proposed project, even in the absence of required mitigation. The Level A harassment zones identified in table 14 are based upon an animal exposed to vibratory pile driving, impact pile driving, and DTH pile installation for periods ranging from up to 15 minutes for impact driving per day, up to 120 minutes for vibratory driving/removal per day), and up to 960 minutes for DTH per day. Exposures of this length are, however, unlikely for vibratory driving/removal and DTH pile installation scenarios, given marine mammal movement throughout the area. Even during impact driving scenarios, an animal exposed to the accumulated sound energy would likely only experience limited AUD INJ at the lower frequencies where pile driving energy is concentrated.
As stated in the Proposed Mitigation section, KDC would implement shutdown zones that equal or exceed many of the Level A harassment isopleths shown in table 14. Take by Level A harassment is proposed for seven marine mammal species (eight stocks). This is precautionary to account for the potential that an animal could enter and remain within the area between a Level A harassment zone and the shutdown zone for long enough to be taken by Level A harassment. Additionally, in some cases, this precaution would account for the possibility that an animal could enter a shutdown zone without detection, given the various obstructions along the shoreline, and remain in the Level A harassment zone for a duration long enough to be taken by Level A harassment before being observed and a shutdown occurring. That said, any take by Level A harassment is expected to arise from, at most, a small degree of AUD INJ because animals would need to be exposed to higher levels and/or longer duration than are expected to occur here to incur any more than a small degree of AUD INJ. Additionally, and as noted previously, some subset of the individuals that are behaviorally harassed could also simultaneously incur some small degree of TTS for a short duration of time. Because of the small degree anticipated, any AUD INJ or TTS potentially incurred here is not expected to adversely affect an animal's individual fitness, let alone annual rates of recruitment or survival.
For all species and stocks, take is expected to occur within a limited, confined area (adjacent to the project site) of the stock's range. The intensity and duration of take by Level A harassment and Level B harassment would be expected to be minimized through the proposed mitigation measures described herein. Furthermore, the amount of take proposed for authorization is small compared to the relative stock's abundance, even assuming that every take for any particular species could wholly occur to individuals of an individual stock.
Behavioral responses of marine mammals to pile driving, pile removal, and DTH at the project site, if any, are expected to be mild, short-term, and temporary. Given that the installation of 18 permanent piles and 20 temporary piles would occur over 14 days in total (9 for permanent piles, 5 for temporary piles), and that the removal of 12 existing piles and 20 temporary piles would occur over 4 and 5 days, respectively, (all of which may not necessarily be consecutive), any harassment is expected to be temporary and intermittent. Marine mammals within the Level B harassment zones may not show any visual cues they are disturbed by activities or they could become alert, avoid the area, leave the area, or display other mild responses that are not observable, such as changes in vocalization patterns. Additionally, many of the species present in region would only be present temporarily based on seasonal patterns or during active transit between other habitats. Most likely, during pile driving, individuals would be expected to move away from the sound source and be temporarily displaced from the areas of pile driving. However, this reaction has been observed primarily associated with impact pile driving. While vibratory driving associated with the proposed project may produce sound at distances of many kilometers from the project site, thus overlapping with some likely less-disturbed habitat, the project site itself is located in a busy harbor, and the majority of sound fields produced by the specified activities are close to the harbor. Animals disturbed by project sounds would be expected to avoid the area and use nearby higher-quality habitats. Pinnipeds in the area would have the ability to haul-out to avoid the activities (noting that the known haul-outs are located much further away from the project area) and no in-air harassment is anticipated from the construction activities.
The potential for harassment is minimized by implementing the proposed mitigation measures. During all impact driving, implementation of soft-start procedures and monitoring of established shutdown zones by trained and qualified PSOs shall be required, significantly reducing any possibility of injury. Given sufficient notice through soft-start (for impact driving), marine mammals are expected to move away from an irritating sound source before it becomes potentially injurious.
Any impacts on marine mammal prey that would occur during KDC's proposed activities would have, at most, short-term effects on foraging of individual marine mammals, and likely no effect on the populations of marine mammals as a whole. Indirect effects on marine mammal prey during the construction are expected to be minor, and these effects are unlikely to cause substantial effects on marine mammals at the individual level, with no expected effect on annual rates of recruitment or survival.
The area likely impacted by the project is relatively small compared to the available habitat in the surrounding waters of Southeast Alaska and Tongass Narrows. Although Tongass Narrows is part of an identified BIA for feeding humpback whales (NOAA, 2023; Wild
In addition, it is unlikely that minor noise effects in a small, localized area of habitat would have any effect on the reproduction or survival of any individuals, much less the stocks' annual rates of recruitment or survival. In combination, we believe that these factors, as well as the available body of evidence from other similar activities, demonstrate that the potential effects of the specified activities would have only minor, short-term effects on individuals. As already said, the specified activities are not expected to impact rates of recruitment or survival; therefore, these effects would not be expected to result in population-level impacts.
In summary and as described above, the following factors primarily support our preliminary determination that the impacts resulting from this activity are not expected to adversely affect any of the species or stocks through effects on annual rates of recruitment or survival:
• No serious injury or mortality is anticipated or proposed for authorization;
• Any Level A harassment exposures are anticipated to result in slight AUD INJ (
• The anticipated incidents of Level B harassment would consist of, at worst, temporary modifications in behavior that would not result in fitness impacts to individuals;
• The area affected by the specified activity is very small relative to the overall habitat ranges of all species, does not include any rookeries, does not include ESA-designated critical habitat, and only temporally overlaps with the southeast Alaska humpback whale feeding BIA for a minimal amount of time in May, depending on when the activities are expected to be completed (
• Effects on species that serve as prey for marine mammals from the activities are expected to be short-term and, therefore, any associated impacts on marine mammal feeding are not expected to result in significant or long-term consequences for individuals, or to accrue to adverse impacts on their populations;
• Although Steller sea lions and harbor seals are known to haul-out, these haul-out locations are located over 7.55 km (4.69 mi) to 30 km (18.6 mi) away from the proposed project site (depending on the species), which is outside of the ensonified zone;
• The project area is located in an industrialized and commercial marina; and
• The proposed mitigation measures, such as employing vibratory driving to the maximum extent practicable, soft-starts, and shutdowns, are expected to reduce the effects of the specified activity to the least practicable adverse impact level.
Based on the analysis contained herein of the likely effects of the specified activity on marine mammals and their habitat, and taking into consideration the implementation of the proposed monitoring and mitigation measures, NMFS preliminarily finds that the total marine mammal take from the proposed activity will have a negligible impact on all affected marine mammal species or stocks.
As noted previously, only take of small numbers of marine mammals may be authorized under sections 101(a)(5)(A) and (D) of the MMPA for specified activities other than military readiness activities. The MMPA does not define small numbers and so, in practice, where estimated numbers are available, NMFS compares the number of individuals taken to the most appropriate estimation of abundance of the relevant species or stock in our determination of whether an authorization is limited to small numbers of marine mammals. When the predicted number of individuals to be taken is fewer than one-third of the species or stock abundance, the take is considered to be of small numbers (see 86 FR 5322, January 19, 2021). Additionally, other qualitative factors may be considered in the analysis, such as the temporal or spatial scale of the activities.
NMFS is proposing to authorize incidental take by Level A harassment (in some cases) and/or Level B harassment of eight species (consisting of 11 stocks) of marine mammals. No mortality or serious injury has been requested, nor is it anticipated to occur from the activities described herein. The maximum number of instances of takes by Level A harassment and Level B harassment proposed, relative to the best available population abundance, is less than one-third for all species and stocks potentially impacted (see table 12).
Based on the analysis contained herein of the proposed activity (including the proposed mitigation and monitoring measures) and the anticipated take of marine mammals, NMFS preliminarily finds that small numbers of marine mammals would be taken relative to the population size of the affected species or stocks.
In order to issue an IHA, NMFS must find that the specified activity will not have an “unmitigable adverse impact” on the subsistence uses of the affected marine mammal species or stocks by Alaskan Natives. NMFS has defined “unmitigable adverse impact” in 50 CFR 216.103 as an impact resulting from the specified activity: (1) that is likely to reduce the availability of the species to a level insufficient for a harvest to meet subsistence needs by: (i) causing the marine mammals to abandon or avoid hunting areas; (ii) directly displacing subsistence users; or (iii) placing physical barriers between the marine mammals and the subsistence hunters; and (2) that cannot be sufficiently mitigated by other measures to increase the availability of marine mammals to allow subsistence needs to be met.
Alaska Natives have historically hunted sea lions and harbor seals in Southeast Alaska for thousands of years. Since surveys of harbor seals and sea lion subsistence hunting in Alaska began in 1992, there has been a noticeable decline in the number of households, which undertake hunting and harvesting of harbor seals, while the number of households undertaking hunting and harvesting activities on sea lions has remained at consistently low levels (Wolfe
Given all of this information, NMFS agrees with KDC's preliminary determination that the proposed project is not likely to adversely affect the availability of any marine mammal species/stocks that would traditionally be used for subsistence purposes, or would affect any subsistence harvest in the region because of the following reasons:
• The proposed construction activities are spatially localized within a discrete area that has been previously developed (
• The proposed activities are expected to be temporary in nature;
• KDC would be required to implement mitigation measures that minimize any disturbance to marine mammals in the action area, including traditionally harvested species;
• NMFS expects that most of the effects on marine mammals would not rise above behavioral impacts (
• No serious injury or mortality is expected to result from the project activities, therefore, the project would not result in a signify ant change to the availability of subsistence resources.
Based on the description of the specified activity, the measures described to minimize adverse effects on the availability of marine mammals for subsistence purposes, and the proposed mitigation and monitoring measures, NMFS has preliminarily determined that there will not be an unmitigable adverse impact on subsistence uses from KDC's proposed activities.
Section 7(a)(2) of the ESA of 1973 (16 U.S.C. 1531
NMFS is proposing to authorize the take of the Mexico-North Pacific stock of humpback whales, which are listed as threatened under the ESA. The NMFS Office of Protected Resources has requested the initiation of ESA section 7 consultation with AKRO for the issuance of this IHA. NMFS would conclude the ESA consultation before reaching a determination regarding the proposed authorization issuance.
As a result of these preliminary determinations, NMFS proposes to issue an IHA to KDC for conducting the Ketchikan Berth IV Expansion Project in Ketchikan, Alaska in the East Tongass Narrows, provided the previously mentioned mitigation, monitoring, and reporting requirements are incorporated. A draft of the proposed IHA can be found at:
We request comment on our analyses, the proposed authorization, and any other aspect of this notice of proposed IHA for the proposed Ketchikan Berth IV Expansion Project. We also request comment on the potential renewal of this proposed IHA as described in the paragraph below. Please include with your comments any supporting data or literature citations to help inform decisions on the request for this IHA or a subsequent renewal IHA.
On a case-by-case basis, NMFS may issue a one-time, 1-year renewal IHA following notice to the public providing an additional 15 days for public comments when (1) up to another year of identical or nearly identical activities as described in the Description of Proposed Activity section of this notice is planned or (2) the activities as described in the Description of Proposed Activity section of this notice would not be completed by the time the IHA expires and a renewal would allow for completion of the activities beyond that described in the
• A request for renewal is received no later than 60 days prior to the needed renewal IHA effective date (recognizing that the renewal IHA expiration date cannot extend beyond 1 year from expiration of the initial IHA).
• The request for renewal must include the following:
1. An explanation that the activities to be conducted under the requested renewal IHA are identical to the activities analyzed under the initial IHA, are a subset of the activities, or include changes so minor (
2. A preliminary monitoring report showing the results of the required monitoring to date and an explanation showing that the monitoring results do not indicate impacts of a scale or nature not previously analyzed or authorized.
• Upon review of the request for renewal, the status of the affected species or stocks, and any other pertinent information, NMFS determines that there are no more than minor changes in the activities, the mitigation and monitoring measures will remain the same and appropriate, and the findings in the initial IHA remain valid.
National Security Agency (NSA), Department of Defense (DoD).
Notice of intent.
The NSA hereby gives notice of its intent to grant I-Blades, Inc. a revocable, non-assignable, partially exclusive, license to practice the following Government-Owned invention as described and claimed in United States Patent Number/United States Patent Application Number (USPN), 10,866,622 B1, Device for Securing a Charge Operation of an End-User Device.
Anyone wishing to object to the grant of this license has until October 15, 2025 to file written objections including evidence and argument that establish that the grant of the license would not be consistent with the requirements of 35 United States Code (U.S.C.) 209 and 37 CFR 404.7.
Written objections are to be filed with the National Security Agency Technology Transfer Program, 9800 Savage Road, Suite 6843, Fort George G. Meade, MD 20755-6843.
Karen D. Presley, Director, Office of Research and Technology Applications, 9800 Savage Road, Suite 6843, Fort George G. Meade, MD 20755-6843, telephone (443) 634-3519.
The prospective partially exclusive license will comply with the terms and conditions of 35 U.S.C. 209 and 37 CFR 404.7. The patent rights in these inventions have been assigned to the United States Government as represented by the NSA.
Defense Human Resources Activity, Department of Defense (DoD).
Notice of revised per diem Rates in non-foreign areas outside the Continental U.S.
Defense Human Resources Activity publishes this Civilian Personnel Per Diem Bulletin Number 329. Bulletin Number 329 lists current per diem rates prescribed for reimbursement of subsistence expenses while on official Government travel to Alaska, Hawaii, the Commonwealth of Puerto Rico, and the possessions of the United States (U.S.). The Fiscal Year (FY) 2025 lodging and meal rate review for Hawaii resulted in rate changes for multiple locations.
The updated rates take effect October 1, 2025.
Ashley Aguilar, 571-372-1968,
This document notifies the public of revisions in per diem rates prescribed by the Per Diem, Travel, and Transportation Allowance Committee for travel to non-foreign areas outside the continental U.S. The FY 2025 lodging and meal rate review for Hawaii resulted in lodging rate increases for multiple locations. Bulletin Number 329 is published in the
If you believe the lodging, meal or incidental allowance rate for a locality listed in the following table is insufficient, you may request a rate review for that location. For more information about how to request a review, please see the Defense Travel Management Office's Per Diem Rate Review Frequently Asked Questions page at
Defense Security Cooperation Agency, Department of Defense (DoD).
Arms sales notice.
The DoD is publishing the unclassified text of an arms sales notification.
Urooj Zahra at (703) 695-6523,
This 36(b)(1) arms sales notification is published to fulfill the requirements of section 155 of Public Law 104-164 dated July 21, 1996. The following is a copy of a letter to the Speaker of the House of Representatives with attached Transmittal 24-40, Policy Justification, and Sensitivity of Technology.
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* as defined in Section 47(6) of the Arms Export Control Act.
The Government of Denmark has requested to buy eighty-four (84) AIM-120C-8 Advanced Medium-Range Air-to-Air Missiles (AMRAAM) and three (3) AIM-120 AMRAAM guidance sections. Also included is the following
This proposed sale will support the foreign policy goals and national security objectives of the United States by improving the security of a North Atlantic Treaty Organization (NATO) Ally that is a force for political stability and economic progress in Europe.
The proposed sale will improve Denmark's capability to meet current and future threats by ensuring it has modern, capable air-to-air munitions. The sale will further advance the already high level of Danish Air Force interoperability with U.S. Joint Forces and other regional and NATO forces. Denmark already has AMRAAM in its inventory and will have no difficulty absorbing these articles into its armed forces.
The proposed sale of this equipment and support will not alter the basic military balance in the region.
The principal contractor will be RTX Corporation, located in Tucson, AZ. There are no known offset agreements proposed in connection with this potential sale.
Implementation of this proposed sale will not require the assignment of any additional U.S. Government or contractor representatives to Denmark.
There will be no adverse impact on U.S. defense readiness as a result of this proposed sale.
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1. The AIM-120C-8 Advanced Medium-Range Air-to-Air Missile (AMRAAM) is a supersonic, air-launched, aerial intercept guided missile featuring digital technology and microminiature solid-state electronics. AMRAAM capabilities include look-down/shoot-down, multiple launches against multiple targets, resistance to electronic countermeasures, and interception of high and low-flying and maneuvering targets. This potential sale will include AMRAAM guidance sections, control sections, warhead spares, and containers.
2. The highest level of classification of defense articles, components, and services included in this potential sale is SECRET.
3. If a technologically advanced adversary were to obtain knowledge of the specific hardware and software elements, the information could be used to develop countermeasures that might reduce weapon system effectiveness or be used in the development of a system with similar or advanced capabilities.
4. A determination has been made that Denmark can provide substantially the same degree of protection for the sensitive technology being released as the U.S. Government. This sale is necessary in furtherance of the U.S. foreign policy and national security objectives outlined in the Policy Justification.
5. All defense articles and services listed in this transmittal have been authorized for release and export to the Government of Denmark.
Defense Security Cooperation Agency, Department of Defense (DoD).
Arms sales notice.
The DoD is publishing the unclassified text of an arms sales notification.
Urooj Zahra at (703) 695-6523,
This 36(b)(1) arms sales notification is published to fulfill the requirements of section 155 of Public Law 104-164 dated July 21, 1996. The following is a copy of a letter to the Speaker of the House of Representatives with attached Transmittal 24-21, Policy Justification, and Sensitivity of Technology.
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Funding Source: National Funds
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* as defined in Section 47(6) of the Arms Export Control Act.
The Government of Brazil has requested to buy twelve (12) UH-60M Black Hawk helicopters; thirty-four (34) T700-GE-701D engines (24 installed, 10 spares); twenty-eight (28) EAGLE-M Embedded Global Position Systems with Inertial Navigation (EGI) or functional equivalent (24 installed, 4 spares); and twenty-four (24) AN/ARC-231A radio systems. The following non-MDE is also included: AN/PYQ-10 Simple Key Loader (SKL), KIV-77 Common Identification Friend or Foe (IFF) crypto appliques, APX-123A Identification Friend or Foe (IFF) transponders; AN/ARC-231 radio systems; ARC-201D Single Channel Ground and Airborne Radio System (SINCGARS) or functional equivalents; ARC-220 high frequency airborne communication systems or functional equivalents with KY-100M; VRC-100 advanced high frequency ground/vehicular communications systems; ARN-147 navigation receivers; ARN-149 low frequency automatic direction finders; ARN-153 advanced digital Tactical Airborne Navigation (TACAN) receiver-transmitters; APN-209 radar altimeter systems; AN/ARC-210 Gen 6 very high frequency/frequency modulation radios; AN/AVR-2B(V) laser warning systems (provisions only); Airspace Concept Evaluation System (ACES); M-134D-H minigun, mount, power supply, and ammunition handling systems gun and mount accessories package; contractor-provided gun and mount accessories, including spare parts, in support of the M-134D-H minigun systems; Aviation Mission Planning System (AMPS); Aviation Ground Support Equipment (AGSE); HGU-56/P Rotary Wing Helmets (RWH); Advanced Sight Display Computers (ASDC); Common Display Interface Units (CDIU); Wide Color Day Display Module (WCDDM); Wide Color Night Display Module (WCNDM); ADS-B Out ability; Integrated Area Navigation (I-RNAV); RDR-7000 weather radar systems; external rescue hoists; Traffic Collision Avoidance Systems (TCAS); Fast Rope Insertion Extraction System (FRIES); EBC-406HM Emergency Locator Transmitters (ELT); Aircrew Combat Equipment (ACE); Internal Auxiliary Fuel Tank System (IAFTS); technical assistance and logistics support services; publications; and other related elements of logistics and program support. The estimated total cost is $950 million.
This proposed sale will support the foreign policy and national security objectives of the U.S. by helping to improve the security of an important regional partner that is a force for political stability and economic progress in South America.
This proposed sale of UH-60 helicopters will increase Brazil's capability to provide troop transport, border security, medical evacuation, humanitarian assistance and disaster relief, search and rescue, and peacekeeping support. This proposed sale will also promote the United States (U.S.) and Brazil's goal of greater military interoperability. Brazil will have no difficulty absorbing this equipment into its armed forces.
The proposed sale of this equipment and support will not alter the basic military balance in the region.
The principal contractor will be Lockheed Martin, Sikorsky, located in Stratford, CT. There are no known offset agreements proposed in connection with this potential sale. Implementation of this proposed sale will require approximately 15-30 U.S. Government and/or contractor representatives to travel to Brazil.
There will be no adverse impact on U.S. defense readiness as a result of this proposed sale.
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1. The UH-60M Black Hawk is the Army's advanced utility helicopter, and is equipped for performing assault and transport missions in contested environments. The aircraft contains the following sensitive communications, target identification, navigation, aircraft survivability, display, and sensor equipment:
a. The AN/ARC-231A (RT 1987) very high frequency (VHF)/ultra-high frequency (UHF) radio is a multi-mode software-defined radio providing line of sight VHF/UHF secure/non-secure voice and data communications in the 30-941 MHz frequency range and Satellite Communications (SATCOM) beyond line of sight secure/non-secure voice and data including Demand Assigned Multiple ACCESS (DAMA) communications in the 240-320 MHz frequency on manned and unmanned aviation platforms. The ARC-231A includes improved type-1 cryptographic algorithm and processing capabilities, Civil Land Mobile Radio, Single Channel Ground and Airborne Radios System (SINCGARS) capabilities, HAVE QUICK (HQ), Second Generation Anti-Jam Tactical UHF Radio for NATO (SATURN) wave form, 8.33 kHz channel spacing for Global Air-Traffic Management (GATM) compliance, and capability for Mobile User Objective System (MUOS) waveform through possible future hardware and software updates.
b. The AN/ARC-210 is a family of radios for military aircraft that provides two-way, multi-mode voice and data communications in the 30 to 512+ MHz frequency range. It covers both VHF and UHF bands with AM, FM, and SATCOM capabilities. The ARC-210 radio also includes embedded anti-jam waveforms, including HQ and SINCGARS, and other data link and secure communications features providing total battlefield interoperability and high-performance capabilities in the transfer of data, voice, and imagery. The software-programmable encryption is under the National Security Agency's Cryptographic Modernization Initiative.
c. The APX-123A Identification Friend-or-Foe (IFF) digital transponder set provides pertinent platform information in response to an IFF interrogator. The digital transponder provides cooperative Mark XII IFF capability using full diversity selection, as well as Mode Select capability. In addition, transponder operation provides interface capability with the aircraft's Traffic Collision and Avoidance System (TCAS). The transponder receives pulsed radio frequency interrogation signals in any of six modes (1, 2, 3/A, S, and 5), decodes the signals, and transmits a pulse coded reply. The Mark XII IFF operation includes Selective Identification Feature (SIF) Modes 1, 2, 3/A, and C, as well as secure cryptographic Mode 5 operational capability, available upon approval via the Communications Security (COMSEC) approval process.
d. The AN/ARC-231 (RT-1808A) VHF/UHF/LOS SATCOM radio is a software-definable radio for military aircraft that provides two-way, multi-mode voice and data communications in the 30 to 512 MHz frequency range. It covers both line-of-sight VHF and UHF bands with AM, FM, and SATCOM capabilities.
e. The AN/ARC-201D VHF frequency modulation Single Channel Ground and Airborne Radio System (SINCGARS) is a reliable, field-proven voice and data communication system used with the UH-60. A country-unique non-COMSEC export variant of this radio will be provided.
f. The AN/ARC-220 high frequency (HF) airborne communication system provides rotary-wing aircraft with advanced voice and data capabilities for short-and long-distance communications. The system is software programmable with a frequency range of 2-29.9999 MHz in 100-Hz steps and provides for embedded automatic link establishment (ALE), serial tone data modem, text messaging, global positioning system (GPS) position reporting, and electronic countermeasure functions.
g. The VRC-100 HF communication system is the ground station version of the AN/ARC-220 for use in aviation operation centers. It provides advanced voice and data capabilities for short-and long-distance communications. The system is software programmable with a frequency range of 2-29.9999 MHz in 100-Hz steps and provides embedded automatic link establishment (ALE), serial tone data modem, text messaging, GPS position reporting, and electronic countermeasure functions. The system is purchased with all required mounts, amplifiers, antennas, power supplies, and accessories.
h. The KY-100M is a self-contained terminal including COMSEC that provides for secure voice and data communications in air and ground tactical environments. It provides half-duplex, narrowband, and wideband communications. Flexible interfaces ensure compatibility with a wide range of voice, data, radio, and satellite equipment. The KY can support Type 1 cryptography.
i. The AN/PYQ-10 Simple Key Loader (SKL) is a ruggedized, portable, hand-held fill device for securely receiving, storing, and transferring data between compatible cryptographic and communications equipment. The AN/PYQ-10(C) SKL contains an embedded KOV-21 COMSEC card that performs cryptographic functions.
j. The KIV-77 IFF crypto applique provides cryptographic and time-of-day services for a Combined Interrogator/Transponder (CIT) or individual interrogator or transponder Mark XIIA (Mode 4 and Mode 5) IFF system deployed to identify cooperative, friendly systems.
k. The Embedded GPS/Inertial Navigation System (INS) (EGI) provides GPS and INS capabilities to the aircraft. The EGI will include Selective Availability Anti-Spoofing Module (SAASM) security for GPS precision positioning service, if required.
2. The highest level of classification of defense articles, components, and services included in this potential sale is SECRET.
3. If a technologically advanced adversary were to obtain knowledge of the specific hardware and software elements, the information could be used to develop countermeasures that might reduce weapon system effectiveness or be used in the development of a system with similar or advanced capabilities.
4. A determination has been made that the Government of Brazil can provide substantially the same degree of protection for the sensitive technology being released as the U.S. Government. This sale is necessary in furtherance of the U.S. foreign policy and national security objectives outlined in the Policy Justification.
5. All defense articles and services listed in this transmittal are authorized for release and export to the Government of Brazil.
Defense Security Cooperation Agency, Department of Defense (DoD).
Arms sales notice.
The DoD is publishing the unclassified text of an arms sales notification.
Urooj Zahra at (703) 695-6523,
This 36(b)(1) arms sales notification is published to fulfill the requirements of section 155 of Public Law 104-164 dated July 21, 1996. The following is a copy of a letter to the Speaker of the House of Representatives with attached Transmittal 24-42, and Policy Justification.
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* as defined in Section 47(6) of the Arms Export Control Act.
The Taipei Economic and Cultural Representative Office in the United States (TECRO) has requested to buy standard spare and repair parts, components, consumables, and accessories for F-16 aircraft; U.S. Government and contractor engineering, technical, and logistics support services; and other related elements of logistics and program support. The estimated total cost is $220 million.
This proposed sale is consistent with U.S. law and policy as expressed in Public Law 96-8.
This proposed sale serves U.S. national, economic, and security interests by supporting the recipient's continuing efforts to modernize its armed forces and to maintain a credible defensive capability. The proposed sale will help improve the security of the recipient and assist in maintaining political stability, military balance, and economic progress in the region.
The proposed sale will improve the recipient's ability to meet current and future threats by maintaining the operational readiness of the recipient's fleet of F-16 aircraft. The recipient will
The proposed sale of this equipment and support will not alter the basic military balance in the region.
This equipment will be transferred from U.S. Air Force stock. There are no known offset agreements proposed in connection with this potential sale.
Implementation of this proposed sale will not require the assignment of any additional U.S. Government or contractor representatives to the recipient.
There will be no adverse impact on U.S. defense readiness as a result of this proposed sale.
Defense Security Cooperation Agency, Department of Defense (DoD).
Arms sales notice.
The DoD is publishing the unclassified text of an arms sales notification.
Urooj Zahra at (703) 695-6523,
This 36(b)(1) arms sales notification is published to fulfill the requirements of section 155 of Public Law 104-164 dated July 21, 1996. The following is a copy of a letter to the Speaker of the House of Representatives with attached Transmittal 24-47, Policy Justification, and Sensitivity of Technology.
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* as defined in Section 47(6) of the Arms Export Control Act.
The Taipei Economic and Cultural Representative Office in the United States (TECRO) has requested to buy seven hundred twenty (720) Switchblade 300 (SB300) All Up Rounds (AURs) (includes 35 fly-to-buy AURs) and one hundred one (101) SB300 fire control systems (FCS). The following non-Major Defense Equipment will also be included: first line spares packs; operator manuals; operator and maintenance training; logistics and fielding support; Lot Acceptance Testing (LAT); U.S. Government technical assistance, including engineering services, program management, site surveys, facilities, logistics, and maintenance evaluations; quality assurance and de-processing team; field service representative(s); transportation; and other related elements of logistics and program support. The estimated total cost is $60.2 million.
This proposed sale is consistent with U.S. law and policy as expressed in Public Law 96-8.
This proposed sale serves U.S. national, economic, and security interests by supporting the recipient's continuing efforts to modernize its armed forces and to maintain a credible defensive capability. The proposed sale will help improve the security of the recipient and assist in maintaining political stability, military balance, and economic progress in the region.
The proposed sale will improve the recipient's ability to meet current and future threats. The recipient will have no difficulty absorbing this equipment into its armed forces.
The proposed sale of this equipment and support will not alter the basic military balance in the region.
The principal contractor will be AeroVironment, Inc., located in Simi Valley, CA. There are no known offset agreements proposed in connection with this potential sale.
Implementation of this proposed sale will require the assignment of eight U.S. Government and two contractor representatives for a duration of up to five years to support equipment fielding, training, and program management.
There will be no adverse impact on U.S. defense readiness because of this proposed sale.
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1. The Switchblade 300 (SB300) is a loitering, self-contained, tube-launched, lightweight, man-portable, day/night, direct-fire precision guided-missile system. It is capable of line-of-sight and beyond line-of-sight engagements, enabled by a live video feed from the missile to the fire control system (FCS). This capability provides small tactical units with organic, responsive precision fires. An operator can fly to the target area, loiter, wave off, or engage a target. A small, forward-firing fragmentation warhead defeats stationary or moving personnel and light vehicles while reducing potential collateral damage.
2. The highest level of classification of defense articles, components, and services included in this potential sale is Controlled Unclassified Information.
3. If a technologically advanced adversary were to obtain knowledge of the specific hardware and software elements, the information could be used to develop countermeasures that might reduce weapon system effectiveness or be used in the development of a system with similar or advanced capabilities.
4. A determination has been made that the recipient can provide substantially the same degree of protection for the sensitive technology being released as the U.S. Government. This sale is necessary in furtherance of the U.S. foreign policy and national security objectives outlined in the Policy Justification.
5. All defense articles and services listed in this transmittal have been authorized for release and export to the recipient.
Defense Security Cooperation Agency, Department of Defense (DoD).
Arms sales notice.
The DoD is publishing the unclassified text of an arms sales notification.
Urooj Zahra at (703) 695-6523,
This 36(b)(1) arms sales notification is published to fulfill the requirements of section 155 of Public Law 104-164 dated July 21, 1996. The following is a copy of a letter to the Speaker of the House of Representatives with attached Transmittal 24-41, Policy Justification, and Sensitivity of Technology.
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* as defined in Section 47(6) of the Arms Export Control Act.
Taipei Economic and Cultural Representative Office in the United States—F-16 Non-Standard Spare and Repair Parts
The Taipei Economic and Cultural Representative Office in the United States (TECRO) has requested to buy non-standard spare and repair parts, components, consumables, and accessories for F-16 aircraft; U.S. Government and contractor engineering, technical, and logistics support services; and other related elements of logistics
This proposed sale is consistent with U.S. law and policy as expressed in Public Law 96-8.
This proposed sale serves U.S. national, economic, and security interests by supporting the recipient's continuing efforts to modernize its armed forces and to maintain a credible defensive capability. The proposed sale will help improve the security of the recipient and assist in maintaining political stability, military balance, and economic progress in the region.
The proposed sale will improve the recipient's ability to meet current and future threats by maintaining the operational readiness of the recipient's fleet of F-16 aircraft. The recipient will have no difficulty absorbing this equipment into its armed forces.
The proposed sale of this equipment and support will not alter the basic military balance in the region.
This equipment will be transferred from U.S. Air Force stock. There are no known offset agreements proposed in connection with this potential sale.
Implementation of this proposed sale will not require the assignment of any additional U.S. Government or contractor representatives to the recipient.
There will be no adverse impact on U.S. defense readiness as a result of this proposed sale.
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. Each filing may be viewed on the Commission's website at
Take notice that the Commission has received the following Natural Gas Pipeline Rate and Refund Report filings:
Any person desiring to intervene, to protest, or to answer a complaint in any of the above proceedings must file in accordance with Rules 211, 214, or 206 of the Commission's Regulations (18 CFR 385.211, 385.214, or 385.206) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
Any person desiring to protest in any the above proceedings must file in accordance with Rule 211 of the Commission's Regulations (18 CFR 385.211) on or before 5:00 p.m. Eastern time on the specified comment date.
The filings are accessible in the Commission's eLibrary system (
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502-6595 or
On June 24, 2025, Nightfall Renewables Inc. filed an application for a preliminary permit, pursuant to section 4(f) of the Federal Power Act (FPA), proposing to study the feasibility of the Juniper Pumped Storage Project to be located in Los Angeles County, California. The sole purpose of a preliminary permit, if issued, is to grant the permit holder priority to file a license application during the permit term. A preliminary permit does not authorize the permit holder to perform any land-disturbing activities or otherwise enter upon lands or waters owned by others without the owners' express permission.
The proposed project would consist of the following new facilities: (1) a 320-foot-high, 2,330-foot-long concrete upper reservoir dam that would impound an 110-acre upper reservoir with a storage capacity of 11,000 acre-feet at a water surface elevation of 3,840 feet above mean sea level; (2) a 300-foot-wide, 5-foot-high, and 750-foot-long spillway on the upper dam; (3) ten 70-foot-high, 50-foot-wide, and 120-foot to 200-foot-long lower reservoirs that would be 5,000 feet underground with a total volume for each reservoir of 1,000 acre-feet; (4) fifty-six 18-foot-wide, 16-foot-high, and 10-foot-long concrete bulkheads within the lower reservoirs; (5) a 4,800-foot-long, 26-foot-diameter steel and concrete lined vertical headrace shaft connected to ten 10-foot-wide, 580 foot-long headrace penstock pipes; (6) ten 157-foot-long, 65-foot-wide, 92-foot-high underground turbine powerhouses with one Pelton turbine and generator each; (7) ten 157-foot-long, 65-foot-wide, 125-foot-high pump powerhouses with two radial storage pumps and motors; (8) ten 18-foot-wide, 16-foot-high, 170-foot-long tailraces; (9) fifteen 18-foot-wide, 16-foot-high access tunnels; (10) one 18-inch-diameter, 6-mile-long steel water supply pipeline; (11) 5 miles of access roads; (12) a rock stockpile site; (13) two 3-mile-long, 230-kilovolt transmission lines; (14) one 3-mile-long 500-kilovolt transmission line; and (15) appurtenant facilities. The proposed project would have an estimated annual generation of 14,600,000 megawatt hours.
Deadline for filing comments, motions to intervene, competing applications (without notices of intent), or notices of intent to file competing applications: on or before 5:00 p.m. Eastern Time on November 24, 2025. Competing applications and notices of intent must meet the requirements of 18 CFR 4.36.
The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502-6595 or
The Commission strongly encourages electronic filing. Please file comments, motions to intervene, notices of intent, and competing applications using the Commission's eFiling system at
More information about this project, including a copy of the application, can be viewed or printed on the “eLibrary” link of Commission's website at
Take notice that on September 12, 2025, Gulf South Pipeline Company, LLC (Gulf South) and Texas Gas Transmission, LLC (Texas Gas) (collectively, the Applicants), 9 Greenway Plaza, Suite 2800, Houston, Texas 77046, filed an application under sections 7(b) and 7(c) of the Natural Gas Act (NGA) and Part 157 of the Commission's regulations requesting authorization for the Kosciusko Junction Pipeline Project (Project). Gulf South proposes to: (1) construct the 103-mile-long, 36-inch-diameter Kosciusko Junction Pipeline; (2) construct the 8-mile-long, 36-inch-diameter Columbia Gulf Lateral; (3) install a total of 22,932 horsepower (hp) at the Isola Compressor Station (CS); (4) construct the new 51,554 hp Kosciusko CS; (5) construct the new 20,952 hp Holmes CS; (6) construct four meter and regulating stations; and (7) construct various appurtenances, all located in Attala, Clarke, Holmes, Humphreys, Jasper, Leake, Newton, and Sunflower Counties, Mississippi. Additionally, Gulf South requests authorization to: (1) acquire Texas Gas' existing Greenville Lateral and Isola CS in Washington County, Mississippi; (2) acquire 420,000 dekatherms per day (Dth/d) of capacity via lease on the Texas Gas mainline system; and (3) abandon via lease 595,000 Dth/d to Texas Gas. The Project will create approximately 1.175 billion cubic feet per day (Bcf/d) of new pipeline capacity, of which 1.1 Bcf/d is subscribed to Southern Company Services, Inc., Florida Power & Light Company, and PowerSouth Energy Cooperative. Gulf South estimates the total cost of the Project to be $1,031,400,000 and proposes recourse rate with service provided under Rate Schedule FTS.
In addition, Texas Gas proposes to: (1) abandon by sale to Gulf South its Greenville Lateral, Isola CS, and appurtenances in Washington and Humphreys Counties, Mississippi; (2) install one 20,952 horsepower gas-fired, turbine-driven compressor unit at its Greenville CS in Washington County, Mississippi; (3) abandon via lease 420,000 dekatherms per day (Dth/d) of mainline capacity to Gulf South; and (4) acquire via lease 595,000 Dth/d of capacity from Gulf South on the Greenville Lateral. The Project will allow Texas Gas to transport up to 595,000 Dth/d to the remaining shippers on the Greenville Lateral. Texas Gas estimates the total cost of the Project to be $79.5 million, all as more fully set forth in the application which is on file with the Commission and open for public inspection.
In addition to publishing the full text of this document in the
User assistance is available for eLibrary and the Commission's website during normal business hours from FERC Online Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at
Any questions regarding Gulf South's proposed project in Docket No. CP25-547-000 should be directed to Juan Eligio Jr., Director, Regulatory Affairs, Gulf South Pipeline Company, LLC, 9 Greenway Plaza, Suite 2800, Houston, Texas 77046, by phone at (713) 479-3480 or by email at
Any questions regarding Texas Gas' proposed project in Docket No. CP25-549-000 should be directed to J. Kyle Stephens, Vice President Regulatory Affairs, Texas Gas Transmission, LLC, 9 Greenway Plaza, Suite 2800, Houston, Texas 77046, by phone at (713) 479-8033, or by email at
On February 7, 2025, the Commission granted the Applicants' request to utilize the National Environmental Policy Act Pre-Filing Process and assigned Docket No. PF25-6-000 to staff activities involved in the Project. Now, as of the filing of the September 12, 2025 application, the Pre-Filing Process for this project has ended. From this time forward, this proceeding will be conducted in Docket Nos. CP25-547-000 and CP25-549-000 as noted in the caption of this Notice.
Pursuant to section 157.9 of the Commission's Rules of Practice and Procedure,
The Applicants stated that a water quality certificate under section 401 of the Clean Water Act is required for the project from Mississippi Department of Environmental Quality. When available, the Applicants should submit to the Commission a copy of the request for certification for the Commission authorization, including the date the request was submitted to the certifying agency, and either (1) a copy of the certifying agency's decision or (2) evidence of waiver of water quality certification.
There are three ways to become involved in the Commission's review of this project: you can file comments on the project, you can protest the filing, and you can file a motion to intervene
The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502-6595 or
Any person wishing to comment on the project may do so. Comments may include statements of support or objections, to the project as a whole or specific aspects of the project. The more specific your comments, the more useful they will be.
Pursuant to sections 157.10(a)(4)
To ensure that your comments or protests are timely and properly recorded, please submit your comments on or before 5:00 p.m. Eastern Time on October 16, 2025.
There are three methods you can use to submit your comments or protests to the Commission. In all instances, please reference the Project docket number CP25-547-000 and/or CP25-549-00 in your submission.
(1) You may file your comments electronically by using the eComment feature, which is located on the Commission's website at
(2) You may file your comments or protests electronically by using the eFiling feature, which is located on the Commission's website (
(3) You can file a paper copy of your comments or protests by mailing them to the following address below. Your written comments must reference the Project docket numbers (CP25-547-000 and/or CP25-549-000).
The Commission encourages electronic filing of comments (options 1 and 2 above) and has eFiling staff available to assist you at (202) 502-8258 or
Persons who comment on the environmental review of this project will be placed on the Commission's environmental mailing list and will receive notification when the environmental documents (EA or EIS) are issued for this project and will be notified of meetings associated with the Commission's environmental review process.
The Commission considers all comments received about the project in determining the appropriate action to be taken. However, the filing of a comment alone will not serve to make the filer a party to the proceeding. To become a party, you must intervene in the proceeding. For instructions on how to intervene, see below.
Any person, which includes individuals, organizations, businesses, municipalities, and other entities,
To intervene, you must submit a motion to intervene to the Commission in accordance with Rule 214 of the Commission's Rules of Practice and Procedure
There are two ways to submit your motion to intervene. In both instances, please reference the Project docket numbers CP25-547-000 and/or CP25-549-000 in your submission.
(1) You may file your motion to intervene by using the Commission's eFiling feature, which is located on the Commission's website (
(2) You can file a paper copy of your motion to intervene, along with three copies, by mailing the documents to the address below. Your motion to intervene must reference the Project docket numbers CP25-547-000 and/or CP25-549-000.
The Commission encourages electronic filing of motions to intervene (option 1 above) and has eFiling staff available to assist you at (202) 502-8258 or
Protests and motions to intervene must be served on the applicant for Docket No. CP25-547-000 either by mail at: Juan Eligio Jr., Director, Regulatory Affairs, Gulf South Pipeline
Protests and motions to intervene must be served on the applicant for Docket No. CP25-549-000 either by mail at: J. Kyle Stephens, Vice President, Regulatory Affairs, Texas Gas Transmission, LLC, Suite 2800, Houston, Texas 77046, or by email (with a link to the document) at
Any subsequent submissions by an intervenor must be served on the applicant and all other parties to the proceeding. Contact information for parties can be downloaded from the service list at the eService link on FERC Online. Service can be via email with a link to the document.
All timely, unopposed
Throughout the proceeding, additional information about the project will be available from the Commission's Office of External Affairs, at (866) 208-FERC, or on the FERC website at
In addition, the Commission offers a free service called eSubscription which allows you to keep track of all formal issuances and submittals in specific dockets. This can reduce the amount of time you spend researching proceedings by automatically providing you with notification of these filings, document summaries, and direct links to the documents. For more information and to register, go to
Take notice that the commission received the following accounting Request filings:
Take notice that the Commission received the following electric rate filings:
The filings are accessible in the Commission's eLibrary system (
Any person desiring to intervene, to protest, or to answer a complaint in any of the above proceedings must file in accordance with Rules 211, 214, or 206 of the Commission's Regulations (18 CFR 385.211, 385.214, or 385.206) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502-6595 or
Take notice that the following hydroelectric application has been filed with the Commission and is available for public inspection.
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The Commission strongly encourages electronic filing. Please file comments, recommendations, terms and conditions, and prescriptions using the Commission's eFiling system at
The Commission's Rules of Practice require all intervenors filing documents with the Commission to serve a copy of that document on each person on the official service list for the project. Further, if an intervenor files comments or documents with the Commission relating to the merits of an issue that may affect the responsibilities of a particular resource agency, they must also serve a copy of the document on that resource agency.
k. This application has been accepted and is ready for environmental analysis at this time.
l.
Pike Island Corporation proposes to operate the proposed Pike Island Project in a run-of-release mode, meaning it would generate using flows made available by the Corps. More specifically, project outflow would equal project inflow made available for generation via normal water flow of the Ohio River, according to the Corps' existing water level and discharge management practices. The proposed project would only use flows made available for release according to daily operation guidelines and directives issued by the Corps as part of its project river management. The Corps would continue to regulate water elevation and discharge according to its current operation guidelines.
m. A copy of the application is available for review via the internet through the Commission's Home Page (
All filings must (1) bear in all capital letters the title “COMMENTS,” “REPLY COMMENTS,” “RECOMMENDATIONS,” “TERMS AND CONDITIONS,” or “PRESCRIPTIONS;” (2) set forth in the heading the name of the applicant and the project number of the application to which the filing responds; (3) furnish the name, address, and telephone number of the person submitting the filing; and (4) otherwise comply with the requirements of 18 CFR 385.2001 through 385.2005. All comments, recommendations, terms and conditions or prescriptions must set forth their evidentiary basis and otherwise comply with the requirements of 18 CFR 4.34(b). Agencies may obtain copies of the application directly from the applicant. Each filing must be accompanied by proof of service on all persons listed on the service list prepared by the Commission in this proceeding, in accordance with 18 CFR 4.34(b) and 385.2010.
The Commission's Office of Public Participation (OPP) supports meaningful
You may also register online at
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o. Final amendments to the application must be filed with the Commission on or before 5:00 p.m. Eastern Time on October 27, 2025.
On September 16, 2025, the New York State Department of Environmental Conservation (New York DEC) submitted to the Federal Energy Regulatory Commission (Commission) notice that it received a request for a Clean Water Act Section 401(a)(1) water quality certification as defined in 40 CFR 121.5, from Consolidated Hydro New York, LLC, in conjunction with the above captioned project, on September 12, 2025. Pursuant to the Commission's regulations,
If the New York DEC fails or refuses to act on the water quality certification request on or before the above date, then the certifying authority is deemed waived pursuant to section 401(a)(1) of the Clean Water Act, 33 U.S.C. 1341(a)(1).
Take notice that the following hydroelectric application has been filed with the Commission and is available for public inspection.
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j. Deadline for Filing Scoping Comments: on or before 5:00 p.m. Eastern Time on October 20, 2025.
The Commission strongly encourages electronic filing. Please file scoping comments using the Commission's eFiling system at
The Commission's Rules of Practice require all intervenors filing documents with the Commission to serve a copy of that document on each person on the official service list for the project. Further, if an intervenor files comments or documents with the Commission relating to the merits of an issue that may affect the responsibilities of a particular resource agency, they must also serve a copy of the document on that resource agency.
k. This application has been accepted for filing but is not ready for environmental analysis at this time.
l. The proposed RC Byrd Project would be constructed at the two parallel decommissioned lock chambers on the West Virginia side of RC Byrd Locks and Dam and would consist of the following new facilities: (1) two 110-foot-wide, 850-foot-long intake channels with trash racks (with a clear spacing of 5 inches); (2) two 110-foot-wide, 142.5-foot-long, and 67-foot-high concrete powerhouses within the decommissioned lock chambers; (3) three horizontal pit Kaplan turbine-generator units in each powerhouse with a total installed capacity of 28.5 megawatts (MW) for both powerhouses; (4) two 110-foot-wide, 955-foot-long tailrace channels; (5) a 250-foot-long, 12.47-kilovolt (kV) underground generator lead from each powerhouse to a new 110-foot-long and 110-foot-wide substation containing a 12.47-kV/69-kV step-up transformer; (6) a 2.5-mile-long, 69-kV overhead transmission line connecting the project to the point of interconnection at the existing Apple Grove substation; (7) a proposed 170-foot-long access road between the existing Corps facility
The proposed RC Byrd Project would operate in a run-of-release mode, whereby outflow from the project would approximate inflow made available for generation by the Corps. The RC Byrd Project is projected to have an annual energy generation of about 165,169 megawatt-hours.
m. A copy of the application is available for review on the Commission's website at
You may also register online at
n. The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502-6595 or
o.
Copies of the SD outlining the subject areas to be addressed in the NEPA document were distributed to the parties on the Commission's mailing list and the applicant's distribution list. Copies of the SD may be viewed on the web at
p.
Take notice that on September 12, 2025, Transcontinental Gas Pipe Line Company, LLC (Transco), Post Office Box 1396, Houston, Texas 77251-1396, filed an application under section 7(b) of the Natural Gas Act (NGA) and Part 157 of the Commission's regulations requesting authorization for its Offshore Abandonment Project (Project). The Project consists of abandoning approximately 26 miles of 12- and 24-inch-diameter offshore gathering lateral in the Galveston Area Block 239 and the High Island Area Blocks 154, 179, and 206, located in Federal Waters, Offshore Texas. Transco states that the Project will eliminate costs and risks associated with retention of the Facilities. Transco estimates the total cost of the Project to be $4.7 million, all as more fully set forth in the application which is on file with the Commission and open for public inspection.
In addition to publishing the full text of this document in the
User assistance is available for eLibrary and the Commission's website during normal business hours from FERC Online Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at
Any questions regarding the proposed project should be directed to Travis Beach, Regulatory Analyst, Lead, Post Office Box 1396, Houston, Texas 77251, by phone at (346) 439-0447, or by email at
Pursuant to section 157.9 of the Commission's Rules of Practice and Procedure,
There are three ways to become involved in the Commission's review of this project: you can file comments on the project, you can protest the filing, and you can file a motion to intervene in the proceeding. There is no fee or cost for filing comments or intervening. The deadline for filing a motion to intervene is 5:00 p.m. Eastern Time on October 16, 2025. How to file protests, motions to intervene, and comments is explained below.
The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members and others, access publicly available information and navigate Commission processes. For
Any person wishing to comment on the project may do so. Comments may include statements of support or objections, to the project as a whole or specific aspects of the project. The more specific your comments, the more useful they will be.
Pursuant to sections 157.10(a)(4)
To ensure that your comments or protests are timely and properly recorded, please submit your comments on or before 5:00 p.m. Eastern Time on October 16, 2025.
There are three methods you can use to submit your comments or protests to the Commission. In all instances, please reference the Project docket number CP25-546-000 in your submission.
(1) You may file your comments electronically by using the eComment feature, which is located on the Commission's website at
(2) You may file your comments or protests electronically by using the eFiling feature, which is located on the Commission's website (
(3) You can file a paper copy of your comments or protests by mailing them to the following address below. Your written comments must reference the Project docket number (CP25-546-000).
The Commission encourages electronic filing of comments (options 1 and 2 above) and has eFiling staff available to assist you at (202) 502-8258 or
Persons who comment on the environmental review of this project will be placed on the Commission's environmental mailing list, and will receive notification when the environmental documents (EA or EIS) are issued for this project and will be notified of meetings associated with the Commission's environmental review process.
The Commission considers all comments received about the project in determining the appropriate action to be taken. However, the filing of a comment alone will not serve to make the filer a party to the proceeding. To become a party, you must intervene in the proceeding. For instructions on how to intervene, see below.
Any person, which includes individuals, organizations, businesses, municipalities, and other entities,
To intervene, you must submit a motion to intervene to the Commission in accordance with Rule 214 of the Commission's Rules of Practice and Procedure
There are two ways to submit your motion to intervene. In both instances, please reference the Project docket number CP25-546-000 in your submission.
(1) You may file your motion to intervene by using the Commission's eFiling feature, which is located on the Commission's website (
(2) You can file a paper copy of your motion to intervene, along with three copies, by mailing the documents to the address below. Your motion to intervene must reference the Project docket number CP25-546-000.
The Commission encourages electronic filing of motions to intervene (option 1 above) and has eFiling staff available to assist you at (202) 502-8258 or
Protests and motions to intervene must be served on the applicant either by mail at: Travis Beach, Regulatory Analyst, P.O. Box 1396, Houston, Texas 77251, or by email (with a link to the document) at
All timely, unopposed
Throughout the proceeding, additional information about the project will be available from the Commission's Office of External Affairs, at (866) 208-FERC, or on the FERC website at
In addition, the Commission offers a free service called eSubscription which allows you to keep track of all formal issuances and submittals in specific dockets. This can reduce the amount of time you spend researching proceedings by automatically providing you with notification of these filings, document summaries, and direct links to the documents. For more information and to register, go to
Take notice that the following hydroelectric application has been filed with the Commission and is available for public inspection.
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
The Commission strongly encourages electronic filing. Please file comments, recommendations, terms and conditions, and prescriptions using the Commission's eFiling system at
The Commission's Rules of Practice require all intervenors filing documents with the Commission to serve a copy of that document on each person on the official service list for the project. Further, if an intervenor files comments or documents with the Commission relating to the merits of an issue that may affect the responsibilities of a particular resource agency, they must also serve a copy of the document on that resource agency.
k. This application has been accepted and is ready for environmental analysis at this time.
l.
Current Hydro proposes to operate the New Cumberland Project in a run-of-release mode, meaning it would generate using flows made available by the Corps. More specifically, the project outflow would equal project inflow made available for generation via normal water flow of the Ohio River, according to the Corps' existing water level and discharge management practices. The proposed project would only use flows made available for
m. A copy of the application is available for review via the internet through the Commission's Home Page (
All filings must (1) bear in all capital letters the title “COMMENTS,” “REPLY COMMENTS,” “RECOMMENDATIONS,” “TERMS AND CONDITIONS,” or “PRESCRIPTIONS”; (2) set forth in the heading the name of the applicant and the project number of the application to which the filing responds; (3) furnish the name, address, and telephone number of the person submitting the filing; and (4) otherwise comply with the requirements of 18 CFR 385.2001 through 385.2005. All comments, recommendations, terms and conditions or prescriptions must set forth their evidentiary basis and otherwise comply with the requirements of 18 CFR 4.34(b). Agencies may obtain copies of the application directly from the applicant. Each filing must be accompanied by proof of service on all persons listed on the service list prepared by the Commission in this proceeding, in accordance with 18 CFR 4.34(b) and 385.2010.
The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members, and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502-6595 or
You may also register online at
n.
o. Final amendments to the application must be filed with the Commission on or before 5:00 p.m. Eastern Time on October 27, 2025.
Take notice that on September 22, 2025, Texas Eastern Transmission, LP (Texas Eastern) requested that the Commission grant an extension of time, until June 30, 2027, to construct and place into service its Appalachia to Market II & Armagh & Entriken HP Replacement Projects (Project) located in Lebanon, Indiana, and Huntingdon Counties, Pennsylvania as authorized in the Order Issuing Certificate and Approving Abandonment (2023 Order)
Texas Eastern has completed construction and placed into service the Project facilities at its Armagh Compressor Station in Indiana County, Pennsylvania on September 6, 2025 and the Line 28 Loop in Lebanon County, Pennsylvania on September 18, 2025. The only remaining construction involves the facilities at the Entriken Compressor Station in Huntingdon County, Pennsylvania. While construction activities at the Entriken Compressor Station commenced in August 2025, the change in compressor unit type from electric to gas, as approved in the 2025 Order, resulted in the need for additional time to complete construction of the compressor station.
This notice establishes a 15-calendar day intervention and comment period deadline. Any person wishing to comment on Texas Eastern's request for an extension of time may do so. No reply comments or answers will be considered. If you wish to obtain legal status by becoming a party to the proceedings for this request, you should, on or before the comment date stated below, file a motion to intervene in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the Natural Gas Act (NGA) (18 CFR 157.10).
As a matter of practice, the Commission itself generally acts on requests for extensions of time to complete construction for NGA facilities when such requests are contested before order issuance. For those extension requests that are contested,
In addition to publishing the full text of this document in the
User assistance is available for eLibrary and the Commission's website during normal business hours from FERC Online Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at
The Commission strongly encourages electronic filings of comments in lieu of paper using the “eFile” link at
The Commission's Office of Public Participation (OPP) supports meaningful public engagement and participation in Commission proceedings. OPP can help members of the public, including landowners, community organizations, Tribal members and others, access publicly available information and navigate Commission processes. For public inquiries and assistance with making filings such as interventions, comments, or requests for rehearing, the public is encouraged to contact OPP at (202) 502-6595 or
Federal Accounting Standards Advisory Board.
Notice.
Notice is hereby given that the Federal Accounting Standards Advisory Board staff has issued Technical Bulletin (TB) 2025-1 titled
TB 2025-1 is available on the FASAB website at
Ms. Monica R. Valentine, Executive Director, 441 G Street NW, Suite 1155, Washington, DC 20548, or call (202) 512-7350.
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act (PRA) of 1995, the Federal Communications Commission (FCC or the Commission) invites the general public and other Federal agencies to take this opportunity to comment on the following information collection. Comments are requested concerning: whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information collection burden on small business concerns with fewer than 25 employees. The FCC may not conduct or sponsor a collection of information unless it displays a currently valid control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the PRA that does not display a valid Office of Management and Budget (OMB) control number.
Written PRA comments should be submitted on or before December 1, 2025. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this notice, you should advise the contact listed below as soon as possible.
Direct all PRA comments to Nicole Ongele, FCC, via email
For additional information about the information collection, contact Nicole Ongele, (202) 418-2991.
Federal Communications Commission.
The Federal Communications Commission will hold an Open Meeting on the subjects listed below on Tuesday, September 30, 2025, which is scheduled to commence at 10:30 a.m. in the Commission Meeting Room of the Federal Communications Commission, 45 L Street NE, Washington, DC.
While attendance at the Open Meeting is available to the public, the FCC headquarters building is not open access and all guests must check in with and be screened by FCC security at the main entrance on L Street. Attendees at the Open Meeting will not be required to have an appointment but must otherwise comply with protocols outlined at:
The meeting will be webcast at:
Press Access—Members of the news media are welcome to attend the meeting and will be provided reserved seating on a first-come, first-served basis. Following the meeting, the
Additional information concerning this meeting may be obtained from the Office of Media Relations, (202) 418-0500. Audio/Video coverage of the meeting will be broadcast live with open captioning over the internet from the FCC Live web page at
The notificants listed below have applied under the Change in Bank Control Act (Act) (12 U.S.C. 1817(j)) and § 225.41 of the Board's Regulation Y (12 CFR 225.41) to acquire shares of a bank or bank holding company. The factors that are considered in acting on the applications are set forth in paragraph 7 of the Act (12 U.S.C. 1817(j)(7)).
The public portions of the applications listed below, as well as other related filings required by the Board, if any, are available for immediate inspection at the Federal Reserve Bank(s) indicated below and at the offices of the Board of Governors. This information may also be obtained on an expedited basis, upon request, by contacting the appropriate Federal Reserve Bank and from the Board's Freedom of Information Office at
Comments received are subject to public disclosure. In general, comments received will be made available without change and will not be modified to remove personal or business information including confidential, contact, or other identifying information. Comments should not include any information such as confidential information that would not be appropriate for public disclosure.
Comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors, Ann E. Misback, Secretary of the Board, 20th Street and Constitution Avenue NW, Washington, DC 20551-0001, not later than October 15, 2025.
A. Federal Reserve Bank of St. Louis (Holly A. Rieser, Senior Manager) P.O. Box 442, St. Louis, Missouri 63166-2034. Comments can also be sent electronically to
1.
Board of Governors of the Federal Reserve System.
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
Notice with comment period.
The Centers for Disease Control and Prevention (CDC), as part of its continuing effort to reduce public burden and maximize the utility of government information, invites the general public and other federal agencies the opportunity to comment on a continuing information collection, as required by the Paperwork Reduction Act of 1995. This notice invites comment on a proposed information collection project titled State Unintentional Drug Overdose Reporting System (SUDORS). SUDORS is designed to detect new trends in fatal unintentional drug overdoses, support targeting drug overdose prevention efforts, and assess the progress of the HHS initiative to reduce opioid misuse and overdoses.
CDC must receive written comments on or before December 1, 2025.
You may submit comments, identified by Docket No. CDC-2025-0552 by either of the following methods:
•
•
To request more information on the proposed project or to obtain a copy of the information collection plan and instruments, contact Jeffrey M. Zirger, Information Collection Review Office, Centers for Disease Control and Prevention, 1600 Clifton Road, NE, MS H21-8, Atlanta, Georgia 30329; Telephone: 404-639-7570; Email:
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. In addition, the PRA also requires federal agencies to provide a 60-day notice in the
The OMB is particularly interested in comments that will help:
1. Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
2. Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
3. Enhance the quality, utility, and clarity of the information to be collected;
4. Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
5. Assess information collection costs.
State Unintentional Drug Overdose Reporting System (SUDORS) (OMB Control No. 0920-1128, Exp. 2/26/2026)—Revision—National Center for Injury Prevention and Control (NCIPC), Centers for Disease Control and Prevention (CDC).
There has been a rapid increase in opioid overdose deaths since 2013. In the United States, more people are now dying of drug overdose than automobile crashes, although opioids—both opioid pain relievers (OPRs) and illicit forms such as heroin—are also a major factor in overdose-related automobile crashes. On October 26, 2017, the U.S. Department of Health and Human Services (HHS) declared the opioid overdose epidemic to be a national public health emergency.
CDC established the State Unintentional Drug Overdose Reporting System (SUDORS) to detect new trends in fatal unintentional drug overdoses, support targeting drug overdose prevention efforts, and assess the progress of the HHS initiative to reduce opioid misuse and overdoses. Respondents are state- or jurisdiction-level health departments. The SUDORS surveillance system generates detailed, timely public health information on unintentional, fatal opioid-related drug overdoses and has been used to inform prevention and response efforts at the national, state, and local levels. SUDORS consolidates and supplements information available to health departments, including vital statistics and records created by medical examiners and coroners (ME/C). SUDORS is built on a web-based software platform and a collaborative surveillance and data integration model developed by CDC and health departments to improve understanding of homicide, suicide, undetermined deaths, and unintentional firearm deaths (National Violent Death Reporting System (NVDRS), OMB No. 0920-0607.
Through SUDORS, CDC currently collects information that is not provided on death certificates, such as whether the drug(s) causing the overdoses were injected or taken orally; a toxicology report on the decedent, if available; and risk factors for fatal drug overdoses including previous drug overdoses, decedent's mental health, and whether the decedent recently exited a treatment program. Without this information, efforts to prevent drug overdose deaths are often based on limited information available on the death certificate and anecdotal evidence.
This is a Revision request for the currently approved State Unintentional Drug Overdose Reporting System (SUDORS) (OMB Control No. 0920-1128, Exp. 2/28/2026. With this Revision, CDC is requesting OMB approval for an additional three years to continue data collection efforts. This Revision request does not entail a change in the estimated burden per response, which is based on the time needed for a health department to retrieve and refile vital statistics records, ME/C records, etc. The estimated burden per response does not include the time needed to abstract SUDORS data variables from those sources, since this activity is funded by the SUDORS cooperative agreement. CDC requests OMB approval for an estimated 43,631 annualized burden hours. There is no cost to respondents other than their time to participate.
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
Notice with comment period.
The Centers for Disease Control and Prevention (CDC), as part of its continuing effort to reduce public burden and maximize the utility of government information, invites the general public and other federal agencies the opportunity to comment on a continuing information collection, as required by the Paperwork Reduction Act of 1995. This notice invites comment on an existing information collection project titled Evaluation Reporting Template for National and State Tobacco Control Program. This data collection project supports the evaluation of the National and State Tobacco Control Program and allows
CDC must receive written comments on or before December 1, 2025.
You may submit comments, identified by Docket No. CDC-2025-0486 by either of the following methods:
•
•
To request more information on the project or to obtain a copy of the information collection plan and instruments, contact Jeffrey M. Zirger, Information Collection Review Office, Centers for Disease Control and Prevention, 1600 Clifton Road NE, MS H21-8, Atlanta, Georgia 30329; Telephone: 404-639-7570; Email:
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. In addition, the PRA also requires federal agencies to provide a 60-day notice in the
The OMB is particularly interested in comments that will help:
1. Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
2. Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
3. Enhance the quality, utility, and clarity of the information to be collected;
4. Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
5. Assess information collection costs.
Evaluation Reporting Template for National and State Tobacco Control Program (OMB Control No. 0920-1390, Exp. 3/31/2026)—Extension—National Center for Chronic Disease Prevention and Health Promotion (NCCDPHP), Centers for Disease Control and Prevention (CDC).
The CDC's Office on Smoking and Health (OSH) created the National and State Tobacco Control Program (NTCP) in 1999 to encourage coordinated, national efforts to reduce tobacco-related diseases and deaths. The NTCP provides funding and technical support to state and territorial health departments. NTCP funds 50 states, Washington, DC, Puerto Rico, and Guam. NTCP-funded programs are working to eliminate exposure to secondhand smoke, promote quitting among adults and youth, prevent initiation among youth and young adults, and identify and eliminate tobacco-related disparities. To reach these goals, the programs implement State and Community Interventions, Mass-Reach Health Communication Interventions, Tobacco Use and Dependence Treatment Interventions, and conduct Surveillance and evaluation.
This information collection project supports the NTCP state and territorial tobacco program managers, administrators, and evaluators by specifying which information should be included in their annual evaluation reports. Furthermore, the information collected via this form will allow CDC to monitor and evaluate program performance; document facilitators and barriers, lessons learned, and promising practices; establish processes to support continuous program improvement and development; and assess the effectiveness and outcomes of the NTCP. This information collection request (ICR) utilizes a form titled Evaluation Reporting Template for National and State Tobacco Control Program (ERT). The collection of this information is part of a federal reporting requirement for funds received by NTCP recipients and consolidates information necessary for evaluation of the NTCP. The data collected through the ERT was compared to all other potential evaluation data sources and designed not to duplicate any information collected in other tools. Although other NTCP data collection tools are in use to collect data for NTCP, these existing data collection tools are focused on financial and programmatic management, program implementation, and performance measurement. By contrast, the ERT will collect process and outcome evaluation findings resulting from individual evaluations designed by each NTCP recipient; findings will include contextual factors, indicators, lessons learned, and information about health equities and health disparities. Recipients will use the ERT to report information to CDC about their Tobacco Control Program evaluation findings. Each recipient will submit an annual ERT using the Microsoft Word-based Evaluation Reporting Tool.
Current respondents are 53 cooperative agreement recipients. The estimated burden per response is eight hours for each ERT. CDC requests OMB approval for a period of three years with an estimated 424 annual burden hours. There is no cost to respondents other than their time.
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
Notice with comment period.
The Centers for Disease Control and Prevention (CDC), as part of its continuing effort to reduce public burden and maximize the utility of government information, invites the general public and other federal agencies the opportunity to comment on a continuing information collection, as required by the Paperwork Reduction Act of 1995. This notice invites comment on a proposed information collection project titled National HIV Surveillance System (NHSS). The NHSS collects comprehensive population-based data on persons living with HIV in the U.S. and its territories, utilizing standard reporting from laboratories and healthcare providers to monitor trends, estimate incidence and prevalence, analyze drug resistance, detect and monitor clusters, and inform public health planning and resource allocation at federal, state and local levels and by HIV prevention and care partners.
CDC must receive written comments on or before December 1, 2025.
You may submit comments, identified by Docket No. CDC-2025-0519 by either of the following methods:
•
•
To request more information on the proposed project or to obtain a copy of the information collection plan and instruments, contact Jeffrey M. Zirger, Information Collection Review Office, Centers for Disease Control and Prevention, 1600 Clifton Road NE, MS H21-8, Atlanta, Georgia 30329; Telephone: 404-639-7570; Email:
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. In addition, the PRA also requires federal agencies to provide a 60-day notice in the
The OMB is particularly interested in comments that will help:
1. Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
2. Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
3. Enhance the quality, utility, and clarity of the information to be collected;
4. Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
5. Assess information collection costs.
National HIV Surveillance System (NHSS) (OMB Control No. 0920-0573, Exp. 2/28/2026)—Extension—National Center for HIV, Viral Hepatitis, STD, and TB Prevention (NCHHSTP), Centers for Disease Control and Prevention (CDC).
CDC is authorized under Sections 304 and 306 of the Public Health Service Act (42 U.S.C. 242b and 242k) to collect information on cases of human immunodeficiency virus (HIV) and indicators of HIV disease and HIV disease progression including AIDS. Data collected as part of the National HIV Surveillance System (NHSS) are the primary data used to monitor the extent and characteristics of the HIV burden in the United States. HIV surveillance data are used to describe trends in HIV incidence, prevalence and characteristics of persons diagnosed with HIV infection and used widely at the federal, state, and local levels for planning and evaluating prevention programs and health-care services, allocating funding for prevention and care, and monitoring progress toward achieving national prevention goals. NHSS data collection activities are currently supported through cooperative agreements with health departments
The Division of HIV Prevention (DHP), National Center for HIV, Viral Hepatitis, STD, and TB Prevention (NCHHSTP), CDC in collaboration with health departments in the states, the District of Columbia, and U.S. territories and freely associated states, conducts national surveillance for cases of HIV infection that includes critical data reported across the spectrum of HIV disease stages from HIV diagnosis to death. The systematic data collection provides the essential data used to calculate population-based HIV case counts, HIV incidence estimates, describe the geographic distribution of disease, monitor HIV transmission and drug resistance patterns and genetic diversity of HIV among infected persons, detect and respond to HIV clusters of recent and rapid transmission, and monitor perinatal exposures. NHSS data are also used locally to identify persons with HIV who are not in medical care and linking them to care and needed services. NHSS data continue to be collected, maintained, and reported using standard case definitions, report forms and software. The system is periodically updated as needed to keep pace with changes in testing technology and advances in HIV care and treatment, as well as changing prevention program monitoring and evaluation needs.
CDC receives adult and pediatric HIV case reports from 59 areas. Additional information on perinatal exposures is also reported in a subset of jurisdictions when reportable using the same pediatric case report form used to monitor progress toward perinatal HIV elimination goals. Health department staff compile information from laboratories, physicians, hospitals, clinics, and other health care providers to complete the HIV adult and pediatric case reports. CDC estimates that approximately 789 adult HIV case reports and 57 perinatal exposure and pediatric case reports are processed by each health department annually.
These data are recorded using standard case report forms either on paper or electronically and entered into the electronic reporting system. Updates to case reports are also entered into the reporting system by health departments as additional information may be received from laboratories, vital statistics, or additional providers. Evaluations are also conducted by health departments on a subset of case reports (
Additional information will be reported by health departments for monitoring and evaluation of health department investigations including activities identifying persons who are not in HIV medical care and linking them to HIV medical care (
Clusters of HIV are groups of persons related by recent, rapid transmission, for which rapid response is needed to intervene and interrupt ongoing transmission and prevent future HIV infections. Health departments may detect clusters through multiple means, including through routine analyses of Surveillance data and other data reported to the NHSS. Summary data on clusters of recent and rapid HIV transmission in the United States are collected to monitor situations necessitating public health intervention, assess health department response, and evaluate outcomes of intervention activities. Health departments complete an Initial Cluster Report Form when a cluster is first identified, a Follow-up Cluster Report Form each quarter when response activities are ongoing, and an Annual/Closeout Cluster Report Form depending on the state of cluster response. CDC estimates on average health departments will provide information for 2.5 Initial Cluster Report Forms, 5 Follow-up Cluster Report Forms, and 2.5 Annual/Closeout Cluster Report Forms annually.
The Standards Evaluation Report (SER) is used by CDC and Health Departments to improve data quality, interpretation, usefulness, and surveillance system efficiency, as well as to monitor progress toward meeting surveillance program objectives. The information collected for the SER includes a brief set of questions about evaluation outcomes and the collection of laboratory data that will be reported one time a year by each of the 59 health departments.
There are no revisions to data collection or changes in burden requested in this Extension. The total estimated annualized burden is 60,731 hours.
In accordance with the Paperwork Reduction Act of 1995, the Centers for Disease Control and Prevention (CDC) has submitted the information collection request titled “Emergency Epidemic Investigation (EEI)” to the Office of Management and Budget (OMB) for review and approval. CDC previously published a “Proposed Data Collection Submitted for Public Comment and Recommendations” notice on June 16, 2025 to obtain comments from the public and affected agencies. CDC did not receive comments related to the previous notice. This notice serves to allow an additional 30 days for public and affected agency comments.
CDC will accept all comments for this proposed information collection project. The Office of Management and Budget is particularly interested in comments that:
(a) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(b) Evaluate the accuracy of the agencies estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(c) Enhance the quality, utility, and clarity of the information to be collected;
(d) Minimize the burden of the collection of information on those who are to respond, including, through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
(e) Assess information collection costs.
To request additional information on the proposed project or to obtain a copy of the information collection plan and instruments, call (404) 639-7570. Comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to
Emergency Epidemic Investigations (EEI) (OMB Control No. 0920-1011, Exp. 12/31/2025)—Extension—Office of Science (OS), Centers for Disease Control and Prevention (CDC).
CDC previously conducted Emergency Epidemic Investigations (EEIs) under Office of Management and Budget (OMB) Control Number 0920-0008. In 2013, CDC received OMB approval (OMB Control No. 0920-1011) for a New Generic Clearance to collect vital information during EEIs in response to outbreaks or other urgent public health events (
Supporting effective EEIs is one of the most important ways that CDC protects the health of the public. CDC is frequently called upon to conduct EEIs at the request of local, state, or international health authorities seeking support to respond to outbreaks or urgent public health events. In response to external partner requests, CDC provides the necessary epidemiologic support to identify the agents, sources, modes of transmission, or risk factors to effectively implement rapid prevention and control measures to protect the public's health. Data collection is a critical component of the epidemiologic support provided by CDC; data are analyzed to determine the agents, sources, modes of transmission, or risk factors so that effective prevention and control measures can be implemented. During an unanticipated outbreak or urgent public health event, immediate action by CDC is necessary to minimize or prevent public harm. The legal justification for EEIs is found in the Public Health Service Act (42 U.S.C. 301 [241] (a).
Successful investigations are dependent on rapid and flexible data collection that evolves during the investigation and is customized to the unique circumstances of each outbreak or urgent public health event. Data collection elements will be those necessary to identify the agents, sources, mode of transmission, or risk factors. Examples of potential data collection methods include telephone or face-to-face interviews; email, web, or other types of electronic questionnaires; paper-and-pencil questionnaires; focus groups; medical record review and abstraction; laboratory record review
CDC projects 20 EEIs in response to outbreaks or urgent public health events characterized by undetermined agents, undetermined sources, undetermined transmission, or undetermined risk factors annually. The projected average number of respondents is 200 per EEI, for a total of 4,000 respondents. CDC estimates the average burden per response is 0.5 hours and each respondent will be asked to respond once. Therefore, CDC requests OMB approval for an estimated 2,000 annual burden hours. These estimates are based on the reported burden for EEIs that has been performed during the previous approval periods.
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
Notice of meeting.
In accordance with the Federal Advisory Committee Act, the Centers for Disease Control and Prevention (CDC) announces the following meeting of the Advisory Council for the Elimination of Tuberculosis (ACET). This meeting is open to the public, limited only by the number of audio and web conference lines (1,000 lines are available). Time will be available for public comment (registration is required to provide oral comment; see the Oral Public Comment section below).
The meeting will be held on December 9-10, 2025, from 12 p.m. to 5 p.m., EST.
Written comments must be submitted by December 2, 2025. Registration to make oral comments must also be submitted by December 2, 2025.
The public meeting will be held virtually through Microsoft Teams. Advanced registration is required to attend. Please register for each day of this meeting.
For registration on December 9, 2025:
For registration on December 10, 2025:
Registration for virtual attendance will remain open through the meeting. Prior to the meeting, each individual registrant will receive a registration confirmation along with an access link to the virtual meeting location. Written public comments and requests to make oral comments should be sent to
ACET Committee Management, Office of Policy, Planning, and Partnerships, National Center for HIV, Viral Hepatitis, STD, and TB Prevention, Centers for Disease Control and Prevention. Email:
The Director, Office of Strategic Business Initiatives, Office of the Chief
Centers for Medicare & Medicaid Services, Health and Human Services (HHS).
Notice.
The Centers for Medicare & Medicaid Services (CMS) is announcing an opportunity for the public to comment on CMS' intention to collect information from the public. Under the Paperwork Reduction Act of 1995 (PRA), federal agencies are required to publish notice in the
Comments on the collection(s) of information must be received by the OMB desk officer by October 30, 2025.
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to
To obtain copies of a supporting statement and any related forms for the proposed collection(s) summarized in this notice, please access the CMS PRA website by copying and pasting the following web address into your web browser:
William Parham at (410) 786-4669.
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. The term “collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires federal agencies to publish a 30-day notice in the
1.
The survey will be disseminated to all 51 state Medicaid agencies (including the District of Columbia) and the Medicaid agencies of five US territories. States will be required to complete the survey in order to demonstrate that they are complaint with section 1903(l) of the Act by reporting on their EVV implementation status for PCS provided under sections 1905(a)(24), 1915(c), 1915(i), 1915(j), 1915(k), and Section 1115 of the Act; and HHCS provided under section 1905(a)(7) of the Act or under a demonstration project or waiver (
The survey will be a live form, meaning states will have the ability to update their section 1903(l) compliance status on a continuous basis. As FMAP reductions are assigned quarterly per section 1903(l) of the Act, states who are not in compliance will be asked to review their survey information on a quarterly basis to ensure it is up-to-date and to update their survey responses as needed until they come into compliance.
2.
3.
On October 29, 2013, we published CoPs, for CMHCs (78 FR 64630). The CoPs included the following:
On September 30, 2019, we published final rule, “
We finalized revisions to the CMHC CoPs in the “CY 2024 Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems Final Rule,” published on November 22, 2023 (88 FR 81540, 82076 through 82079). This final rule revised the following conditions of participation:
Medicare Part B covers partial hospitalization (PHP) services and intensive outpatient (IOP) services furnished by or under arrangements made by the CMHC if they are provided by a CMHC as defined in 42 CFR 410.110. Section 4162 of the Omnibus Budget Reconciliation Act of 1990 (OBRA 1990) (Pub. L. 101-508) amended sections 1832(a)(2) and 1861(ff)(3) of the Act to allow CMHCs to provide PHP services. Furthermore, the
The services provided by CMHCs must be furnished by, or under arrangement with a CMHC participating in the Medicare program. They must include the following:
• Prescribed by a physician and furnished under the general supervision of a physician.
• Subject to certification by a physician in accordance with 42 CFR 424.24(e)(1).
• Furnished under a treatment plan that meets the requirements of 42 CFR 424.24(e)(2).
• Provides outpatient services, including specialized outpatient services for children, elderly individuals, individuals with serious mental illness, and residents of its mental health service area who have been discharged from inpatient mental health facilities.
• Provides 24-hour-a-day emergency care services.
• Provides day treatment, partial hospitalization services (PHP) or intensive outpatient services (IOP) other than an individual's home or in an inpatient or residential setting, or psychosocial rehabilitation services.
• Provides screening for clients being considered for admission to State mental health facilities to determine the appropriateness of such services unless otherwise directed by State law.
• Meets applicable licensing or certification requirements for CMHCs in the state in which it is located.
• Provides at least 40 percent of its services to individuals who are not eligible for benefits under title XVIII of the Act.
We collect information on several health and safety aspects, such as
The primary users of this information will be Federal and State agency surveyors for determining through the survey process, whether a CMHC qualifies for approval or re-approval under Medicare. CMS and its contractors will use this information to review claims to determine whether the patient is eligible for the PHP or IOP benefit and whether the claim meets the criteria for coverage and Medicare payment. Lastly, the information will be used by CMHCs to ensure their own compliance with all requirements to assist in guiding their patient care and quality programs.
Office of Child Support Services, Administration for Children and Families, U.S. Department of Health and Human Services.
Request for public comments.
The Office of Child Support Services is requesting a 3-year extension of the Provision of Child Support Services in IV-D Cases under the Hague Child Support Convention; Federally Approved Forms (Office of Management and Budget (OMB) #: 0970-0488, expiration March 31, 2026). There are no changes requested to these forms.
In compliance with the requirements of the Paperwork Reduction Act of 1995, the Administration for Children and Families (ACF) is soliciting public comment on the specific aspects of the information collection described above. You can obtain copies of the proposed collection of information and submit comments by emailing
State and federal law require states to use federally approved case processing forms. Section 311(b) of UIFSA 2008, which has been enacted by all 50 states, the District of Columbia, Guam, Puerto Rico, and the Virgin Islands, requires states to use forms mandated by federal law. 45 CFR 303.7 also requires child support programs to use federally approved forms in intergovernmental IV-D cases unless a country has provided alternative forms as a part of its chapter in a Caseworker's Guide to Processing Cases with Foreign Reciprocating Countries.
Annual burden estimates have been updated to reflect a decrease in the nationwide child support case load since the most recent full OMB review and approval process in 2023. Therefore, the annual number of responses per respondent has decreased, resulting in an overall decrease in estimated annual burden. The number of respondents and estimated time per response has not changed.
Office of Refugee Resettlement, Administration for Children and Families, U.S. Department of Health and Human Services.
Request for public comments.
The Office of Refugee Resettlement (ORR), Administration for Children and Families (ACF), U.S. Department of Health and Human Services, is requesting expedited review of an information collection request from the Office of Management and Budget (OMB) and inviting public comments on the proposed collection. This request will ensure that ORR can continue to properly enact its mandates and comply with all applicable authorities related to the placement of unaccompanied alien children into a restrictive placement.
In compliance with the requirements of the Paperwork Reduction Act of 1995 (PRA), ACF is soliciting public comment on the specific aspects of the information collection described above. You can obtain copies of the proposed collection of information and submit comments by emailing
ORR is proposing the below-listed changes to the
Update terminology to align with ORR regulations and to comply with Executive Order 14168
• Reorganize where some information/fields appear in the form for clarity.
• Add a “Disability Considerations” subsection in “Section B: Placement Information” to meet requirements found in the
• Remove “Section B: ORR's Determination Related to Safety” to align the form with ORR's regulation and policy guide.
• Update “Section C: Reasons for Restrictive Placement” to align the placement criteria in the form with ORR's regulation and policy guide and to comply with
• Add “Translation” subsection to “Section E: Acknowledgement and Certification” to help ORR monitor form compliance with translation requirements in its regulation.
ORR has two versions of Form P-7 approved under this information collection. The first version, titled Unaccompanied [Alien] Child Referral, was created for the UAC Path system, which was never implemented. The second version, titled Intakes Placement Checklist, is a PDF version that is currently in use. ORR is only proposing revisions to the PDF version of this form.
• Change form title from “Intakes Placement Checklist” to “Intakes Restrictive Placement Checklist” to better align the form's title with its purpose.
• Reorganize “Section B: Heightened Supervision Facility Criteria” and “Section C: Secure Facility Criteria” for clarity.
• Update criteria and supporting factors in Sections B and C to align with ORR's regulation and policy guide.
• Add follow-up questions in Sections B and C to document what information was relied on the make the placement determination and clarify whether each placement criterion was met.
• Reword field labels and add a field to document the reason for the recommended level of care in “Section D: Placement Determination”
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of a draft guidance for industry entitled “E20 Adaptive Designs for Clinical Trials.” The draft guidance was prepared under the auspices of the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH). The draft guidance is intended to provide a transparent and harmonized set of recommendations for clinical trials with an adaptive design. The draft guidance focuses on principles for the planning, conduct, analysis, and interpretation of clinical trials with an adaptive design that aim to confirm the efficacy and support the benefit-risk assessment of a treatment. The draft guidance emphasizes principles that are critical for ensuring clinical trials produce reliable and interpretable results and that involve specific considerations with use of an adaptive design.
Submit either electronic or written comments on the draft guidance by December 1, 2025 to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance.
You may submit comments on any guidance at any time as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Dockets Management Staff, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
You may submit comments on any guidance at any time (see 21 CFR 10.115(g)(5)).
Submit written requests for single copies of the draft guidance to the Division of Drug Information, Center for Drug Evaluation and Research, Food and Drug Administration, 10001 New Hampshire Ave., Hillandale Building, 4th Floor, Silver Spring, MD 20993-0002. The guidance may also be obtained by mail by calling Center for Biologics Evaluation and Research at 1-800-835-4709 or 240-402-8010. See the
FDA is announcing the availability of a draft guidance for industry entitled “E20 Adaptive Designs for Clinical Trials.” The draft guidance was prepared under the auspices of ICH. ICH seeks to achieve greater regulatory harmonization worldwide to ensure that safe, effective, high-quality medicines are developed, registered, and maintained in the most resource-efficient manner.
By harmonizing the regulatory requirements in regions around the world, ICH guidelines enhance global drug development, improve manufacturing standards, and increase the availability of medications. For example, ICH guidelines have substantially reduced duplicative clinical studies, prevented unnecessary animal studies, standardized the reporting of important safety information, and standardized marketing application submissions.
The six Founding Members of the ICH are the FDA; the Pharmaceutical Research and Manufacturers of America; the European Commission; the European Federation of Pharmaceutical Industries Associations; the Japanese Ministry of Health, Labour, and Welfare; and the Japanese Pharmaceutical Manufacturers Association. The Standing Members of the ICH Association include Health Canada and Swissmedic. ICH membership continues to expand to include other regulatory authorities and industry associations from around the world (refer to
ICH works by engaging global regulatory and industry experts in a detailed, science-based, and consensus-driven process that results in the development of ICH guidelines. The regulators around the world are committed to consistently adopting these consensus-based guidelines, realizing the benefits for patients and for industry.
As a Founding Regulatory Member of ICH, FDA plays a major role in the development of each of the ICH guidelines, which FDA then adopts and issues as guidance for industry. FDA's guidance documents do not establish legally enforceable responsibilities. Instead, they describe the Agency's current thinking on a topic and should be viewed only as recommendations, unless specific regulatory or statutory requirements are cited.
In June 2025, the ICH Assembly endorsed the draft guideline entitled “E20 Adaptive Designs for Clinical Trials” and agreed that the guideline should be made available for public comment. The draft guideline is the product of the Efficacy Expert Working Group of the ICH. Comments about this draft will be considered by FDA and the Efficacy Expert Working Group.
The draft guidance provides transparent and harmonized recommendations for the planning, conduct, analysis, and interpretation of clinical trials with an adaptive design that aim to confirm the efficacy and support the benefit-risk assessment of a treatment. For the purpose of this draft guidance, an
This draft guidance has been left in the original ICH format. The final guidance will be reformatted and edited to conform with FDA's good guidance practices regulation (21 CFR 10.115) and style before publication. The draft guidance, when finalized, will represent the current thinking of FDA on “E20 Adaptive Designs for Clinical Trials.” It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations.
As we develop final guidance on this topic, FDA will consider comments on costs or cost savings the guidance may generate, relevant for Executive Order 14192.
While this guidance contains no collection of information, it does refer to previously approved FDA collections of information. The previously approved 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. 3501-3521). The collections of information in 21 CFR parts 50 and 56 relating to the protection of human subjects, informed consent, and institutional review boards have been approved under OMB control number 0910-0130. The collections of information in 21 CFR part 312 relating to submission of investigational new drug applications, including efficient approaches to clinical trial design, study protocols, and the operation of data monitoring committees, have been approved under OMB control number 0910-0014. The collections of information in 21 CFR part 314 relating to submission of new drug applications have been approved under OMB control number 0910-0001. The collections of information in 21 CFR part 601 relating to submission of biologic license applications have been approved under OMB control number 0910-0338. The collections of information in 21 CFR part 812 relating to investigational device exemption applications have been approved under OMB control number 0910-0078.
Persons with access to the internet may obtain the draft guidance at
Office of the Secretary, HHS.
Notice.
In compliance with the requirement of the Paperwork Reduction Act of 1995, the Office of the Secretary (OS), Department of Health and Human Services, is publishing the following summary of a proposed Information Collection Request (ICR) for public comment.
Comments on the ICR must be received on or before November 28, 2025.
Submit your comments to Sheila Garrity, Director, Office of Research Integrity
When submitting comments or requesting information, please include the document identifier 0937-0198-60D and project title for reference, to Sheila Garrity, Director, Office of Research Integrity
Interested persons are invited to send comments regarding this burden estimate or any other aspect of this collection of information, including any of the following subjects: (1) The necessity and utility of the proposed information collection for the proper performance of the agency's functions; (2) the accuracy of the estimated burden; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) the use of automated collection techniques or other forms of information technology to minimize the information collection burden.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, RFA-AI-24-080 Broad Spectrum Products Against Multiple Neurotoxin Botulinum Serotypes (R61/R33 Clinical Trial Not Allowed). November 14, 2025, 10:00 a.m. to November 14, 2025, 05:00 p.m., National Institutes of Health, Rockledge II, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the
This meeting is being amended to change the date from November 14, 2025, to December 2, 2025. The meeting is closed to the public.
Pursuant to section 1009 of the Federal Advisory Committee Act, as amended, notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material,
Pursuant to section 1009 of the Federal Advisory Committee Act, as amended, notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 1009 of the Federal Advisory Committee Act, as amended, notice is hereby given of a meeting of the Board of Scientific Counselors, National Institute on Alcohol Abuse and Alcoholism.
The meeting will be closed to the public as indicated below in accordance with the provisions set forth in section 552b(c)(6), Title 5 U.S.C., as amended for the review, discussion, and evaluation of individual intramural programs and projects conducted by the National Institute on Alcohol Abuse and Alcoholism, including consideration of personnel qualifications and performance, and the competence of individual investigators, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Information is also available on the Institute's/Center's home page:
Office of the Assistant Secretary for Policy Development and Research, HUD.
Notice.
This document designates “Difficult Development Areas” (DDAs) and “Qualified Census Tracts” (QCTs) for purposes of the Low-Income Housing Tax Credit (LIHTC) under Internal Revenue Code (IRC) Section 42. The United States Department of Housing and Urban Development (HUD) makes new DDA and QCT designations annually.
For questions on how areas are designated and on geographic definitions, contact Michael K. Hollar, Senior Economist, Public Finance and Regulatory Analysis Division, Office of Policy Development and Research, Department of Housing and Urban Development, 451 Seventh Street SW, Room 8216, Washington, DC 20410-6000; telephone number 202-402-5878, or send an email to
Under IRC Section 42(d)(5)(B)(iii)(I), for purposes of the LIHTC, the Secretary of HUD must designate DDAs, which are areas with high construction, land, and utility costs relative to area median gross income (AMGI). This notice designates DDAs for each of the 50 states, the District of Columbia, Puerto Rico, American Samoa, Guam, the Northern Mariana Islands, and the U.S. Virgin Islands. HUD makes the designations of DDAs in this notice based on modified Fiscal Year (FY) 2025 Small Area Fair Market Rents (Small Area FMRs, SAFMRs), FY 2025 nonmetropolitan county FMRs, FY 2025 income limits, and 2020 Census population counts, as explained below.
Similarly, under IRC Section 42(d)(5)(B)(ii)(I), the Secretary of HUD must designate QCTs, which are areas where either 50 percent or more of the households have an income less than 60 percent of the AMGI or have a poverty rate of at least 25 percent. This notice designates QCTs based on new income and poverty data released in the American Community Survey (ACS). Specifically, HUD relies on the most recent three sets of ACS data to ensure that anomalous estimates, due to sampling error, do not affect the QCT status of tracts.
HUD uses data from the 2020 Census on total population of metropolitan areas, metropolitan ZIP Code Tabulation Areas (ZCTAs), and nonmetropolitan areas in the designation of DDAs. The Office of Management and Budget (OMB) published updated metropolitan areas in OMB Bulletin No. 23-01 on July 21, 2023.
HUD uses data from the 2020 Census on total population of census tracts, metropolitan areas, and the nonmetropolitan parts of states in the designation of QCTs. The FY 2025 income limits HUD uses to designate QCTs are based on these MSA definitions with modifications to account for substantial differences in rental housing markets (and in some cases median family income levels) within MSAs. In this QCT designation, HUD uses the OMB metropolitan area definitions published in OMB Bulletin No. 23-01, without modification, for purposes of evaluating how many census tracts can be designated under the population cap but uses the HUD-modified definitions and their associated area median family incomes for determining QCT eligibility.
Because the 2020 Decennial Census did not include questions on respondent household income, HUD uses ACS data to designate QCTs. The ACS tabulates data collected over 5 years to provide estimates of socioeconomic variables for small areas containing fewer than 65,000 persons, such as census tracts. Due to sample-related anomalies in estimates from year to year, HUD uses three sets of ACS tabulations to minimize the effect of anomalous estimates on QCT status.
The U.S. Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) are authorized to interpret and enforce the provisions of IRC Section 42. In order to assist in understanding HUD's mandated designation of DDAs and QCTs for use in administering IRC Section 42, a summary of the section is provided below. The following summary does not purport to bind Treasury or the IRS in any way, nor does it purport to bind HUD, since HUD has authority to interpret or administer the IRC only in instances where it receives explicit statutory delegation.
The LIHTC is a tax incentive intended to increase the availability of low-income rental housing. IRC Section 42 provides an income tax credit to certain owners of newly constructed or substantially rehabilitated low-income rental housing projects. The dollar amount of the LIHTC available for allocation by each state (credit ceiling) is limited by population. Section 42 allows each state a credit ceiling based on a statutory formula indicated at IRC Section 42(h)(3). States may carry forward unallocated credits derived from the credit ceiling for one year; however, to the extent such unallocated credits are not used by then, the credits go into a national pool to be allocated to qualified states as additional credit. State and local housing agencies allocate the state's credit ceiling among low-income housing buildings whose owners have applied for the credit. Besides IRC Section 42 credits derived from the credit ceiling, states may also provide IRC Section 42 credits to owners of buildings based on the percentage of certain building costs financed by tax-exempt bond proceeds. Credits provided based on the use of tax-exempt bond proceeds do not reduce the credits available from the credit ceiling.
The credits allocated to a building are based on the cost of units placed in service as low-income units under particular minimum occupancy and maximum rent criteria. Prior to the enactment of the Consolidated Appropriations Act, 2018 (the 2018 Act), under IRC Section 42(g), a building was required to meet one of two tests to be eligible for the LIHTC; either: (1) 20 percent of the units must be rent-restricted and occupied by tenants with incomes no higher than 50 percent of AMGI, or (2) 40 percent of the units must be rent-restricted and occupied by tenants with incomes no higher than 60 percent of AMGI. A unit is “rent-restricted” if the gross rent, including an allowance for tenant-paid utilities, does not exceed 30 percent of the imputed income limitation (
The 2018 Act added a third test, the average income test.
The LIHTC reduces income tax liability dollar-for-dollar. It is taken annually for a term of 10 years and is intended to yield a present value of either: (1) 70 percent of the “qualified basis” for new construction or substantial rehabilitation expenditures that are not federally subsidized (as defined in IRC Section 42(i)(2)), or (2) 30 percent of the qualified basis for the cost of acquiring certain existing buildings or projects that are federally subsidized. The tax credit rates are determined monthly under procedures specified in IRC Section 42 and cannot be less than 9 percent for new buildings that are not federally subsidized, and cannot be less than 4 percent for buildings that are federally subsidized. Individuals can use the credits up to a deduction equivalent of $25,000 (the actual maximum amount of credit that an individual can claim depends on the individual's marginal tax rate). For buildings placed in service after December 31, 2007, individuals can use the credits against the alternative minimum tax. Corporations, other than S or personal service corporations, can use the credits against ordinary income tax, and, for buildings placed in service after December 31, 2007, against the alternative minimum tax. These corporations also can deduct losses from the project.
The qualified basis represents the product of the building's “applicable fraction” and its “eligible basis.” The applicable fraction is based on the number of low-income units in the building as a percentage of the total
As stated above, IRC Section 42 defines a DDA as an area designated by the Secretary of HUD that has high construction, land, and utility costs relative to the AMGI. All designated DDAs in metropolitan areas (taken together) may not contain more than 20 percent of the aggregate population of all metropolitan areas, and all designated areas not in metropolitan areas may not contain more than 20 percent of the aggregate population of all nonmetropolitan areas.
Similarly, IRC Section 42 defines a QCT as an area designated by the Secretary of HUD where, for the most recent year for which census data are available on household income in such tract, either 50 percent or more of the households in the tract have an income which is less than 60 percent of the AMGI or the tract's poverty rate is at least 25 percent. All designated QCTs in a single metropolitan area or nonmetropolitan area (taken together) may not contain more than 20 percent of the population of that metropolitan or nonmetropolitan area. Thus, unlike the restriction on DDA designations, QCTs are restricted by the total population of each individual area as opposed to the aggregate population across all metropolitan areas and nonmetropolitan areas.
IRC Section 42(d)(5)(B)(v) allows states to award an increase in basis up to 30 percent to buildings located outside of federally designated DDAs and QCTs if the increase is necessary to make the building financially feasible. This state discretion applies only to buildings allocated credits under the state housing credit ceiling and is not permitted for buildings receiving credits in connection with tax-exempt bonds. Rules for such designations shall be set forth in the LIHTC-allocating agencies' qualified allocation plans (QAPs).
In developing the 2026 list of DDAs, as required by IRC Section 42(d)(5)(B)(iii), HUD compared housing costs with incomes. HUD used 2020 Census population for ZCTAs, and nonmetropolitan areas, and the MSA definitions, as published in OMB Bulletin 23-01 on July 21, 2023. In keeping with past practice of basing the coming year's DDA designations on data from the preceding year, the basis for these comparisons is the FY 2025 HUD income limits for very low-income households (very low-income limits, or VLILs), which are based on 50 percent of AMGI, and modified FMRs based on the FY 2025 FMRs used for the Housing Choice Voucher (HCV) program. For metropolitan DDAs, HUD used Small Area FMRs based on three annual releases of ACS data, to compensate for statistical anomalies which affect estimates for some ZCTAs. For non-metropolitan DDAs, HUD used the FY 2025 FMRs published on August 14, 2024, and effective on October 1, 2024 (89 FR 66127), as updated by the March 28, 2025, publication effective April 28, 2025 (90 FR 14158). The FY 2025 SAFMRs and non-metropolitan county-based FMRs were calculated and published using the OMB metropolitan area definitions published in OMB Bulletin 18-03. HUD translated the FY 2025 SAFMRs and county-based FMRs into the metropolitan area definitions published in OMB Bulletin 23-01 in order to match the FY 2025 SAFMRs and county-based FMRs to the FY 2025 VLILs, which were published using the metropolitan area definitions published in OMB Bulletin 23-01.
In formulating the FY 2025 FMRs and VLILs, HUD modified the current OMB definitions of MSAs to account for differences in rents among areas within each current MSA that were in different FMR areas under definitions used in prior years. HUD formed these “HUD Metro FMR Areas” (HMFAs) in cases where one or more of the parts of newly defined MSAs were previously in separate FMR areas. All counties added to metropolitan areas are treated as HMFAs with rents and incomes based on their own county data, where available. All HMFAs are contained entirely within MSAs. All nonmetropolitan counties are outside of MSAs and are not broken up by HUD for purposes of setting FMRs and VLILs. (Complete details on HUD's process for determining FY 2025 FMR areas and FMRs are available at
HUD's unit of analysis for designating metropolitan DDAs consists of ZCTAs, whose Small Area FMRs are compared to metropolitan VLILs. For purposes of computing VLILs in metropolitan areas, HUD considers entire MSAs in cases where these were not broken up into HMFAs; and HMFAs within the MSAs that were broken up for such purposes. Hereafter in this notice, the unit of analysis for designating metropolitan DDAs will be called the ZCTA, and the unit of analysis for nonmetropolitan DDAs will be the nonmetropolitan county or county equivalent area. The procedure used in making the DDA designations follows:
1.
The modified FY 2025 two-bedroom Small Area FMRs for ZCTAs differ from the FY 2025 Small Area FMRs in four ways. First, HUD did not limit the Small Area FMR to 150 percent of its metropolitan area FMR. Second, HUD did not limit annual decreases in Small Area FMRs to ten percent, which was first applied in the FY 2018 FMR calculations. Third, HUD adjusted the Small Area FMRs in New York City using the New York City Housing and Vacancy Survey, which is conducted by the U.S. Census Bureau, to adjust for the effect of local rent control and stabilization regulations. No other jurisdictions have provided HUD with data that could be used to adjust Small Area FMRs for rent control or stabilization regulations.
The FY 2025 two-bedroom FMR for non-metropolitan counties was modified only by removing the state non-metropolitan minimum FMR.
The numerator of the ratio, representing the development cost of housing, was the area's modified FY 2025 FMR, or modified Small Area FMR in metropolitan areas. In general, the FMR is based on the 40th-percentile gross rent paid by recent movers to live in a standard quality two-bedroom rental unit.
The denominator of the ratio, representing the maximum income of eligible tenants, was the monthly LIHTC income-based rent limit, which was calculated as 1/12 of 30 percent of 120 percent of the area's 4-person VLIL (where the VLIL was rounded to the nearest $50).
2.
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In identifying DDAs, HUD applied caps, or limitations, as noted above. The cumulative population of metropolitan DDAs cannot exceed 20 percent of the cumulative population of all metropolitan areas, and the cumulative population of nonmetropolitan DDAs cannot exceed 20 percent of the cumulative population of all nonmetropolitan areas.
In applying these caps, HUD established procedures to deal with how to treat small overruns of the caps. The remainder of this section explains those procedures. In general, HUD stops selecting areas when it is impossible to choose another area without exceeding the applicable cap. The only exceptions to this policy are when the next eligible excluded area contains either a large absolute population or a large percentage of the total population, or the next excluded area's ranking ratio, as described above, was identical (to four decimal places) to the last area selected, and its inclusion resulted in only a minor overrun of the cap. Thus, for both the designated metropolitan and nonmetropolitan DDAs, there may be minimal overruns of the cap. HUD believes the designation of additional areas in the above examples of minimal overruns is consistent with the intent of the IRC. As long as the apparent excess is small due to measurement errors, some latitude is justifiable, because it is impossible to determine whether the 20 percent cap has been exceeded. Despite the care and effort involved in a Decennial Census, the Census Bureau and all users of the data recognize that the population counts for a given area and for the entire country are not precise. Therefore, the extent of the measurement error is unknown. There can be errors in both the numerator and denominator of the ratio of populations used in applying a 20 percent cap. In circumstances where a strict application of a 20 percent cap results in an anomalous situation, recognition of the unavoidable imprecision in the census data justifies accepting small variances above the 20 percent limit.
In developing the list of QCTs, HUD used 2020 Census 100-percent count data on total population, total households, and population in households; the median household income and poverty rate as estimated in the 2017-2021, 2018-2022 and 2019-2023 ACS tabulations; the FY 2025 Very Low-Income Limits (VLILs) computed at the HMFA level to determine tract eligibility; and the MSA definitions published in OMB Bulletin No. 23-01 on July 21, 2023, for determining how many eligible tracts can be designated under the statutory 20 percent population cap.
HUD uses the HMFA-level AMGIs to determine QCT eligibility because the statute, specifically IRC Section 42(d)(5)(B)(iv)(II), refers to the same section of the IRC that defines income for purposes of tenant eligibility and unit maximum rent, specifically IRC Section 42(g)(4). By rule, the IRS sets these income limits according to HUD's VLILs, which, starting in FY 2006 and thereafter, are established at the HMFA level. HUD uses the entire MSA to determine how many eligible tracts can be designated under the 20 percent population cap as required by the statute (IRC Section 42(d)(5)(B)(ii)(III)), which states that MSAs should be treated as singular areas.
HUD determined the QCTs as follows:
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a. The statistically reliable income and poverty criteria are each averaged over the three ACS tabulations (2017-2021, 2018-2022 and 2019-2023). Statistically reliable values that did not exceed the income and poverty rate thresholds were included in the average.
b. Eligible tracts are placed in one of two groups based on the averaged values of the income and poverty criteria. The first group includes tracts that satisfy both the income and poverty criteria for QCTs for at least two of the three evaluation years; a different pair of years may be used to meet each criterion. The second group includes tracts that satisfy either the income criterion in at least two of the three years, or the poverty criterion in at least two of three years, but not both. A tract must qualify by at least one of the criteria in at least two of the three evaluation years to be eligible.
c. HUD ranked tracts in the first group from highest to lowest by the average of the ratios of the tract average-household-size-adjusted income limit to the median household income. Then, HUD ranked tracts in the first group from highest to lowest by the average of the poverty rates. HUD averaged the two ranks to yield a combined rank. HUD then sorted the tracts on the combined rank, with the census tract with the highest combined rank being placed at the top of the sorted list. In the event of a tie, HUD ranked more populous tracts above less populous ones.
d. HUD ranked tracts in the second group from highest to lowest by the average of the ratios of the tract average-household-size-adjusted income limit to the median household income. Then, HUD ranked tracts in the second group from highest to lowest by the average of the poverty rates. HUD then averaged the two ranks to yield a combined rank. HUD then sorted the tracts on the combined rank, with the census tract with the highest combined rank being placed at the top of the sorted list. In the event of a tie, HUD ranked more populous tracts above less populous ones.
e. HUD stacked the ranked first group on top of the ranked second group to yield a single, concatenated, ranked list of eligible census tracts.
f. Working down the single, concatenated, ranked list of eligible tracts, HUD identified census tracts as designated until the designation of an additional tract would cause the 20 percent limit to be exceeded. If HUD does not designate a census tract because doing so would raise the percentage above 20 percent, HUD then considers subsequent eligible census tracts to determine whether one or more eligible census tract(s) with smaller population(s) could be designated without exceeding the 20 percent limit.
As stated in OMB Bulletin 23-01, defining metropolitan areas:
“OMB establishes and maintains the delineations of Core Based Statistical Areas solely for statistical purposes. . . . OMB does not take into account or attempt to anticipate any non-statistical uses that may be made of the delineations[.] . . . In cases where . . . an agency elects to use the Core Based Statistical Area definitions in non-statistical programs, it is that agency's responsibility to ensure that the delineations are appropriate for such use. . . . [A]n agency using the statistical delineations in a non-statistical program may modify the delineations; however, such potential modification would apply only to the purposes of that program. In such cases, any deviations from the Core Based Statistical Areas delineated by OMB should be clearly identified as such, in order to avoid confusion.”
Following OMB guidance, HUD's estimation procedure for the FMRs and income limits incorporates the OMB definitions of metropolitan Core-Based Statistical Areas (CBSAs) based on the CBSA standards, but makes adjustments to the definitions, in order to separate subparts of these areas in cases where counties were added to an existing or newly defined metropolitan area. In CBSAs where HUD establishes subareas, it is HUD's view that the geographic extent of the housing markets is not the same as the geographic extent of the CBSAs.
In the New England states (Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont), HUD defines HMFAs according to county subdivisions or minor civil divisions (MCDs), rather than county or county-equivalent boundaries. However, since no part of an HMFA is outside an OMB-defined, county-based MSA, all New England nonmetropolitan counties are kept intact for purposes of designating Nonmetropolitan DDAs.
HUD designates DDAs annually as updated HUD income limit and FMR data are made public. HUD designates QCTs annually as new income and poverty rate data are released.
The 2026 lists of QCTs and DDAs are effective:
(1) for allocations of credit after December 31, 2025; or
(2) for purposes of IRC Section 42(h)(4), if the bonds are issued and the building is placed in service after December 31, 2025.
If an area is not on a subsequent list of QCTs or DDAs, the 2026 lists are effective for the area if:
(1) the allocation of credit to an applicant is made no later than the end of the 730-day period after the applicant submits a complete application to the LIHTC-allocating agency, and the submission is made before the effective date of the subsequent lists; or
(2) for purposes of IRC Section 42(h)(4), if:
(a) the bonds are issued or the building is placed in service no later
(b) the submission is made before the effective date of the subsequent lists, provided that both the issuance of the bonds and the placement in service of the building occur after the application is submitted.
An application is deemed to be submitted on the date it is filed if the application is determined to be complete by the credit-allocating or bond-issuing agency. A “complete application” means that no more than de minimis clarification of the application is required for the agency to make a decision about the allocation of tax credits or issuance of bonds requested in the application.
In the case of a “multiphase project,” the DDA or QCT status of the site of the project that applies for all phases of the project is that which applied when the project received its first allocation of LIHTC. For purposes of IRC Section 42(h)(4), the DDA or QCT status of the site of the project that applies for all phases of the project is that which applied when the first of the following occurred: (a) the building(s) in the first phase was (were) placed in service, or (b) the bonds were issued.
For purposes of this notice, a “multiphase project” is defined as a set of buildings to be constructed or rehabilitated under the rules of the LIHTC and meeting the following criteria:
(1) the multiphase composition of the project (
(2) the aggregate amount of LIHTC applied for on behalf of, or that would eventually be allocated to, the buildings on the site exceeds the one-year limitation on credits per applicant, as defined in the QAP of the LIHTC-allocating agency, or the annual per-capita credit authority of the LIHTC allocating agency, and is the reason the applicant must request multiple allocations over 2 or more years; and
(3) all applications for LIHTC for buildings on the site are made in immediately consecutive years.
Members of the public are hereby reminded that the Secretary of Housing and Urban Development, or the Secretary's designee, has legal authority to designate DDAs and QCTs, by publishing lists of geographic entities as defined by, in the case of DDAs, the Census Bureau, the several states and the governments of the insular areas of the United States and, in the case of QCTs, by the Census Bureau; and to establish the effective dates of such lists. The Secretary of the Treasury, through the IRS thereof, has sole legal authority to interpret, and to determine and enforce compliance with the IRC and associated regulations, including
For the convenience of readers of this notice, interpretive examples are provided below to illustrate the consequences of the effective date in areas that gain or lose QCT or DDA status. The examples covering DDAs are equally applicable to QCT designations.
(Case A) Project A is located in a 2026 DDA that is NOT a designated DDA in 2027 or 2028. A complete application for tax credits for Project A is filed with the allocating agency on November 15, 2026. Credits are allocated to Project A on October 30, 2028. Project A is eligible for the increase in basis accorded a project in a 2026 DDA because the application was filed BEFORE January 1, 2027 (the assumed effective date for the 2027 DDA lists), and because tax credits were allocated no later than the end of the 730-day period after the filing of the complete application for an allocation of tax credits.
(Case B) Project B is located in a 2026 DDA that is NOT a designated DDA in 2027 or 2028. A complete application for tax credits for Project B is filed with the allocating agency on December 1, 2026. Credits are allocated to Project B on March 30, 2029. Project B is NOT eligible for the increase in basis accorded a project in a 2026 DDA because, although the application for an allocation of tax credits was filed BEFORE January 1, 2027 (the assumed effective date of the 2027 DDA lists), the tax credits were allocated later than the end of the 730-day period after the filing of the complete application.
(Case C) Project C is located in a 2026 DDA that was not a DDA in 2025. Project C was placed in service on November 15, 2025. A complete application for tax-exempt bond financing for Project C is filed with the bond-issuing agency on January 15, 2026. The tax-exempt bonds that will support the permanent financing of Project C are issued on September 30, 2026. Project C is NOT eligible for the increase in basis otherwise accorded a project in a 2026 DDA, because the project was placed in service BEFORE January 1, 2026.
(Case D) Project D is located in an area that is a DDA in 2026 but is NOT a DDA in 2027 or 2028. A complete application for tax-exempt bond financing for Project D is filed with the bond-issuing agency on October 30, 2026. Tax-exempt bonds are issued for Project D on April 30, 2028, but Project D is not placed in service until January 30, 2029. Project D is eligible for the increase in basis available to projects located in 2026 DDAs because: (1) one of the two events necessary for triggering the effective date for buildings described in Section 42(h)(4)(B) of the IRC (the two events being tax-exempt bonds issued and buildings placed in service) took place on April 30, 2028, within the 730-day period after a complete application for tax-exempt bond financing was filed, (2) the application was filed during a time when the location of Project D was in a DDA, and (3) both the issuance of the tax-exempt bonds and placement in service of Project D occurred after the application was submitted.
(Case E) Project E is a multiphase project located in a 2026 DDA that is NOT a designated DDA or QCT in 2027. The first phase of Project E received an allocation of credits in 2026, pursuant to an application filed March 15, 2026, which describes the multiphase composition of the project. An application for tax credits for the second phase of Project E is filed with the allocating agency by the same entity on March 15, 2027. The second phase of Project E is located on a contiguous site. Credits are allocated to the second phase of Project E on October 30, 2027. The aggregate amount of credits allocated to the two phases of Project E exceeds the amount of credits that may be allocated to an applicant in one year under the allocating agency's QAP and is the reason that applications were made in multiple phases. The second phase of Project E is, therefore, eligible for the increase in basis accorded a project in a 2026 DDA, because it meets all of the conditions to be a part of a multiphase project.
(Case F) Project F is a multiphase project located in a 2026 DDA that is NOT a designated DDA in 2027 or 2028. The first phase of Project F received an allocation of credits in 2026, pursuant to an application filed March 15, 2026, which does not describe the multiphase composition of the project. An application for tax credits for the second phase of Project F is filed with the allocating agency by the same entity on March 15, 2028. Credits are allocated to the second phase of Project F on October 30, 2028. The aggregate amount of credits allocated to the two phases of Project F exceeds the amount of credits that may be allocated to an applicant in one year under the allocating agency's QAP. The second phase of Project F is, therefore, NOT eligible for the increase in basis accorded a project in a 2026 DDA, since it does not meet all of the conditions for a multiphase project, as defined in this notice. The original application for credits for the first phase did not describe the multiphase composition of the project. Also, the application for credits for the second phase of Project F was not made in the year immediately following the first phase application year.
(Case G) Project G is located in an area that is NOT a DDA in 2026 or 2028, but is in a DDA in 2027. A complete application for tax-exempt bond financing for Project G is filed with the bond-issuing agency on October 30, 2026. Project G is placed in service on November 15, 2027 and the bonds are issued on February 20, 2028. Property G is eligible for the increase in basis available to projects located in 2027 DDAs because one of the two necessary actions (the two events being tax-exempt bonds issued and buildings placed in service) occur when the property is in a DDA and both events occur after January 1, 2027, the assumed effective date of the 2027 DDAs.
This notice involves the statutorily required establishment of fiscal requirements or procedures that are related to rate and cost determinations and do not constitute a development decision affecting the physical condition of specific project areas or building sites. Accordingly, under 24 CFR 50.19(c)(6) of HUD's regulations, this notice is categorically excluded from environmental review under the National Environmental Policy Act of 1969 (42 U.S.C. 4321,
Executive Order 13132 (entitled “Federalism”) prohibits an agency from publishing any policy document that has federalism implications if the document either imposes substantial direct compliance costs on state and local governments and is not required by statute, or the document preempts state law, unless the agency meets the consultation and funding requirements of section 6 of the executive order. This notice merely designates DDAs and QCTs as required under IRC Section 42, as amended, for the use by political subdivisions of the states in allocating the LIHTC. This notice also details the technical methods used in making such designations. As a result, this notice is not subject to review under the order.
Office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD.
Notice of request for nominations to serve on the Manufactured Housing Consensus Committee.
The Department of Housing and Urban Development (HUD or the Department) invites the public to nominate individuals for appointment, with the approval of the Secretary, to the Manufactured Housing Consensus Committee, a federal advisory committee established by the National Manufactured Housing Construction and Safety Standards Act of 1974, as amended by the Manufactured Housing Improvement Act of 2000. HUD will make appointments from nominations submitted in response to this notice but prior nominations on file will not be considered for appointments. Current MHCC members whose first term ends on December 31, 2025, are eligible for reappointment, but will need to submit their nomination to be considered.
The Department will accept nominations until October 30, 2025.
Nominations must be submitted through the following website:
Mary Jo Houton, Administrator, Office of Manufactured Housing Programs, Department of Housing and Urban Development, 451 7th Street SW, Room 9166, Washington, DC 20410; telephone 202-708-6423 (this is not a toll-free number), email
Section 604 of the Manufactured Housing Improvement Act of 2000 amended the National Manufactured Housing Construction and Safety Standards Act of 1974 (Pub. L. 106-569, 114 Stat. 2944, 42 U.S.C. 5401-5426) (the Act) to require the establishment of the Manufactured Housing Consensus Committee (MHCC), a federal advisory committee, to:
(1) Provide periodic recommendations to the Secretary to adopt, revise, and interpret the manufactured housing construction and safety standards; and
(2) Provide periodic recommendations to the Secretary to adopt, revise, and interpret the procedural and enforcement manufactured housing regulations.
The Act authorizes the Secretary to appoint a total of twenty-two members to the MHCC. Twenty-one members have voting rights. The twenty-second member represents the Secretary and is a non-voting position. Service on the MHCC is voluntary. Travel and per diem for meetings is provided in accordance with federal travel policy pursuant to 5 U.S.C. 5703.
HUD encourages nominations of highly qualified and motivated individuals with expertise and interest in manufactured housing, who meet the requirements set forth in the Act to serve as voting members on the MHCC for up to two terms of three years each. The MHCC expects to meet at least one
Members of the MHCC are appointed to serve in one of three member categories. Nominees will be appointed to fill voting member vacancies in the following categories:
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3.
The Act provides that the Secretary shall ensure that all interests directly and materially affected by the work of the MHCC have the opportunity for fair and equitable participation without dominance by any single interest. The Secretary may reject the appointment of any one or more individuals to ensure that there is not dominance by any single interest. For purposes of this determination, dominance is defined as a position or exercise of dominant authority, leadership, or influence by reason of superior leverage, strength, or representation.
Additional requirements governing appointment and member service include:
(1) Nominees appointed to the User category and three of the individuals appointed to the General Interest and Public Official category shall not have a significant financial interest in any segment of the manufactured housing industry or a significant relationship to any person engaged in the manufactured housing industry.
(2) Each member serving in the User category shall be subject to a ban disallowing compensation from the manufactured housing industry during the period of, and during the one year following, his or her membership on the MHCC.
(3) Nominees selected for appointment to the MHCC shall be required to provide disclosures and certifications regarding conflict-of-interest and eligibility for membership prior to finalizing an appointment.
All selected nominees will be required to submit certifications of eligibility under the foregoing criteria as a prerequisite to final appointment.
The MHCC's role is solely to advise the Secretary on the subject matter described above.
The MHCC is subject to the requirements of the Federal Advisory Committee Act (5 U.S.C. Ch. 10, 41 CFR parts 101-6 and 102-3 (the FACA Final Rule), and to the Presidential Memorandum, dated June 18, 2010, directing all heads of executive departments and agencies not to make any new appointments or reappointments of federally registered lobbyists to advisory committees and other boards and commissions. The June 18, 2010, Presidential Memorandum titled “Lobbyists on Agency Boards and Commissions” authorized the Director of the Office of Management and Budget (OMB) to issue guidance to implement this policy. OMB published a Notice on the requirements in the
MHCC members serve at the discretion of the Secretary or for a three-year term, up to two terms.
Individuals seeking nomination to the MHCC should submit detailed information documenting their qualifications as addressed in the Act and this notice. HUD encourages applications from individuals with engineering or technical backgrounds relevant to design, construction, safety, or performance of manufactured homes. The MHCC benefits from participation of individuals with expertise in areas such as structural engineering, mechanical or electrical engineering, and other technical disciplines. Applicants may briefly summarize why they want to be a member of the MHCC and include unique skills, knowledge, and experiences that they would bring to inform the work of the committee. Individuals may nominate themselves. HUD recommends that the application be accompanied by a resume.
The Department will make appointments and reappointments from nominations submitted in response to this Notice. To be considered for appointment to a position of a MHCC member whose term will expire December 31, 2025, or to fill any MHCC vacancy that currently exists, the application must be submitted by October 30, 2025. Appointments will be made at the discretion of the Secretary.
Office of the Assistant Secretary for Public and Indian Housing (PIH), HUD.
Notice.
This notice further extends the compliance date for HUD's National Standards for the Physical Inspection of Real Estate (NSPIRE) final rule for the Housing Choice Voucher (HCV), Project-Based Voucher (PBV), and Section 8 Moderate Rehabilitation (Mod Rehab) programs through January 31, 2027. HUD is taking this action to provide Public Housing Agencies (PHAs) with additional time to implement HUD's NSPIRE standards and the change to the definition of Housing Quality Standards (HQS). This is the third extension of this compliance date.
PHAs subject to 24 CFR parts 882, 982, and 983 are not required to comply with the following changes to these parts in the NSPIRE final rule until February 1, 2027.
• 24 CFR 982.4, definition of
• 24 CFR 982.401, including the subsequent changes made by the HOTMA voucher final rule.
• 24 CFR part 982 subpart M, including the subsequent changes made by the HOTMA voucher final rule, except 24 CFR 982.628(d).
• 24 CFR 983.3, definition of
• 24 CFR 983.101(a)-(b), including the subsequent changes made by the HOTMA voucher final rule.
All other changes are in effect as required by the NSPIRE and HOTMA voucher final rules.
Dana Kitchen, Real Estate Assessment Center, Office of Public and Indian Housing, Department of Housing and Urban Development, 550 12th Street SW, Suite 100, Washington, DC 20410-4000; telephone (612) 370-3089 (this is not a toll-free number), email
Many PHAs administering the HCV, PBV, and Mod Rehab programs currently use HQS for inspections, previously defined at 24 CFR 982.401. HUD's Economic Growth Regulatory Relief and Consumer Protection Act: Implementation of National Standards for Physical Inspection of Real Estate (NSPIRE) final rule (“NSPIRE final rule”) (88 FR 30442), published on May 11, 2023, includes amendments to 24 CFR parts 882, 982, and 983 (among others), effective October 1, 2023. HUD has delayed the compliance date for the HCV, PBV, and Mod Rehab programs twice. In September 2023 (88 FR 66882), the compliance date was delayed until October 1, 2024, and in July 2024 (89 FR 55645), the compliance date was delayed until October 1, 2025. These delays allowed PHAs additional time to implement NSPIRE.
With this notice, HUD has included specific provisions to clarify the intent of the extension. Reference to the Housing Opportunities Through Modernization Act (HOTMA) voucher final rule (89 FR 38224) is due to its subsequent amendments to many of the NSPIRE final rule provisions and definitions. For example, the NSPIRE final rule changed 24 CFR 982.4, definition of
However, other provisions included in the NSPIRE final rule (whether amended by HOTMA or not), such as 24 CFR 982.352(b)(1)(iv)(A)(3), which references the duties of independent entities in PHA-owned eligible housing, became effective as required and are not included in the provisions extended by this notice.
Through this notice, HUD further delays the compliance date for the HCV, PBV, and Mod Rehab programs until February 1, 2027. HUD continues to encourage PHAs that are ready to implement NSPIRE to proceed with implementation at their earliest convenience; however, HUD has determined that additional time is necessary for many PHAs to implement NSPIRE for the HCV, PBV, and Mod Rehab programs. This extension will provide PHAs with additional time to train their staff, communicate with landlords, and access additional technical assistance from HUD to support their transition to the NSPIRE standards.
PHAs and industry groups representing PHAs have reported to HUD their concerns related to landlord participation in the HCV and PBV programs. PHAs continue to face challenges in recruiting and retaining private landlords. Many PHAs report experiencing a significant loss in landlord participation and fear that a major change to the inspection processes and standards may exacerbate the problem. PHAs have urged HUD to consider additional delays to allow them more time to transition their staff and landlords/owners to the NSPIRE standards. Additionally, PHAs report that many private software vendors have not finished developing their NSPIRE-related inspection products for the PHAs, and, because HUD has paused the release of its inspection application, some PHAs may need additional time to prepare for another option.
All PHAs that have implemented NSPIRE, but have not yet notified HUD, should notify HUD of the date they transitioned to NSPIRE. In addition, PHAs that have not implemented NSPIRE, should notify HUD of the date they plan to implement NSPIRE. These notifications are to be sent via email to
HUD extends the compliance date for the changes made to 24 CFR parts 882, 982, and 983 listed in the
Office of Community Planning and Development, U.S. Department of
Notice.
This notice further extends the compliance date for HUD's National Standards for the Physical Inspection of Real Estate (NSPIRE) final rule for Community Planning and Development (CPD) programs. Specifically, the Department is extending the compliance date for the Emergency Solutions Grants (ESG), Continuum of Care (CoC) HOME Investment Partnerships Program (HOME), and Housing Trust Fund (HTF) programs (“CPD programs”), until October 1, 2026. HUD is taking this action to allow recipients and grantees additional time to implement the Department's NSPIRE standards.
For the ESG and CoC programs: Norm Suchar, Director, for the Office of Special Needs Assistance Programs (SNAPs), Room 7262, Department of Housing and Urban Development, 451 Seventh Street SW, Washington, DC 20410-7000; telephone (202) 708-5015, (this is not a toll-free number).
For the HOME and HTF programs: Peter Huber, Acting Director, for the Office of Affordable Housing Programs (OAHP), Room 7160, Department of Housing and Urban Development, 451 Seventh Street SW, Washington, DC 20410-7000; telephone (202) 402-3941 (this is not a toll-free number).
HUD welcomes and is prepared to receive calls from individuals who are deaf or hard of hearing, as well as individuals with speech or communication disabilities. To learn more about how to make an accessible telephone call, please visit:
For CPD programs, the NSPIRE final rule included amendments to 24 CFR parts 92, 93, 576, and 578 to conform their various inspection requirements to NSPIRE and established an effective date for these amendments of October 1, 2023. In September 2023, the Department delayed the compliance date for CPD programs (88 FR 63971) and for the Housing Choice Voucher and Project-Based Voucher programs (88 FR 66882) until October 1, 2024, to allow Public Housing Agencies (PHA), jurisdictions, participants, and HUD grantees additional time for implementation. In July 2024, the Department again delayed the compliance date for CPD programs until October 1, 2025, to allow PHAs, jurisdictions, participants, and HUD grantees additional time for implementation (89 FR 55645).
Through this notice, the Department further delays the compliance date for CPD programs until October 1, 2026. HUD encourages any recipients and grantees that are ready to implement NSPIRE to do so at their earliest convenience. However, the Department has determined that some types of units funded under the CoC and ESG programs may not meet certain requirements of the NSPIRE standards as they are applied to other HUD programs. Previously stated in the last compliance date extension for CPD programs, the Department intends to publish standards specific to each of these programs before the compliance date. These notices have not yet been published, and it will be a challenge for grantees to revise their inspection procedures in time. HUD seeks to ensure that all unit types currently funded by the CoC and ESG programs can meet the NSPIRE Standards for the ESG and CoC Programs when they are published.
In addition, the NSPIRE final rule provides that the Department will publish lists of specific deficiencies in a
Nothing in this extension of the compliance date prevents CoC and ESG recipients, or subrecipients, from using NSPIRE standards before October 1, 2026. Those that choose to implement NSPIRE standards prior to October 1, 2026, must document the chosen compliance date in program records. Those that have adopted the standards established at 88 FR 40832 must continue to follow those standards. Those that wish to follow the former program requirements may do so until the new compliance date. However, when HUD issues the standards specific to the ESG and CoC programs, all grantees and recipients will be expected to prepare for the compliance date by updating their policies and procedures to reflect the program-specific standards.
CoC and ESG recipients who will implement NSPIRE prior to the new compliance date of October 1, 2026, must document the chosen compliance date in program records. Nothing in this extension of the compliance date prevents CoC and ESG recipients from using NSPIRE standards prior to October 1, 2026. The Department also intends to publish, through a
HUD-assisted rental housing is required to comply with Federal Fire Safety Act of 1992 which requires smoke alarms installed in accordance with the National Fire Protection Association Standard 72, or any successor standard thereto.
Participating jurisdictions and HTF grantees should prepare for the compliance date by updating property standard regulatory citations and requirements in written agreement templates with State recipients, subrecipients, and project owners, as required by 24 CFR 92.504(c) and 24 CFR 93.404(c). However, nothing in this extension of the compliance date prevents participating jurisdictions and HTF grantees from implementing the NSPIRE final rule immediately. Participating jurisdictions and HTF grantees that intend to comply with the changes in the NSPIRE final rule as of the effective date should review the deficiencies established in the NSPIRE Standards notice at 88 FR 40832 and compare these requirements to their existing rehabilitation and property standards and their inspection
In addition, participating jurisdictions and HTF grantees cannot impose new requirements resulting from updated regulations on project owners unless the written agreements with owners for the funds permit the participating jurisdiction or HTF grantee to do so. Consequently, participating jurisdictions or HTF grantees must determine whether the requirements applied in the written agreements that are fully executed before the effective date of the NSPIRE final rule are automatically updated when regulatory changes take effect or if such agreements must be amended to apply the new or updated requirements. This is an important consideration when participating jurisdictions or HTF grantees would like to apply the NSPIRE final rule rehabilitation and ongoing HOME or HTF property standard requirements to projects with commitments made prior to the effective date of the NSPIRE final rule and for HOME or HTF projects that are jointly funded by another HUD program with an earlier NSPIRE final rule effective date.
Accordingly, the Department revises the October 1, 2025, compliance date for the changes made to 24 CFR parts 92, 93, 576, and 578 to October 1, 2026, at which time recipients subject to these parts must comply with the NSPIRE final rule. Until October 1, 2026, recipients and grantees subject to these parts may instead choose to comply with these parts as they existed prior to October 1, 2023.
U.S. Geological Survey, Interior.
Notice of availability of record of decision.
The U.S. Department of the Interior (DOI), U.S. Geological Survey (USGS), announces the availability of the record of decision (ROD) for the proposal to develop an updated facility for the National Wildlife Health Center (NWHC) in Madison, Wisconsin. This preferred alternative decision follows a comprehensive environmental review and considers input and feedback from Federal, State, and local agencies; Tribes; public officials; organizations; and the public.
The ROD was signed and became effective April 10, 2025.
Jordan Sizemore, National Environmental Policy Act (NEPA) Project Manager, by phone at 360-929-0783, or by email at
(1) The ROD, pursuant to the NEPA of 1969, 42 U.S.C. 4321
(2) The decision is based on information and analysis contained in the draft environmental impact statement (EIS) issued June 14, 2024, and the final EIS issued November 22, 2024. These documents outline the USGS's considerations and evaluation of the environmental consequences in making a decision on the proposed action. The USGS considerations were informed by comments and input received from elected and appointed officials; Federal, State, county, and local agencies; federally recognized Tribes; organizations; and individuals.
The NWHC operates out of two primary buildings, the Main Building, constructed in the 1960s and renovated in 1982, and the Tight Isolation Building, constructed in 1985 and modified in 1989. Starting in 2008, multiple studies of the current facilities found over-crowded laboratories and administrative areas; inefficient infrastructure (
The purpose of the proposed action is to update the aging NWHC facility to incorporate technological advances in biosafety engineering, building infrastructure, and mechanical systems and to add additional space for enhanced animal care and research. The NWHC needs modernized facilities with sufficient space and modern technologies to support its mission of providing essential national research. The existing facilities require ongoing maintenance and replacement of aging building mechanical systems to maintain current operations. Studies indicate that continuing to maintain and update the current facility to meet the mission and function of the NWHC is cost prohibitive and not effective.
The NWHC needs facilities that provide functional space for administration and operations and meet
On September 5, 2023, the USGS initiated the NEPA process for the proposed action with publication in the
The USGS hosted an in-person public scoping meeting in Madison, Wisconsin, on September 21, 2023, and a virtual scoping meeting on September 28, 2023. On June 14, 2024, the draft EIS notice of availability was published in the
Throughout the NEPA process, the USGS invited Federal, State, county, and local agencies; federally recognized Tribes; officials; organizations; and the public to participate in the public involvement process. The USGS also published information about how to participate during public comment periods in the Wisconsin State Journal and Capital Times, posted information on the project website, and emailed such information to all elected and appointed officials; Federal, State, county, and local agencies; federally recognized Tribes; organizations; and individuals on the project contact list. Additionally, USGS committed to an expansive public outreach process that included engagement with the local community to gain insight into community context.
Alternatives considered in the EIS were identified by the USGS during previous studies, internal evaluations, and the public scoping process. The preliminary alternatives were refined based on information gained through the public scoping process. The preferred alternative in the EIS is the development of a new NWHC on the existing property in Madison, Wisconsin. The EIS also considered the no action alternative, under which no updates would be completed to the existing facilities and no new facilities would be developed. Other alternatives identified during internal and public scoping were considered as outlined in section 2.2 of the final EIS and eliminated because they did not substantially meet the purpose of, and need for, the proposed action.
The USGS decided to implement the preferred alternative, development of a new NWHC on the existing NWHC property in Madison, Wisconsin, as identified in the EIS. This selection was based on the following detailed in the EIS:
• Consultations with Federal, State of Wisconsin, county, and local agencies; Tribes, public officials, organizations, and the public;
• Consideration of potential environmental consequences;
• Need for modernized facilities with sufficient space and modern technologies to support the NWHC's mission of providing essential national research;
• Public comments on received for the draft and final EISs; and
• Material and information contained in previous planning and technical studies.
Development of the new NWHC in Madison, Wisconsin, is contingent on the availability of funding sufficient to proceed.
Bureau of Indian Affairs, Interior.
Notice.
The Department of the Interior (Department) gives notice that the group known as the Salyersville Indian Community has filed a documented petition for Federal acknowledgment as an American Indian Tribe with the Assistant Secretary—Indian Affairs. The Department seeks comment and evidence from the public on the petition.
Comments and evidence must be postmarked by January 28, 2026.
Copies of the narrative portion of the documented petition, as submitted by the petitioner (with any redactions appropriate under 25 CFR 83.21(b)), and other information are available at the Office of Federal Acknowledgement's (OFA) website:
Ms. Nikki Bass, OFA Director, Office of the Assistant Secretary—Indian Affairs, Department of the Interior, by phone: (202) 513-7650; or by email:
On July 31, 2015, the Department's revisions to 25 CFR part 83 became final and effective (80 FR 37861). A key goal of the revisions was to improve transparency through increased notice of petitions and providing improved public access to petitions. Today the Department informs the public that a complete documented petition has been submitted under the current regulations, that portions of that petition are publicly available on the website identified above for easy access, and that we are seeking public comment early in the process on this petition.
Under 25 CFR 83.22(b)(1), the OFA publishes notice that the following group has filed a documented petition for Federal acknowledgment as an American Indian Tribe to the Assistant Secretary—Indian Affairs: Salyersville Indian Community. The contact information for the petitioner is Ms. Joleena Pesenti, P.O. Box 1359, East Jordan, Michigan 49727.
Also, under 25 CFR 83.22(b)(1), OFA publishes on its website the following:
i. The narrative portion of the documented petition, as submitted by the petitioner (with any redactions appropriate under 25 CFR 83.21(b));
ii. The name, location, and mailing address of the petitioner and other information to identify the entity;
iii. The date of receipt;
iv. The opportunity for individuals and entities to submit comments and evidence supporting or opposing the petitioner's request for acknowledgment within 120 days of the date of the website posting; and
v. The opportunity for individuals and entities to request to be kept informed of general actions regarding a specific petitioner.
The Department publishes this notice and request for comment in the exercise of authority delegated by the Secretary of the Interior to the Assistant Secretary—Indian Affairs by Department Manual part 209, chapter 8.
Bureau of Indian Affairs, Interior.
Notice.
The Department of the Interior (Department) gives notice that the group known as the Affiliated Ute Citizens of the State of Utah has filed a documented petition for Federal acknowledgment as an American Indian Tribe with the Assistant Secretary—Indian Affairs. The Department seeks comment and evidence from the public on the petition.
Comments and evidence must be postmarked by October 30, 2025.
Copies of the narrative portion of the documented petition, as submitted by the petitioner (with any redactions appropriate under 25 CFR 83.21(b)), and other information are available at the Office of Federal Acknowledgement's (OFA) website:
Ms. Nikki Bass, OFA Director, Office of the Assistant Secretary—Indian Affairs, Department of the Interior, by phone: (202) 513-7650; or by email:
On July 31, 2015, the Department's revisions to 25 CFR part 83 became final and effective (80 FR 37861). A key goal of the revisions was to improve transparency through increased notice of petitions and providing improved public access to petitions. Today the Department informs the public that a complete documented petition has been submitted under the current regulations, that portions of that petition are publicly available on the website identified above for easy access, and that we are seeking public comment early in the process on this petition.
Under 25 CFR 83.22(b)(1), the OFA publishes notice that the following group has filed a documented petition for Federal acknowledgment as an American Indian Tribe to the Assistant Secretary—Indian Affairs: Affiliated Ute Citizens of the State of Utah. The contact information for the petitioner is Ms. Dora Van, P.O. Box 836, Fort Duchesne, UT 84026.
Also, under 25 CFR 83.22(b)(1), OFA publishes on its website the following:
i. The narrative portion of the documented petition, as submitted by the petitioner (with any redactions appropriate under 25 CFR 83.21(b));
ii. The name, location, and mailing address of the petitioner and other information to identify the entity;
iii. The date of receipt;
iv. The opportunity for individuals and entities to submit comments and evidence supporting or opposing the petitioner's request for acknowledgment within 120 days of the date of the website posting; and
v. The opportunity for individuals and entities to request to be kept informed of general actions regarding a specific petitioner.
The Department publishes this notice and request for comment in the exercise of authority delegated by the Secretary of the Interior to the Assistant Secretary—Indian Affairs by Department Manual part 209, chapter 8.
Office of the Secretary, Interior.
Notice of information collection; request for comment.
In accordance with the Paperwork Reduction Act of 1995, we, the Office of the Secretary, are proposing to revise an information collection.
Interested persons are invited to submit comments on or before October 30, 2025.
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to
Jeffrey Parrillo, Departmental ICCO, 1849 C Street, NW Washington, DC 20240; by telephone at 202-208-7072, or by email to
In accordance with the Paperwork Reduction Act (PRA, 44 U.S.C. 3501
On May 27, 2025, we published in the
As part of our continuing effort to reduce paperwork and respondent burdens, we invite the public and other Federal agencies to comment on new, proposed, revised, and continuing collections of information. This helps us assess the impact of our information collection requirements and minimize the public's reporting burden. It also helps the public understand our information collection requirements and provide the requested data in the desired format.
We are especially interested in public comment addressing the following:
(1) Whether or not the collection of information is necessary for the proper performance of the functions of the agency, including whether or not the information will have practical utility;
(2) The accuracy of our estimate of the burden for this collection of information, including the validity of the methodology and assumptions used;
(3) Ways to enhance the quality, utility, and clarity of the information to be collected; and
(4) How might the agency minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
Comments that you submit in response to this notice are a matter of public record. We will include or summarize each comment in our request to OMB to approve this ICR. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
• Need for a unified Federal policy for the collection, storage, and preservation of fossils.
• Need for standards that would maximize the availability of fossils for scientific study.
• Effectiveness of current methods for storing and preserving fossils collected from Federal lands.
During the course of preparing the report, the agencies held a public meeting to gather public input. The DOI report to Congress, “Assessment of Fossil Management of Federal and Indian Lands,” was published in May 2000. After the report was released, the Paleontological Resources Preservation Act (PRPA) was introduced in the 107th Congress. PRPA was modeled after the Archaeological Resources Protection Act (ARPA) and emphasized the recommendations and guiding principles in the May 2000 report. The legislation was reintroduced in subsequent Congresses through the 111th Congress when it was included as a subtitle in the Omnibus Public Land Management Act, which became law on March 30, 2009. Legislative history demonstrates that PRPA (16 U.S.C. 470aaa-aaa-11) was enacted to preserve paleontological resources for current and future generations because these resources are nonrenewable and are an irreplaceable part of America's heritage. PRPA requires that implementation be coordinated between the Secretaries of the Interior and Agriculture and that DOI and USDA-FS issue regulations as appropriate to carry out the law.
Accordingly, DOI and USDA-FS formed an interagency coordination team in April 2009 to draft the proposed regulations. Members of the team included program leads for paleontology, archaeology, and regulatory specialists from the Bureau of Land Management (BLM), the National Park Service (NPS), the Bureau of Reclamation (BOR), the U.S. Fish and Wildlife Service (USFWS) (the bureaus), and the USDA-FS.
Information collected under this control number includes the following:
(1)
a. Applicant's name, affiliation, and contact information.
b. Description of the applicant's qualifications, to include a current resume for the applicant and all other persons who will oversee fieldwork and other work, and information on the applicant's past performance on previous permits.
c. Maps and other location information, and estimated start and end dates of proposed work.
d. Description, purpose and methodology of proposed work, including a detailed scope of work or research plan for the proposed activity, logistical information, methods that will be employed to explore for or remove the paleontological resources, proposed content and nature of any collection to be made under the permit.
e. Information about the proposed repository.
f. Description of anticipated costs, including bonding information.
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
a. The reasons for challenging the final assessment;
b. The relief sought and the basis for the relief;
c. A copy of the original notice of civil violation and proposed civil penalty assessment;
d. A copy of any objection and supporting documentation filed under 43 CFR 49.515(a) & (b);
e. A copy of the final assessment of civil penalty; and
f. A certificate of service acknowledging service of the request for hearing with the accompanying documentation on the Office of the Solicitor.
With this submission, we propose to revise the following currently approved information collections:
(1)
a. Provide state or administrative area (
b. Is the proposed work identified as hazardous? (Yes/No) For example, work in caves, with helicopters, or using high angle rigging or ropes. This will allow bureau offices to learn if an applicant's proposed work might be identified as hazardous to either the applicant or the public.
c. RAPTOR account creation. This field will provide electronic access to the BLM Recreation And Permit Tracking & Online Reporting (RAPTOR) system. The information will be collected during RAPTOR account creation and then used to autofill all forms. This additional burden hours expended while setting up a RAPTOR account will be offset by the autofill feature of the system. Applicants who are unable to use the RAPTOR system will continue to use the original DI 9002 format.
(2)
(3)
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.
The authority for this action is the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
Bureau of Reclamation, Interior.
Notice of information collection; request for comment.
In accordance with the Paperwork Reduction Act of 1995, we, the Bureau of Reclamation (Reclamation) are proposing to renew an information collection.
Interested persons are invited to submit comments on or before December 1, 2025.
Send your comments on this information collection request (ICR) by mail to Ronnie Baca, Asset Management Division, Bureau of Reclamation, P.O. Box 25007, Denver, CO 80225-0007; or by email to
To request additional information about this ICR, contact Ronnie Baca by email at
In accordance with the Paperwork Reduction Act of 1995 (PRA, 44 U.S.C. 3501
As part of our continuing effort to reduce paperwork and respondent burdens, we invite the public and other Federal agencies to comment on new, proposed, revised, and continuing collections of information. This helps us assess the impact of our information collection requirements and minimize the public's reporting burden. It also helps the public understand our information collection requirements and provide the requested data in the desired format.
We are especially interested in public comment addressing the following:
(1) Whether or not the collection of information is necessary for the proper performance of the functions of the agency, including whether or not the information will have practical utility;
(2) The accuracy of our estimate of the burden for this collection of information, including the validity of the methodology and assumptions used;
(3) Ways to enhance the quality, utility, and clarity of the information to be collected; and
(4) How might the agency minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
Comments that you submit in response to this notice are a matter of public record. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
An agency may not conduct or sponsor and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number.
The authority for this action is the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq).
U.S. International Trade Commission.
Notice.
Notice is hereby given that a complaint was filed with the U.S. International Trade Commission on August 4, 2025, under section 337 of the Tariff Act of 1930, as amended, on behalf of Cerence Operating Company of Burlington, Massachusetts. Letters supplementing the complaint were filed on August 25, September 8, and September 11, 2025. The complaint, as supplemented, alleges violations of section 337 based upon the importation into the United States, the sale for importation, and the sale within the United States after importation of certain smart televisions by reason of the infringement of certain claims of U.S. Patent No. 7,840,579 (“the '579 patent”); U.S. Patent No. 7,894,598 (“the '598 patent”); U.S. Patent No. 8,189,810 (“the '810 patent”); and U.S. Patent No. 9,171,541 (“the '541 patent”). The complaint, as supplemented, further alleges that an industry in the United States exists as required by the applicable Federal Statute. The complainant requests that the Commission institute an investigation and, after the investigation, issue a limited exclusion order and cease and desist orders.
The complaint, except for any confidential information contained therein, may be viewed on the Commission's electronic docket (EDIS) at
Pathenia Proctor, The Office of Unfair Import Investigations, U.S. International Trade Commission, telephone (202) 205-2560.
(1) Pursuant to subsection (b) of section 337 of the Tariff Act of 1930, as amended, an investigation be instituted to determine whether there is a violation of subsection (a)(1)(B) of section 337 in the importation into the United States, the sale for importation, or the sale within the United States after importation of certain products identified in paragraph (2) by reason of infringement of one or more of claims 1-59 of the '579 patent; claims 1-29 of the '598 patent; claims 1-23 of the '810 patent; and claims 1-31 of the '541 patent, and whether an industry in the United States exists as required by subsection (a)(2) of section 337;
(2) Pursuant to section 210.10(b)(1) of the Commission's Rules of Practice and Procedure, 19 CFR 210.10(b)(1), the plain language description of the accused products or category of accused products, which defines the scope of the investigation, is “televisions with smart features and functionality”;
(3) For the purpose of the investigation so instituted, the following are hereby named as parties upon which this notice of investigation shall be served:
(a)
(b) The respondents are the following entities alleged to be in violation of section 337, and are the parties upon which the complaint is to be served:
(c) The Office of Unfair Import Investigations, U.S. International Trade Commission, 500 E Street SW, Suite 401, Washington, DC 20436; and
(4) For the investigation so instituted, the Chief Administrative Law Judge, U.S. International Trade Commission, shall designate the presiding Administrative Law Judge.
Responses to the complaint and the notice of investigation must be submitted by the named respondents in accordance with section 210.13 of the Commission's Rules of Practice and Procedure, 19 CFR 210.13. Pursuant to 19 CFR 201.16(e) and 210.13(a), such responses will be considered by the Commission if received not later than 20 days after the date of service by the Commission of the complaint and the notice of investigation. Extensions of time for submitting responses to the complaint and the notice of investigation will not be granted unless good cause therefor is shown.
Failure of a respondent to file a timely response to each allegation in the complaint and in this notice may be deemed to constitute a waiver of the right to appear and contest the allegations of the complaint and this notice, and to authorize the administrative law judge and the Commission, without further notice to the respondent, to find the facts to be as alleged in the complaint and this notice and to enter an initial determination and a final determination containing such findings, and may result in the issuance of an exclusion order or a cease and desist order or both directed against the respondent.
By order of the Commission.
On the basis of the record
Pursuant to section 207.18 of the Commission's rules, the Commission also gives notice of the commencement of the final phase of its investigations. The Commission will issue a final phase notice of scheduling, which will be published in the
On August 12, 2025, Rayonier Advanced Materials, Inc., Jacksonville, Florida and the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO Washington, DC filed petitions with the Commission and Commerce, alleging that an industry in the United States is materially injured or threatened with material injury by reason of subsidized imports of HPDP from Brazil and LTFV imports of HPDP from Brazil and Norway. Accordingly, effective August 12, 2025, the Commission instituted countervailing duty investigation No.701-TA-777 and antidumping duty investigation Nos. 731-TA-1762-1763 (Preliminary).
Notice of the institution of the Commission's investigations and of a public conference to be held in connection therewith was given by posting copies of the notice in the Office of the Secretary, U.S. International Trade Commission, Washington, DC, and by publishing the notice in the
The Commission made these determinations pursuant to §§ 703(a) and 733(a) of the Act (19 U.S.C. 1671b(a) and 1673b(a)). It completed and filed its determinations in these investigations on September 26, 2025. The views of the Commission are contained in USITC Publication 5680 (October 2025), entitled
By order of the Commission.
On June 21, 2024, the Drug Enforcement Administration (DEA or Government) issued an Order to Show Cause (OSC) to Jody Adams, N.P., of Ridgeland, Mississippi (Respondent). Request for Final Agency Action (RFAA), Exhibit (RFAAX) 2, at 1, 5. The OSC proposed the denial of Respondent's application for DEA registration, Control No. W24008696M, alleging that Respondent's registration would be inconsistent with the public interest.
On January 15, 2025, the Government submitted an RFAA requesting that the Agency issue a default final order denying Respondent's application for registration. RFAA, at 4.
Under 21 CFR 1301.43, a registrant entitled to a hearing who fails to file a timely hearing request “within 30 days after the date of receipt of the [OSC] . . . shall be deemed to have waived their right to a hearing and to be in default” unless “good cause” is established for the failure. 21 CFR 1301.43(a) & (c)(1). In the absence of a demonstration of good cause, a registrant who fails to timely file an answer also is “deemed to have waived their right to a hearing and to be in default.” 21 CFR 1301.43(c)(2). Unless excused, a default is deemed to constitute “an admission of the factual allegations of the [OSC].” 21 CFR 1301.43(e).
Here, the OSC notified Respondent that should she request a hearing and file an answer and then fail to appear at the designated hearing, she would be deemed to have waived her right to a hearing and be in default. RFAAX 2, at 3 (citing 21 CFR 1301.43). Respondent timely filed a request for a hearing and an answer; however, on September 10, 2024, Respondent withdrew her hearing request. RFAA, at 2.
Consistent with the intent and purpose of the default provisions, the Agency has determined that a voluntary withdrawal of a hearing request demonstrates a respondent's desire to no longer defend his/her case and contest the allegations of the OSC.
As the Supreme Court stated in
Congress was particularly concerned with the need to prevent the diversion of drugs from legitimate to illicit channels. To effectuate these goals, Congress devised a closed regulatory system making it unlawful to manufacture, distribute, dispense, or possess any controlled substance except in a manner authorized by the CSA . . . . The CSA and its implementing regulations set forth strict requirements regarding registration, labeling and packaging, production quotas, drug security, and recordkeeping.
The CSA requires that “every person who dispenses, or who proposes to dispense, any controlled substance, shall obtain from the [DEA] a registration.” 21 U.S.C. 822(a)(2);
In light of Respondent's default, the factual allegations in the OSC are deemed admitted. 21 CFR 1301.43(e). Accordingly, Respondent admits that between January 18, 2023, and January 29, 2024, she illegally issued three prescriptions for controlled substances without a DEA registration, including two prescriptions for testosterone, a Schedule III controlled substance, and one prescription for pregabalin, a Schedule V controlled substance. RFAAX 2, at 3.
Accordingly, the Agency finds more than substantial record evidence that Respondent issued three prescriptions for controlled substances without a DEA registration.
When the CSA's requirements are not met, the Attorney General “may deny, suspend, or revoke [a] registration if . . . the [registrant's] registration would be `inconsistent with the public interest.' ”
(A) The recommendation of the appropriate State licensing board or professional disciplinary authority.
(B) The applicant's experience in dispensing or conducting research with respect to controlled substances.
(C) The applicant's conviction record under Federal or State laws relating to the manufacture, distribution, or dispensing of controlled substances.
(D) Compliance with applicable State, Federal, or local laws relating to controlled substances.
(E) Such other conduct which may threaten the public health and safety.
21 U.S.C. 823(g)(1)(A-E).
The five factors are considered in the disjunctive.
Moreover, while the Agency is required to consider each of the factors, it “need not make explicit findings as to each one.”
The Government has the burden of proof in this proceeding. 21 CFR 1301.44(d) (granting or denying an application).
While the Agency has considered all the public interest factors of 21 U.S.C. 823(g)(1),
Here, as the Agency found above, and Respondent is deemed to have admitted, that Respondent issued three controlled substance prescriptions without a DEA registration. Accordingly, there is substantial record evidence in support of the Agency's finding that Respondent violated both federal and Mississippi state law, namely 21 U.S.C 822; 21 CFR 1301.11; and 30 Miss. Code R. 2840-1.5. The Agency further finds that after considering the factors of 21 U.S.C. 823(g)(1), Respondent's registration would be “inconsistent with the public interest.” 21 U.S.C. 824(a)(4);
Accordingly, the Government satisfied its
Where, as here, the Government has met the burden of showing that Respondent's registration would be inconsistent with the public interest, the burden shifts to Respondent to show why she can be entrusted with a registration.
Here, Respondent requested a hearing and filed an answer to the OSC but later withdrew her request for a hearing. Thus, there is no record evidence that Respondent takes responsibility, let alone unequivocal responsibility, for the misconduct. Accordingly, she has not convinced the Agency that her future controlled-substance-related actions will comply with the CSA such that she can be entrusted with the responsibilities of a registration.
Further, the interests of specific and general deterrence weigh in favor of denial. Respondent's conduct in this matter concerns the CSA's strict requirements regarding registration and, therefore, goes to the heart of the CSA's “closed regulatory system” specifically designed “to conquer drug abuse and to control the legitimate and illegitimate traffic in controlled substances.”
In sum, Respondent has not offered any credible evidence on the record that rebuts the Government's case for denial of her registration, and Respondent has not demonstrated that she can be entrusted with the responsibility of registration. Accordingly, the Agency will order the denial of Respondent's application for registration.
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 U.S.C. 823(g)(1), I hereby deny the application for a DEA Certificate of Registration, Control No. W24008696M, submitted by Jody Adams, N.P., as well as any other pending application of Jody Adams, N.P., for registration in Mississippi. This Order is effective October 30, 2025.
This document of the Drug Enforcement Administration was signed on September 25, 2025, by Administrator Terrance Cole. That document with the original signature and date is maintained by DEA. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DEA Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of DEA. This administrative process in no way alters the legal effect of this document upon publication in the
On April 21, 2025, the Drug Enforcement Administration (DEA or Government) issued an Order to Show Cause (OSC) to Denise Henderson, M.D., of Woodland, California (Registrant). Request for Final Agency Action (RFAA), Exhibit (RFAAX) 2, at 1, 4. The OSC proposed the revocation of Registrant's Certificate of Registration No. FH2358578, alleging that Registrant's registration should be revoked because Registrant is “currently without authority to . . . handle controlled substances in the State of California, the state in which [she is] registered with DEA.”
The OSC notified Registrant of her right to file a written request for hearing, and that if she failed to file such a request, she would be deemed to have waived her right to a hearing and be in default.
Further, “[i]n the event that a registrant . . . is deemed to be in default . . . DEA may then file a request for final agency action with the Administrator, along with a record to support its request. In such circumstances, the Administrator may enter a default final order pursuant to [21 CFR] 1316.67.”
The Agency finds that, in light of Registrant's default, the factual allegations in the OSC are deemed admitted. According to the OSC, on or about April 30, 2024, Registrant surrendered her California physician and surgeon license. RFAAX 2, at 2. According to California online records, of which the Agency takes official notice,
Pursuant to 21 U.S.C. 824(a)(3), the Attorney General is authorized to suspend or revoke a registration issued under 21 U.S.C. 823 “upon a finding that the registrant . . . has had his State license or registration suspended . . . [or] revoked . . . by competent State authority and is no longer authorized by State law to engage in the . . . dispensing of controlled substances.” With respect to a practitioner, DEA has also long held that the possession of authority to dispense controlled substances under the laws of the state in which a practitioner engages in professional practice is a fundamental condition for obtaining and maintaining a practitioner's registration.
According to California statute, “dispense” means “to deliver a controlled substance to an ultimate user or research subject by or pursuant to the lawful order of a practitioner, including the prescribing, furnishing, packaging, labeling, or compounding necessary to prepare the substance for that delivery.” Cal. Health & Safety Code § 11010 (2024). Further, a “practitioner” means a person “licensed, registered, or otherwise permitted, to distribute, dispense, conduct research with respect to, or administer, a controlled substance in the course of professional practice or research in [the] state.”
Here, the undisputed evidence in the record is that Registrant currently lacks authority to practice medicine in California. As discussed above, a physician must be a licensed practitioner to dispense a controlled substance in California. Thus, because Registrant currently lacks authority to practice medicine in California and, therefore, is not currently authorized to handle controlled substances in California, Registrant is not eligible to maintain a DEA registration in California. Accordingly, the Agency will order that Registrant's DEA registration be revoked.
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 U.S.C. 824(a), I hereby revoke DEA Certificate of Registration No. FH2358578 issued to Denise Henderson, M.D. Further, pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 U.S.C. 823(g)(1), I hereby deny any pending applications of Denise Henderson, M.D., to renew or modify this registration, as well as any other pending application of Denise Henderson, M.D., for additional registration in California. This Order is effective October 30, 2025.
This document of the Drug Enforcement Administration was signed on Septamber 25, 2025, by Administrator Terrance Cole. That document with the original signature and date is maintained by DEA. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DEA Federal Register
Drug Enforcement Administration, Justice.
Notice of application.
Groff NA Hemplex LLC has applied to be registered as an importer of basic class(es) of controlled substance(s). Refer to Supplementary Information listed below for further drug information.
Registered bulk manufacturers of the affected basic class(es), and applicants, therefore, may submit electronic comments on or objections to the issuance of the proposed registration on or before October 30, 2025. Such persons may also file a written request for a hearing on the application on or before October 30, 2025.
The Drug Enforcement Administration requires that all comments be submitted electronically through the Federal eRulemaking Portal, which provides the ability to type short comments directly into the comment field on the web page or attach a file for lengthier comments. Please go to
In accordance with 21 CFR 1301.34(a), this is notice that on August 19, 2025, Groff NA Hemplex LLC, 2218 South Queen Street, York, Pennsylvania 17402, applied to be registered as an importer of the following basic class(es) of controlled substance(s):
The company plans to import listed controlled substances in bulk form to manufacture research grade material for clinical trial studies. Several types of Marihuana Extract compounds are listed under code 7350. No other activities for these drug codes are authorized for this registration.
Approval of permit applications will occur only when the registrant's business activity is consistent with what is authorized under 21 U.S.C. 952(a)(2). Authorization will not extend to the import of Food and Drug Administration-approved or non-approved finished dosage forms for commercial sale.
On November 20, 2024, the Drug Enforcement Administration (DEA or Government) issued an Order to Show Cause (OSC) to David Payne, M.D., of Santa Ana, California (Registrant). Request for Final Agency Action (RFAA), Exhibit (RFAAX) 1, at 1. The OSC proposed the revocation of Registrant's DEA Certificate of Registration, No. BP3113963, alleging that Registrant is “currently without authority to prescribe, administer, dispense, or otherwise handle controlled substances in the State of California, the state in which [he is] registered with DEA” and has been mandatorily excluded from participation in Medicare, Medicaid, and all Federal health care programs pursuant to 42 U.S.C. 1320a-7(a).
The OSC notified Registrant of his right to file a written request for hearing, and that if he failed to file such a request, he would be deemed to have waived his right to a hearing and be in default.
The Agency finds that, in light of Registrant's default, the factual allegations in the OSC are admitted. Accordingly, Registrant is deemed to admit that on or about March 2, 2023, Registrant was convicted of one felony
According to California's online records, of which the Agency takes official notice, Registrant's California medical license remains suspended.
Pursuant to 21 U.S.C. 824(a)(3), the Attorney General is authorized to suspend or revoke a registration issued under 21 U.S.C. 823 “upon a finding that the registrant . . . has had his State license or registration suspended . . . [or] revoked . . . by competent State authority and is no longer authorized by State law to engage in the . . . dispensing of controlled substances.”
With respect to a practitioner, DEA has also long held that the possession of authority to dispense controlled substances under the laws of the state in which a practitioner engages in professional practice is a fundamental condition for obtaining and maintaining a practitioner's registration.
According to California statute, “dispense” means “to deliver a controlled substance to an ultimate user or research subject by or pursuant to the lawful order of a practitioner, including the prescribing, furnishing, packaging, labeling, or compounding necessary to prepare the substance for that delivery.” Cal. Health & Safety Code § 11010 (2024). Further, a “practitioner” means a person “licensed, registered, or otherwise permitted, to distribute, dispense, conduct research with respect to, or administer, a controlled substance in the course of professional practice or research in [the] state.”
Here, the undisputed evidence in the record is that Registrant currently lacks authority to practice medicine in California. As discussed above, a physician must be a licensed practitioner to dispense a controlled substance in California. Thus, because Registrant currently lacks authority to practice medicine in California and, therefore, is not currently authorized to handle controlled substances in California, Registrant is not eligible to obtain or maintain a DEA registration in California. Accordingly, the Agency will order that Registrant's DEA registration in California be revoked.
Registrant is deemed to admit that as a result of Registrant's criminal conviction, the U.S. Department of Health and Human Services, Office of Inspector General (HHS/OIG), mandatorily excluded Registrant, effective May 20, 2024, from participation in Medicare, Medicaid, and all federal health care programs pursuant to 42 U.S.C. 1320a-7(a) for a period of fourteen years. RFAAX 1, at 2.
Pursuant to 21 U.S.C. 824(a)(5), the Attorney General is authorized to suspend or revoke a registration upon finding that the registrant “has been excluded (or directed to be excluded) from participation in a program pursuant to section 1320a-7(a) of Title 42.” The Agency finds substantial record evidence that Registrant has been, and remains, mandatorily excluded from federal health care programs pursuant to 42 U.S.C. 1320a-7(a).
Where, as here, the Government has met its
Here, Registrant failed to request a hearing or answer the allegations contained in the OSC and did not otherwise avail himself of the opportunity to refute the Government's case. Thus, there is no record evidence that Registrant takes responsibility, let alone unequivocal responsibility, for the misconduct. Accordingly, he has not convinced the Agency that his future controlled-substance-related actions will comply with the CSA such that he can be entrusted with the responsibilities of a registration.
Further, the interests of specific and general deterrence weigh in favor of revocation. Registrant's conduct in this matter concerns the CSA's strict requirements regarding registration, and, therefore, goes to the heart of the CSA's “closed regulatory system” specifically designed “to conquer drug abuse and to control the legitimate and illegitimate traffic in controlled substances.”
In sum, Registrant has not offered any credible evidence on the record to rebut the Government's
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 U.S.C. 824(a), I hereby revoke DEA Certificate of Registration No. BP3113963 issued to David Payne, M.D. Further, pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 U.S.C. 823(g)(1), I hereby deny any pending applications of David Payne, M.D., to renew or modify this registration, as well as any other pending application of David Payne, M.D., for additional registration in California. This Order is effective October 30, 2025.
This document of the Drug Enforcement Administration was signed on September 25, 2025, by Administrator Terrance Cole. That document with the original signature and date is maintained by DEA. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DEA Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of DEA. This administrative process in no way alters the legal effect of this document upon publication in the
On August 29, 2024, the Drug Enforcement Administration (DEA or Government) issued two Orders to Show Cause (OSCs) to Henry Emery, M.D. (Registrant). Request for Final Agency Action (RFAA), Exhibit (RFAAX) A, at 1, 3; RFAAX B, at 1, 8. The first OSC proposed the revocation of Registrant's DEA registration, No. FE7195452, in the state of South Carolina, alleging that Registrant is “currently without authority to handle controlled substances in South Carolina, the state in which [he is] registered with DEA.” RFAAX A, at 2 (citing 21 U.S.C. 824(a)(3)).
The second OSC proposed the revocation of Registrant's DEA registration, No. BE7654127, in the state of North Carolina, alleging two grounds: (1) that Registrant is “currently without authority to handle controlled substances in the State of North Carolina,” RFAAX B, at 3 (citing 21 U.S.C. 824(a)(3)); and (2) that Registrant's registration is inconsistent with the public interest. RFAAX B, at 3 (citing 21 U.S.C. 823(g)(1)(B), (D), 824(a)(4)). More specifically, the second OSC alleged that Registrant issued controlled substance prescriptions to five patients “outside the usual course of professional practice and not for a legitimate medical purpose,” in violation of federal law.
On October 28, 2024, the Government submitted an RFAA requesting that the Agency issue a default final order revoking Registrant's registrations. RFAA, at 3.
Under 21 CFR 1301.43, a registrant entitled to a hearing who fails to file a timely hearing request “within 30 days after the date of receipt of the [OSC] . . . shall be deemed to have waived their right to a hearing and to be in default” unless “good cause” is established for the failure. 21 CFR 1301.43(a) and (c)(1). A registrant who has requested a hearing but who fails to timely file an answer also is “deemed to have waived their right to a hearing and to be in default.” 21 CFR 1301.43(c)(2). Unless excused, a default is deemed to constitute “an admission of the factual allegations of the [OSC].” 21 CFR 1301.43(e).
Here, the OSCs notified Registrant of his right to file a written request for a hearing, and that if he failed to file such a request, he would be deemed to have waived his right to a hearing and be in default.
The Agency agrees with the ALJ and finds that Registrant's purported answer did not comply with DEA's regulations,
Registrant is deemed to admit that his South Carolina medical license was temporarily suspended by the South Carolina Board of Medical Examiners on March 14, 2024. RFAAX A, at 2. According to South Carolina online records, of which the Agency takes official notice,
Registrant is also deemed to admit that he entered into an Interim Non-Practice Agreement with the North Carolina Medical Board on December 27, 2023, agreeing to “not practice medicine until such a time as [Registrant] is given permission to do so by the Board President.” RFAAX B, at 3. There is no evidence that Registrant has been given permission to resume the practice of medicine in North Carolina or that the Non-Practice Agreement has been superseded.
Pursuant to 21 U.S.C. 824(a)(3), the Agency may suspend or revoke a registration issued under 21 U.S.C. 823 “upon a finding that the registrant . . . has had his State license or registration suspended . . . [or] revoked . . . by competent State authority and is no longer authorized by State law to engage in the . . . dispensing of controlled substances.” With respect to a practitioner, the Agency has also long held that the possession of authority to dispense controlled substances under the laws of the state in which a practitioner engages in professional practice is a fundamental condition for obtaining and maintaining a practitioner's registration.
According to South Carolina statute, “[e]very person who manufactures, distributes, or dispenses any controlled substance or who proposes to engage in the manufacture, distribution, or dispensing of any controlled substance, shall obtain a registration issued by the Department [of Health and Environmental Control] in accordance with its rules and regulations.” S.C. Code § 44-53-290(a) (2025). To “dispense” means “to deliver a controlled substance to an ultimate user or research subject by or pursuant to the lawful order of a practitioner, including the prescribing, administering, packaging, labeling, or compounding necessary to prepare the substance for the delivery.”
Here, the undisputed evidence in the record is that Registrant currently lacks authority to dispense controlled substances in South Carolina because his South Carolina medical license has been suspended. As discussed above, a physician must be a licensed practitioner to dispense a controlled substance in South Carolina. Thus, because Registrant lacks authority to handle controlled substances in South Carolina, Registrant is not eligible to maintain a DEA registration in South Carolina. Accordingly, the Agency will order that Registrant's DEA registration in South Carolina be revoked.
According to North Carolina statute, “dispense” means “to deliver a controlled substance to an ultimate user or research subject by or pursuant to the lawful order of a practitioner, including the prescribing, administering, packaging, labeling, or compounding necessary to prepare the substance for that delivery.” N.C. Gen. Stat. § 90-87(8) (2025). Further, a “practitioner” means a “physician . . . or other person licensed, registered or otherwise permitted to distribute, dispense, conduct research with respect to or to administer a controlled substance so long as such activity is within the normal course of professional practice or research in this State.”
In Registrant's Interim Non-Practice Agreement with the North Carolina Medical Board, he has agreed to not “practice medicine.” North Carolina statute defines the “practice of medicine” as “[o]ffering or undertaking to prescribe, order, give, or administer any drug or medicine for the use of any other individual” and “[u]sing the designation . . . `physician' . . . .”
Here, the undisputed evidence in the record is that Registrant currently lacks authority to practice medicine in North Carolina. Thus, because Registrant lacks authority to practice medicine in North Carolina and, therefore, is not authorized to handle controlled substances in North Carolina, Registrant is not eligible to maintain a DEA registration in North Carolina.
The second OSC alleges, in addition to loss of state authority, that for approximately eight years, Registrant “issu[ed] prescriptions to five patients for Schedule II through V controlled substances outside the usual course of professional practice and not for a legitimate medical purpose” in violation of federal law. RFAAX B, at 3 (citing 21 CFR 1306.04(a)).
According to CSA regulations, a prescription for a controlled substance is proper only if “issued for a legitimate medical purpose by an individual practitioner acting in the usual course of his professional practice.” 21 CFR 1306.04(a). The Agency must evaluate whether a Registrant's actions are within the “usual course of professional practice” according to North Carolina law, including the applicable North Carolina standard of care.
Here, the Government has not provided Registrant with notice of any state law or expert testimony purporting to espouse what the “usual course of professional practice” is in North Carolina or any standard of care applicable to North Carolina.
Accordingly, the Agency cannot sustain the Government's public interest allegation in the second OSC. The Agency will revoke based solely on the Registrant's lack of state authority in both South Carolina and North Carolina.
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 U.S.C. 824(a), I hereby revoke DEA Certificate of Registration Nos. FE7195452 and BE7654127 issued to Henry Emery, M.D. Further, pursuant to 28 CFR 0.100(b) and the authority vested in me by 21
This document of the Drug Enforcement Administration was signed on September 25, 2025, by Administrator Terrance Cole. That document with the original signature and date is maintained by DEA. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DEA Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of DEA. This administrative process in no way alters the legal effect of this document upon publication in the
Bureau of Justice Statistics, Department of Justice.
30-Day notice.
The Bureau of Justice Statistics (BJS), Department of Justice (DOJ) will be submitting the following information collection request to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act of 1995.
Comments are encouraged and will be accepted for 30 days until October 30, 2025.
If you have comments especially on the estimated public burden or associated response time, suggestions, or need a copy of the proposed information collection instrument with instructions or additional information, please contact Derek Mueller, Statistician, Bureau of Justice Statistics, 999 N Capitol ST NE, 8th Floor, Washington, DC 20531 (email:
The proposed information collection was previously published in the
Written comments and suggestions from the public and affected agencies concerning the proposed collection of information are encouraged. Your comments should address one or more of the following four points:
Written comments and recommendations for this information collection should be submitted within 30 days of the publication of this notice on the following website
DOJ seeks PRA authorization for this information collection for three (3) years. OMB authorization for an ICR cannot be for more than three (3) years without renewal. The DOJ notes that information collection requirements submitted to the OMB for existing ICRs receive a month-to-month extension while they undergo review.
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(a) As of December 31, the number of incarcerated males and females within their custody and under their jurisdiction with maximum sentences of more than one year, one year or less, and unsentenced;
(b) The number of incarcerated individuals housed in privately operated facilities, county or other local authority correctional facilities, or in other state or Federal facilities on December 31;
(c) Prison admission information in the calendar year for the following categories: new court commitments, parole violators, other conditional release violators returned, transfers from other jurisdictions, AWOLs and escapees returned, and returns from appeal and bond;
(d) Prison release information in the calendar year for the following categories: expirations of sentence, commutations, other conditional releases, probations, supervised mandatory releases, paroles, other conditional releases, deaths by cause, AWOLs, escapes, transfers to other jurisdictions, and releases to appeal or bond;
(e) Number of incarcerated individuals under jurisdiction on December 31 by race and Hispanic origin;
(f) Number of incarcerated individuals under physical custody on December 31 classified as non-citizens, U.S. citizens, and unsentenced;
(g) Number of incarcerated individuals under physical custody on December 31 who are citizens of the U.S. with maximum sentences of more
(h) The source of U.S. citizenship data; and
(i) The aggregated rated, operational, and/or design capacities, by sex, of the state/BOP's correctional facilities at year-end.
For the NPS-1B(T) form, five central reporters from the U.S. Territories and Commonwealths of Guam, Puerto Rico, the Northern Mariana Islands, the Virgin Islands, and American Samoa will be asked to provide information for the following categories for the calendar year just ended, and, if available, for the previous calendar year:
(a) As of December 31, the number of incarcerated males and females within their custody and under their jurisdiction with maximum sentences of more than one year, one year or less and unsentenced; and an assessment of the completeness of these counts (complete, partial, or estimated);
(b) The number of incarcerated individuals under jurisdiction on December 31 but in the custody of facilities operated by other jurisdictions' authorities solely to reduce prison overcrowding;
(c) Number of incarcerated individuals under jurisdiction on December 31 by race and Hispanic origin;
(d) The aggregated rated, operational, and/or design capacities, by sex, of the territory's/Commonwealth's correctional facilities at year-end.
The Bureau of Justice Statistics uses this information in published reports and for the U.S. Congress, Executive Office of the President, practitioners, researchers, students, the media, and others interested in criminal justice statistics.
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If additional information is required contact: Darwin Arceo, Department Clearance Officer, United States Department of Justice, Justice Management Division, Enterprise Portfolio Management, Two Constitution Square, 145 N Street NE, 4W-218, Washington, DC 20530.
Office of the Federal Register.
Notice of special procedures.
During an appropriations lapse, the Office of the Federal Register (OFR) publishes documents directly related to the performance of governmental functions necessary to address imminent threats to the safety of human life or protection of property and may publish documents related to funded programs if delaying publication until the end of the appropriations lapse would prevent or significantly damage the execution of funded functions at the agency. The OFR is prohibited by law from publishing any other agency documents, unless the document was received and scheduled for publication before the appropriations lapse began. The OFR does not make case-by-case determinations as to whether certain documents are directly related to activities that qualify for an exemption under the Antideficiency Act. It is the responsibility of the agency submitting a document for publication during an appropriations lapse to provide justification and certify that the document is authorized under the Antideficiency Act.
Liza Davis, Esq., Director of Legal Affairs and Policy, or Mariya Solomiy, Staff Attorney, Office of the Federal Register, National Archives and Records Administration, (202) 741-6030 or
Due to the possibility of a lapse in appropriations and in accordance with the provisions of the Antideficiency Act, Public Law 97-258, as amended (31 U.S.C. 1341), the OFR announces special procedures for agencies transmitting documents for publication in the
During an appropriations lapse, the OFR publishes documents directly related to the performance of governmental functions necessary to address imminent threats to the safety of human life or protection of property and may publish documents related to funded programs if delaying publication until the end of the appropriations lapse would prevent or significantly damage the execution of funded functions at the agency. The OFR is prohibited by law from publishing any other agency documents, unless the document was received and scheduled for publication before the appropriations lapse began. The OFR does not make case-by-case determinations as to whether certain documents are directly related to activities that qualify for an exemption under the Antideficiency Act. It is the responsibility of the agency submitting a document for publication to provide justification and certify that the document is authorized under the Antideficiency Act.
During an appropriations lapse affecting one or more Federal agencies, the OFR remains open to accept and process documents authorized to be published in the daily
• To safeguard human life, protect property, or
• To provide other emergency services consistent with the performance of functions and services exempted under the Antideficiency Act.
• Because delaying publication until the end of the appropriations lapse would prevent or significantly damage the execution of funded functions at the agency.
The OFR may be able to accept documents transmitted for publication if delaying publication would significantly damage the execution of funded functions at the agency.
Under the August 16, 1995 opinion of the Office of Legal Counsel of the Department of Justice (OLC),
In another opinion, issued on December 13, 1995,
At the onset of an appropriations lapse, the OFR may suspend the regular publication schedule to permit a limited number of exempt personnel to process excepted documents. Agency officials will be informed as to the schedule for filing and publishing individual documents.
OFR has posted frequently asked questions and excepted letter templates on the following website, which will be updated as necessary:
National Endowment for the Arts, National Foundation on the Arts and Humanities.
Notice of meeting.
Pursuant to section 10 (a) (2) of the Federal Advisory Committee Act, as amended, notice is hereby given that a meeting of the National Council on the Arts will be held open to the public. Additional sessions will be closed to the public for reasons stated below.
See the
The National Endowment for the Arts, Constitution Center, 400 Seventh Street SW, Washington, DC 20560. Please see
Office of Public Affairs, National Endowment for the Arts, Washington, DC 20506, at
The meeting will take place on October 29 and 30, 2025. The meeting on October 30, 2025, from 11:00 a.m. to 12:00 p.m., will be open to the public. If, in the course of the open session discussion, it becomes necessary for the Council to discuss non-public commercial or financial information of intrinsic value, the Council will go into closed session pursuant to subsection (c)(4) of the Government in the Sunshine Act, 5 U.S.C. 552b, and in accordance with the March 11, 2022 determination of the Chair. Additionally, discussion concerning purely personal information about individuals, such as personal biographical and salary data or medical information, may be conducted by the Council in closed session in accordance with subsection (c)(6) of 5 U.S.C. 552b. The meeting session that occurs on October 29, 2025, will be closed to the public for the aforementioned reasons.
Nuclear Regulatory Commission.
Monthly notice.
Pursuant to section 189a.(2) of the Atomic Energy Act of 1954, as amended (the Act), the U.S. Nuclear Regulatory Commission (NRC) is publishing this regular monthly notice. The Act requires the Commission to publish notice of any amendments issued, or proposed to be issued, and grants the Commission the authority to issue and make immediately effective any amendment to an operating license or combined license, as applicable, upon a determination by the Commission that such amendment involves no significant hazards consideration (NSHC), notwithstanding the pendency before the Commission of a request for a hearing from any person.
Comments must be filed by October 30, 2025. A request for a hearing or petitions for leave to intervene must be filed by December 1, 2025. This monthly notice includes all amendments issued, or proposed to be issued, from August 15, 2025, to September 11, 2025. The last monthly notice was published on September 2, 2025.
You may submit comments by any of the following methods (unless this document describes a different method for submitting comments on a specific subject); however, the NRC encourages electronic comment submission through the Federal rulemaking website.
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For additional direction on obtaining information and submitting comments, see “Obtaining Information and Submitting Comments” in the
Karen Zeleznock, Office of Nuclear Reactor Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-1118; email:
Please refer to Docket ID NRC-2025-1402, facility name, unit number(s), docket number(s), application date, and subject when contacting the NRC about the availability of information for this action. You may obtain publicly available information related to this action by any of the following methods:
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The NRC encourages electronic comment submission through the Federal rulemaking website (
The NRC cautions you not to include identifying or contact information that you do not want to be publicly disclosed in your comment submission. The NRC will post all comment submissions at
If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment into ADAMS.
For the facility-specific amendment requests shown in this notice, the Commission finds that the licensees' analyses provided, consistent with section 50.91 of title 10 of
The Commission is seeking public comments on these proposed determinations. Any comments received within 30 days after the date of publication of this notice will be considered in making any final determinations.
Normally, the Commission will not issue the amendments until the expiration of 60 days after the date of publication of this notice. The Commission may issue any of these
Within 60 days after the date of publication of this notice, any person (petitioner) whose interest may be affected by any of these actions may file a request for a hearing and petition for leave to intervene (petition) with respect to that action. Petitions shall be filed in accordance with the Commission's “Agency Rules of Practice and Procedure” in 10 CFR part 2. Interested persons should consult a current copy of 10 CFR 2.309. If a petition is filed, the Commission or a presiding officer will rule on the petition and, if appropriate, a notice of a hearing will be issued.
Petitions must be filed no later than 60 days from the date of publication of this notice in accordance with the filing instructions in the “Electronic Submissions (E-Filing)” section of this document. Petitions and motions for leave to file new or amended contentions that are filed after the deadline will not be entertained absent a determination by the presiding officer that the filing demonstrates good cause by satisfying the three factors in 10 CFR 2.309(c)(1)(i) through (iii).
If a hearing is requested, and the Commission has not made a final determination on the issue of no significant hazards consideration, the Commission will make a final determination on the issue of no significant hazards consideration, which will serve to establish when the hearing is held. If the final determination is that the amendment request involves no significant hazards consideration, the Commission may issue the amendment and make it immediately effective, notwithstanding the request for a hearing. Any hearing would take place after issuance of the amendment. If the final determination is that the amendment request involves a significant hazards consideration, then any hearing held would take place before the issuance of the amendment unless the Commission finds an imminent danger to the health or safety of the public, in which case it will issue an appropriate order or rule under 10 CFR part 2.
A State, local governmental body, Federally recognized Indian Tribe, or designated agency thereof, may submit a petition to the Commission to participate as a party under 10 CFR 2.309(h) no later than 60 days from the date of publication of this notice. Alternatively, a State, local governmental body, Federally recognized Indian Tribe, or agency thereof may participate as a non-party under 10 CFR 2.315(c).
For information about filing a petition and about participation by a person not a party under 10 CFR 2.315, see ADAMS Accession No. ML20340A053 (
All documents filed in NRC adjudicatory proceedings, including documents filed by an interested State, local governmental body, Federally recognized Indian Tribe, or designated agency thereof that requests to participate under 10 CFR 2.315(c), must be filed in accordance with 10 CFR 2.302. The E-Filing process requires participants to submit and serve all adjudicatory documents over the internet, or in some cases, to mail copies on electronic storage media, unless an exemption permitting an alternative filing method, as further discussed, is granted. Detailed guidance on electronic submissions is located in the “Guidance for Electronic Submissions to the NRC” (ADAMS Accession No. ML13031A056), and on the NRC's public website (
To comply with the procedural requirements of E-Filing, at least 10 days prior to the filing deadline, the participant should contact the Office of the Secretary by email at
Information about applying for a digital ID certificate is available on the NRC's public website at
A person filing electronically using the NRC's adjudicatory E-Filing system may seek assistance by contacting the NRC's Electronic Filing Help Desk through the “Contact Us” link located on the NRC's public website at
Participants who believe that they have good cause for not submitting documents electronically must file an exemption request, in accordance with 10 CFR 2.302(g), with their initial paper filing stating why there is good cause for
Documents submitted in adjudicatory proceedings will appear in the NRC's electronic hearing docket, which is publicly available at
The following table provides the nuclear power plant names, docket numbers, dates of application, ADAMS accession numbers, and locations in the application of the licensees' proposed NSHC determination. For further details with respect to these license amendment applications, see the applications for amendment, publicly available portions of which are available for public inspection in ADAMS. For additional direction on accessing information related to this document, see the “Obtaining Information and Submitting Comments” section of this document.
The following table provides the plant name, docket number, date of application, ADAMS accession number, and location in the application of the licensees' proposed NSHC determinations. For further details with respect to these license amendment applications, see the applications for amendment, which are available for public inspection in ADAMS. For additional direction on accessing information related to this document, see the “Obtaining Information and Submitting Comments” section of this document.
During the period since publication of the last monthly notice, the Commission has issued the following amendments. The Commission has determined for each of these amendments that the application complies with the standards and requirements of the Atomic Energy Act of 1954, as amended (the Act), and the Commission's rules and regulations. The Commission has made appropriate findings as required by the Act and the Commission's rules and regulations in 10 CFR chapter I, which are set forth in the license amendment.
A notice of consideration of issuance of amendment to facility operating license or combined license, as applicable, proposed NSHC determination, and opportunity for a hearing in connection with these actions, were published in the
Unless otherwise indicated, the Commission has determined that these amendments satisfy the criteria for categorical exclusion in accordance with 10 CFR 51.22. Therefore, pursuant to 10 CFR 51.22(b), no environmental impact statement or environmental assessment need be prepared for these amendments. If the Commission has prepared an environmental assessment under the special circumstances provision in 10 CFR 51.22(b) and has made a determination based on that assessment, it is so indicated in the safety evaluation for the amendment.
For further details with respect to each action, see the amendment and associated documents such as the Commission's letter and safety evaluation, which may be obtained using the ADAMS accession numbers indicated in the following table. The safety evaluation will provide the ADAMS accession numbers for the application for amendment and the
Since publication of the last monthly notice, the Commission has issued the following amendments. The Commission has determined for these amendments that the applications for the amendments comply with the standards and requirements of the Atomic Energy Act of 1954, as amended (the Act), and the Commission's rules and regulations. The Commission has made appropriate findings as required by the Act and the Commission's rules and regulations in 10 CFR chapter I, which are set forth in the license amendments.
Because of exigent circumstances or an emergency situation associated with the date the amendment was needed, there was not time for the Commission to publish, for public comment before issuance, its usual notice of consideration of issuance of amendment, proposed NSHC determination, and opportunity for a hearing.
In circumstances where failure to act in a timely way would have resulted, for example, in derating or shutdown of a nuclear power plant or in prevention of either resumption of operation or of increase in power output up to the plant's licensed power level (an emergency situation), the Commission may not have had an opportunity to provide for public comment on its NSHC determination. In such case, the license amendment has been issued without opportunity for comment prior to issuance. Nonetheless, the State has been consulted by telephone whenever possible.
Under its regulations, the Commission may issue and make an amendment immediately effective, notwithstanding the pendency before it of a request for a hearing from any person, in advance of the holding and completion of any required hearing, where it has determined that NSHC is involved. The Commission has applied the standards of 10 CFR 50.92 and has made a final determination that the amendments involve NSHC. The basis for this determination is contained in the NRC staff safety evaluation related to each action. Accordingly, the amendment has been issued and made effective as indicated.
For those amendments that involve an emergency situation, the Commission is now providing an opportunity to comment on the final NSHC determination for each action; comments should be submitted in accordance with Section I of this notice within 30 days of the date of this notice. Any comments received within 30 days of the date of publication this notice will be considered.
For those amendments that have not been previously noticed in the
Unless otherwise indicated, the Commission has determined that the amendment satisfies the criteria for categorical exclusion in accordance with 10 CFR 51.22. Therefore, pursuant to 10 CFR 51.22(b), no environmental impact statement or environmental assessment need be prepared for this amendment. If the Commission has prepared an environmental assessment under the special circumstances provision in 10 CFR 51.12(b) and has made a determination based on that assessment, it is so indicated in the safety evaluation for the amendment.
For further details with respect to these actions, see the amendment and associated documents such as the Commission's letter and safety evaluation, which may be obtained using the ADAMS accession numbers indicated in the following table. The safety evaluation will provide the ADAMS accession number(s) for the application for amendment and the
For the Nuclear Regulatory Commission.
Postal Regulatory Commission.
Notice.
The Commission is noticing a recent Postal Service filing for the Commission's consideration concerning a negotiated service agreement. This notice informs the public of the filing, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
David A. Trissell, General Counsel, at 202-789-6820.
Pursuant to 39 CFR 3041.405, the Commission gives notice that the Postal Service filed request(s) for the Commission to consider matters related to Competitive negotiated service agreement(s). The request(s) may propose the addition of a negotiated service agreement from the Competitive product list or the modification of an existing product currently appearing on the Competitive product list.
The public portions of the Postal Service's request(s) can be accessed via the Commission's website (
Section II identifies the docket number(s) associated with each Postal Service request, if any, that will be reviewed in a public proceeding as defined by 39 CFR 3010.101(p), the title of each such request, the request's acceptance date, and the authority cited by the Postal Service for each request. For each such request, the Commission appoints an officer of the Commission to represent the interests of the general public in the proceeding, pursuant to 39 U.S.C. 505 and 39 CFR 3000.114 (Public Representative). The Public Representative does not represent any individual person, entity or particular point of view, and, when Commission attorneys are appointed, no attorney-client relationship is established. Section II also establishes comment deadline(s) pertaining to each such request.
The Commission invites comments on whether the Postal Service's request(s) identified in Section II, if any, are consistent with the policies of title 39. Applicable statutory and regulatory requirements include 39 U.S.C. 3632, 39 U.S.C. 3633, 39 U.S.C. 3642, 39 CFR part 3035, and 39 CFR part 3041. Comment deadline(s) for each such request, if any, appear in Section II.
Section III identifies the docket number(s) associated with each Postal Service request, if any, to add a standardized distinct product to the Competitive product list or to amend a standardized distinct product, the title of each such request, the request's acceptance date, and the authority cited by the Postal Service for each request. Standardized distinct products are negotiated service agreements that are variations of one or more Competitive products, and for which financial models, minimum rates, and classification criteria have undergone advance Commission review.
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None. See Section II for public proceedings.
This Notice will be published in the
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange proposes to adopt connectivity fees for cross-connects at the Primary and Disaster Recovery facilities. The Exchange also proposes to adopt connectivity fees for Logical Connectivity (Primary), effective September 29, 2025. The proposed rule change is available on the Exchange's website at
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.
The Exchange is proposing to establish monthly connectivity fees. In advance of the Exchange's commencement of operations as a national securities exchange, the Exchange determined it was reasonable and appropriate to charge market participants for their connectivity to the Exchange.
The Exchange proposes to offer to both Members
Monthly network connectivity fees for Members and non-Members for connectivity will be assessed in any month the Member or non-Member is credentialed to use any of the 24X Application Programming Interfaces in the Primary facility or Disaster Recovery facility.
The Exchange proposes to establish a $500 fee for Primary Logical Connectivity sessions. These application sessions, commonly known as ports, are utilized to perform a particular function on the Exchange, such as order entry or order cancellation, receipt of drop copies, or proprietary market data dissemination. All market participants (Members and non-Members) will be charged per session per month.
As illustrated in the following table, the Exchange has sought to make its connectivity fees consistent with, and in some cases lower than, those of other exchanges,
The Exchange believes that this level of diligence and transparency is called for by the requirements of Section 19(b)(1) under the Act
The Exchange believes that the proposed rule change is consistent with the provisions of Section 6(b)
The Exchange believes that the proposed fees for connectivity services to 24X are reasonable, equitable, not unfairly discriminatory, and otherwise consistent with the Act because, as described above, they are consistent with, and in some cases lower than, the connectivity fees charged by other exchanges,
In addition, the proposed fees will help to encourage connectivity services usage in a way that aligns with the Exchange's regulatory obligations. As a national securities exchange, the Exchange is subject to Regulation Systems Compliance and Integrity (“Reg SCI”).
In conclusion, the Exchange submits that its proposed fee structure satisfies the requirements of Sections 6(b)(4) and 6(b)(5) of the Act
In accordance with Section 6(b)(8) of the Act,
The Exchange does not believe that the proposed rule change to establish connectivity fees would place certain market participants at the Exchange at a relative disadvantage compared to other market participants because the proposed connectivity pricing is associated with relative usage of the Exchange by each market participant and does not impose a barrier to entry to smaller participants. The Exchange believes its proposed pricing is reasonable considering what other exchanges charge and, when coupled with the availability of third-party providers that also offer connectivity solutions, that participation on the Exchange is affordable for all market participants, including smaller trading firms. As described above, the connectivity services purchased by market participants typically increase based on their additional message traffic and the complexity of their operations. The market participants that utilize more connectivity services typically utilize the most bandwidth, and those are the participants that consume the most resources from the network. Accordingly, the proposed fees for connectivity services do not favor certain categories of market participants in a manner that would impose a burden on competition; rather, the allocation of the proposed fees for connectivity reflects the network resources consumed by the various sizes of market participants.
The Exchange does not believe the proposed connectivity fees place an undue burden on competition on other SROs that is not necessary or appropriate. In particular, the proposed fees are comparable to and in some cases lower than fees charged by other exchanges for the same or similar services.
No written comments were solicited or received with respect to the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
Cboe EDGX Exchange, Inc. (“EDGX” or the “Exchange”) proposes to update Rule 13.4(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the operation of the 24X National Exchange LLC (“24X Exchange”) as a registered national securities exchange
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to update Rule 13.4(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the operation of the 24X Exchange as a registered national securities exchange.
On November 27, 2024, the Commission approved 24X Exchange's application to register as a national securities exchange.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,
The Exchange believes that its proposal to update Exchange Rule 13.4(a) to include 24X Exchange will ensure that the Rule publicly states on a market-by-market basis all of the specific network processor and proprietary data feeds that the Exchange utilizes for the handling, routing, and execution of orders, and for performing the regulatory compliance checks related to each of those functions. The proposed rule change also removes impediments to and perfects the mechanism of a free and open market and protects investors and the public interest because it provides additional specificity, clarity and transparency.
The Exchange believes its proposed rule change would not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, the Exchange believes the proposal would enhance competition because including all of the exchanges enhances transparency and enables investors to better assess the quality of the Exchange's execution and routing services.
The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from Members or other interested parties.
Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act
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 will institute proceedings to determine whether the proposed rule change should be approved or disapproved.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 the (“Exchange Act” or “Act”),
This proposed rule change would amend OCC's By-Laws and Rules to remove the numerical designation of the paragraphs in those Articles of the By-Laws and Sections of the Rules that list definitions, in favor of maintaining the paragraphs in alphabetical order.
OCC filed proposed amendments to OCC's current By-Laws and Rules as Exhibit 5A and 5B to File No. SR-OCC-2025-014, respectively. However, OCC has received approval for proposed rule changes with future implementation dates that touch on the sections proposed to be amended here.
In its filing with the Commission, OCC included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. OCC has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of these statements.
As a self-regulatory organization (“SRO”) that is registered as a covered clearing agency (“CCA”) under the Securities Exchange Act of 1934 (“Exchange Act”), as amended,
OCC believes that removing the numbering will enable the more efficient maintenance of the By-Laws and Rules.
In connection with the removal of the paragraph numbering, OCC would also amend cross-references to those definitions that reference the paragraph numbering in the By-Laws,
The changes in Exhibits 5A, 5B, and 5E would become effective upon OCC's receipt of all necessary regulatory approval. Notwithstanding the immediate effectiveness of those changes, OCC would not implement changes to the rule changes in Exhibits 5C and 5D that OCC filed in connection with the implementation of Ovation, until the implementation of the related changes approved in File Nos. SR-OCC-2024-011 and SR-OCC-2024-013.
OCC believes the proposed rule changes are consistent with Section 17A of the Exchange Act and the rules and regulations thereunder. Section 17A(b)(3)(F)
Rule 17ad-22(e)(1) requires OCC to establish, implement, maintain and enforce written policies and procedures reasonably designed to provide for a well-founded, clear, transparent and enforceable legal basis for each aspect of its activities in all relevant jurisdictions. As discussed above, the proposed rule change updates OCC By-Laws and Rules to remove unnecessary numbering used throughout the definition sections and make other minor non-substantive changes intended to improve the clarity and transparency of OCC's By-Laws and Rule. These changes would ensure that OCC's By-Laws and Rules continue to provide a well-founded, clear, transparent, and enforceable legal framework. For those reasons, OCC believes that the proposal is consistent with Rule 17ad-22(e)(1).
Section 17A(b)(3)(I) of the Exchange Act requires that the rules of a clearing agency not impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Exchange Act. As discussed above, the proposed changes would remove unnecessary numbering by reorganizing the definition sections in alphabetical order and make non-substantive revisions and corrections. These proposed changes are technical in nature and would have no impact on the rights or obligations of Clearing Members or other participants in a way that would benefit or disadvantage any one participant over another. Accordingly, OCC does not believe that the proposed corrections to its By-Laws and Rules have any impact or would impose any burden on competition.
Written comments were not and are not intended to be solicited with respect to the proposed rule change, and none have been received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
The proposal shall not take effect until all regulatory actions required with respect to the proposal are completed.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-OCC-2025-014 and should be submitted on or before October 21, 2025.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to change the manner in which the shares of the 7RCC Spot Bitcoin and Carbon Credit Futures ETF (the “Fund”) are listed and traded on the Exchange. The proposed rule change is available on the Exchange's website at
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,
The Exchange proposes to change the manner in which the shares of the Fund (“Shares”) are listed and traded on the Exchange. The Shares were originally approved to list and trade on the Exchange pursuant to Rule 8.500-E. The Exchange now proposes to list and trade Shares of the Fund on the Exchange pursuant to Rule 8.201-E (Generic).
The Commission approved the listing and trading of shares of the Fund (the “Shares”) on the Exchange under Rule 8.500-E on November 15, 2024.
On September 17, 2025, the Commission approved a proposed rule change to adopt Rule 8.201-E (Generic).
The Exchange proposes to now list and trade the Shares of the Fund pursuant to the generic listing standards set forth in Rule 8.201-E (Generic), which would permit the Fund to operate in reliance on the generic listing standards in Rule 8.201-E (Generic) instead of the terms of the Original Approval Order. The Exchange represents that the Shares will meet the requirements of Rule 8.201-E (Generic) on an initial and continued listing basis. In addition, the Exchange will comply with the requirements of Rule 19b-4(e) to list and trade Shares of the Fund on the Exchange.
The Exchange believes the proposed rule change is consistent with the Act and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b)
The Exchange believes the proposed rule change is designed to remove impediments to and perfect the mechanism of a free and open market and, in general, to protect investors and the public interest because it would allow the Fund to be listed and traded under Rule 8.201-E (Generic) instead of Rule 8.500-E. The proposed change would permit the Fund to operate in reliance on the generic listing standards in Rule 8.201-E (Generic) instead of the terms of the Original Approval Order, thereby facilitating the listing and trading of an exchange-traded product that will enhance competition among market participants, to the benefit of investors and the marketplace. The Exchange represents that the Shares will meet the requirements of Rule 8.201-E (Generic) on an initial and continued listing basis.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Act. As discussed above, the proposed change is intended to facilitate the initial and continued listing and trading of the Shares on the Exchange, thereby promoting competition among exchange-traded products to the benefit of investors and the marketplace.
No written comments were solicited or received with respect to the proposed rule change.
Because the foregoing proposed rule change does not:
(i) significantly affect the protection of investors or the public interest;
(ii) impose any significant burden on competition; and
(iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to amend various port fees in the Connectivity Fee Schedule. The proposed rule change is available on the Exchange's website at
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.
The Exchange proposes to amend the Connectivity Fee Schedule to make changes to the monthly recurring fees that Users
The Exchange currently provides ports (also referred to as “connections” and “network access”) to Users in the colocation halls of the MDC at the prices shown below. With this proposal, the Exchange proposes to increase its monthly recurring fees for these ports by amounts between 9.1% to 11.1% (the initial port charges would not change). As proposed, Users would be charged the following adjusted prices:
The proposed port fee increases would enable the Exchange to maintain and improve its market technology and services to remain competitive with its peers. Over the years, customer demand for more sophisticated, higher-throughput, lower-latency, and higher-power connectivity solutions has increased. The Exchange continues to invest in maintaining, improving, and enhancing its connectivity products, services, and facilities for the benefit and often at the behest of its customers. Such enhancements include refreshing hardware and expanding the Exchange's existing colocation facility to offer customers additional space and power.
As discussed below, the Exchange proposes to adjust its fees by an industry- and product-specific inflationary measure. It is reasonable and consistent with the Act for the Exchange to recoup its investments, at least in part, by adjusting its fees. Continuing to operate at fees frozen at 2017 levels impacts the Exchange's ability to enhance its offerings and the interests of market participants and investors.
The fee increases the Exchange proposes are based on an industry-specific Producer Price Index (“PPI”), which is a tailored measure of inflation.
For purposes of this proposal, the relevant industry-specific PPI is the Data Processing and Related Services PPI (“Data PPI”), which is an industry net-output PPI that measures the average change in selling prices received by companies that provide data processing services.
The Data PPI was introduced in January 2002 by the Bureau of Labor Statistics (BLS) as part of an ongoing effort to expand Producer Price Index coverage of the services sector of the U.S. economy and is identified as NAICS 518210 in the North American Industry Classification System.
The Exchange believes the Data PPI is an appropriate measure to be considered in the context of the proposed rule change to modify its port fees because the Exchange uses its “own computer systems” and “proprietary software,”
For purposes of this proposed rule change, the Exchange examined the Data PPI value for the period from January 2017 through March 2025 (the last month for which finalized data is available). The Data PPI had a starting value of 109.0 in January 2017 and an ending value of 121.880 in March 2025, an 11.82% increase. This indicates that companies who are also in the data storage and processing business have generally increased prices for a specified service covered under NAICS 518210 by an average of 11.82% during this period. Based on that percentage change, the Exchange proposes to increase its monthly recurring fees for the ports in the colocation halls of the MDC by up to 11.1%—slightly below the Data PPI increase of 11.82%—which reflects an increase covering the entire period since the last price adjustment to these fees was made.
The Exchange further believes the Data PPI is an appropriate measure for purposes of the proposed rule change on the basis that it is a stable metric with limited volatility, unlike other consumer-side inflation metrics. In fact, the Data PPI has not experienced a
The Exchange believes the Data PPI, and significant investments into, and enhanced performance of, the Exchange support the reasonableness of the proposed fee increases.
These proposed fee increases will be immediately effective upon filing. However, the Exchange proposes to delay the operative date of such changes until January 1, 2026, to give sufficient notice to market participants.
The Exchange believes the proposed rule change is consistent with the provisions of Section 6 of the Act,
This belief is based on two factors. First, the current fees do not properly reflect the quality of the services and products, as fees for these ports have been static in nominal terms, and therefore falling in real terms due to inflation. Second, the Exchange believes that investments made in enhancing the capacity and speed of Exchange systems has increased the performance of these ports.
As noted above, the Exchange has not increased any of the fees included in the proposal since 2017 or earlier. However, in the years following the last fee increases, the Exchange has made significant investments in upgrades to its connectivity products, services, and facilities, enhancing the quality of its services. In other words, Exchange customers have greatly benefited, while the Exchange's ability to recoup its investments has been hampered.
Between 2017 and 2025, the inflation rate was 3.51% per year, on average, producing a cumulative inflation rate of 31.79%.
Notwithstanding inflation, as noted above, the Exchange has not increased its fees for the subject services for more than eight years. The proposed fee changes therefore represent a modest increase from the current fees.
The Exchange believes the proposed fee increase is reasonable in light of the Exchange's continued expenditure in maintaining a robust technology ecosystem. Furthermore, the Exchange continues to invest in maintaining and enhancing its connectivity products—for the benefit and often at the behest of its customers and global investors. Such enhancements include refreshing several aspects of the technology ecosystem including software, hardware, and network while introducing new and innovative products and expanded and modernized facilities. The goal of the enhancements discussed above, among other things, is to provide faster, higher-capacity, and more modern connectivity products and services. Accordingly, the Exchange continues to expend resources to innovate and modernize its technology so that it may benefit its members in offering connectivity products and services.
The Exchange believes that the proposed fee increases are equitably allocated and not unfairly discriminatory because they would apply to all market participants that choose to purchase such connectivity products and services from the Exchange. Any participant that chooses to purchase the Exchange's connectivity products and services would be subject to the same Connectivity Fee Schedule, regardless of what type of business they operate or the use they plan to make of the products and services. Additionally, the fee increases would be applied uniformly to market participants without regard to Exchange membership status or the extent of any other business with the Exchange or affiliated entities.
The Exchange also believes that the proposal represents an equitable allocation of reasonable dues, fees, and other charges because Exchange fees have fallen in real terms during the relevant period. Finally, the Exchange believes that the proposed fee changes are not unfairly discriminatory because the fees would be assessed uniformly across all market participants, in the same manner they are today, that voluntarily purchase the Exchange's connectivity products and services, which would remain available for purchase by all market participants.
The Exchange does not believe that the proposed fees will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
No written comments were solicited or received with respect to the proposed rule change.
Pursuant to Section 19(b)(3)(A)(ii) of the Act,
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The proposed rule change would amend Rule 18 (Waiver or Suspension of Rules and Procedures) of the DTC Rules.
In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The proposed rule change would amend Rule 18 (Waiver or Suspension of Rules and Procedures) of the DTC Rules. The Clearing Agencies will each file with the Commission substantively similar proposals to amend their corresponding Waiver Rules. A substantially similar proposal to amend MBSD Rule 33 was already filed with
Specifically, the proposed amendments to DTC Rule 18 would (i) establish “reasonable and appropriate” as the new standard for when an extension, waiver or suspension may occur; (ii) require action under the rule to be in consideration of DTC's obligations as a clearing agency; (iii) exclude the need for a written report where an extension under the rule is for less than eight hours; (iv) be more clear and concise about who may authorize action under the rule; and (v) make technical, ministerial, and other conforming and clarifying changes.
DTC Rule 18 authorizes DTC, in general, to extend, waive, or suspend a DTC Rule or Procedure. Under the current rule, any extension, waiver, or suspension must be (A) necessary or expedient and (B) requires a written report of such extension, waiver, or suspension (other than an extension of time of less than one hour), stating the pertinent facts, the identity of the Person or Persons who authorized such extension, waiver or suspension and the reason such extension, waiver or suspension was deemed necessary or expedient. The report must then be promptly made and filed with DTC's corporate records and available for inspection by any Participant or Pledgee during regular business hours on Business Days.
The proposed changes would harmonize the language, purpose, and governance of DTC Rule 18 with the equivalent Waiver Rule of MBSD Rule 33,
DTC proposes to eliminate the requirement that an extension, waiver, or suspension authorized under DTC Rule 18 must be “necessary or expedient.” Instead, the proposed changes establish “reasonable and appropriate” as the applicable standard, which DTC believes is a clearer and more relevant standard for the actions to be taken under the rule. Moreover, DTC proposes to provide some general guidance as to when the rule may need to be invoked: to prevent, correct, mitigate or otherwise address an event or situation that, if left unaddressed, could result in a failure to satisfy a requirement of the DTC Rules or Procedures. Similarly, the proposed rule change clarifies that such authority may not be used to circumvent DTC's regulatory obligations provided under DTC Rule 38 (Market Disruption and Force Majeure) in the event of a Market Disruption.
In determining whether to exercise the authority provided by the proposed changes to DTC Rule 18, the proposed rule text would require DTC to consider its obligation to facilitate the prompt and accurate clearance and settlement of securities transactions; to safeguard securities and funds which are in its custody or control; and, in general, to protect investors and the public interest. Examples of the types of actions that may be considered reasonable and appropriate include, but are not limited to, temporarily suspending physical securities processing; waiving applicable charges related to processing or submission failures that result from operational constraints; or reversing fees assessed in connection with erroneous activity resulting from misunderstanding of established procedures. Note, though, any extension, waiver or suspension under the proposed changes to DTC Rule 18 could not be a permanent action, nor would the rule permit extension, waiver or suspension of any regulatory obligations of DTC.
DTC also proposes to update the existing written report requirement so that it applies when an extension under the rule is for less than eight hours, rather than the current one-hour requirement. The change from one hour to eight hours not only harmonizes the timing provision with the waiver requirements of the other Clearing Agencies' Waiver Rules, noted above, but it also provides a more reasonable and realistic period for DTC to identify and address an issue that, by its abbreviated nature, should not necessitate the more formal process of documentation via a written report.
Currently, DTC Rule 18 states that action under the rule can be authorized by DTC's Board of Directors, the Chairman of the DTC Board, the President or any Managing Director. To be clearer and more concise about who can authorize action, particularly given changing Board and executive titles, DTC proposes to modify the language to simply state that action can be authorized by the Board of Directors or by any Officer of the Corporation having a rank of Managing Director or higher.
The proposed rule change would make technical, ministerial, and other conforming and clarifying changes, including updating the title of DTC Rule 18 to “Extension, Waiver or Suspension of Rules and Procedures” and correcting missing and defined terms.
This proposed harmonization is important to help ensure that DTC, NSCC and both FICC divisions can reasonably, appropriately, and consistently manage situations that may apply across multiple divisions, Clearing Agencies, or common members.
Section 17A(b)(3)(F) of the Act requires that the rules of the clearing agency be designed,
As described above, the proposed rule change would (i) establish “reasonable and appropriate” as the new standard for when an extension, waiver or suspension may occur; (ii) require action under the rule to be in consideration of DTC's obligations as a clearing agency; (iii) exclude the need for a written report where an extension under the rule is for less than eight hours; (iv) be more clear and concise about who may authorize action under the rule; and (v) make technical, ministerial, and other conforming and clarifying changes.
The proposed rule change would help ensure that DTC is able to respond reasonably, appropriately, and effectively to situations that may require an extension, waiver, or suspension, of a DTC Rule or Procedure. The proposed changes also enable DTC to respond to such situations in the same way that GSD, NSCC, and MBSD can respond under their respective Waiver Rules and
Therefore, by improving the function and clarity of DTC Rule 18, DTC believes the proposed rule change would help to assure the safeguarding of securities and funds which are in the custody or control of DTC or for which it is responsible, consistent with the requirements of the Act, in particular Section 17A(b)(3)(F) of the Act, cited above.
DTC does not believe that the proposed rule change will have any impact or impose any burden on competition because, as described above, the proposed changes would not affect the rights and obligations of DTC Participants. Rather, the proposed changes are limited to clarifying the standard and conditions under which DTC may extend, waive, or suspend the DTC Rules or Procedures, while also making technical and ministerial edits. These proposed changes would not inhibit access to DTC's services or disadvantage or favor any particular Participant in relationship to another Participant. As such, DTC believes the proposed rule change would not have any impact on competition.
DTC has not received or solicited any written comments relating to this proposal. If any written comments are received, DTC will amend this filing to publicly file such comments as an Exhibit 2 to this filing, as required by Form 19b-4 and the General Instructions thereto.
Persons submitting written comments are cautioned that, according to Section IV (Solicitation of Comments) of the Exhibit 1A in the General Instructions to Form 19b-4, the Commission does not edit personal identifying information from comment submissions. Commenters should submit only information that they wish to make available publicly, including their name, email address, and any other identifying information.
All prospective commenters should follow the Commission's instructions on
DTC reserves the right to not respond to any comments received.
Because the foregoing proposed rule change does not:
(i) significantly affect the protection of investors or the public interest;
(ii) impose any significant burden on competition; and
(iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)
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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
Pursuant to the provisions of Section 19(b)(1) under the Act,
Changes to the Fee Schedule pursuant to this proposal are effective upon filing,
The text of the proposed rule change is available at the Exchange's website at
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 these statements may be examined at the places specified in Item IV below. The self-regulatory organization has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to amend the Market Data Fees section of the Fee Schedule to adopt a fee for real-time access to DEEP+, which is currently offered free of charge.
In September 2024 the Exchange filed an immediately effective rule filing with the Commission to amend IEX Rule 11.330 to add DEEP+ and provide that for an initial incentive period DEEP+ would be provided free of charge for all purposes. IEX also modified the Fee Schedule to add DEEP+ to the table of Market Data Fees and to indicate that DEEP+ would be offered free of charge for an initial incentive period.
The Exchange now proposes to amend the Market Data section of the Fee Schedule to adopt a new fee for the DEEP+ real-time market data feed, referred to therein as DEEP+ Feed (Real-Time). As proposed, the Exchange proposes to adopt a monthly fee of $3,500 per month for real-time access to DEEP+ that would cover all uses of the feed, as discussed below. The Exchange is not proposing to adopt any fee for delayed access to DEEP+.
A single fee covering all uses of the market data feed is consistent with the Exchange's current fee structure for its other real-time market data products, which also have single, unitary fees.
In general, the Exchange believes that exchanges, in setting fees of all types, should meet very high standards of transparency to demonstrate why each
The Exchange believes the proposed fee is reasonable when compared with the aggregate fees charged by other exchanges for comparable market data products, notwithstanding that the other exchanges may have different market data product fee structures. More specifically, as described in the Statutory Basis section, the proposed fee is lower than the aggregate fees charged by other exchanges with similar market share as IEX for comparable market data products and materially lower than the fees charged by exchanges with higher market share than IEX for comparable market data products.
The Exchange plans to implement the proposed fee change on October 1, 2025, subject to effectiveness of this proposed rule change, in order to provide an opportunity to Data Subscribers to update their subscriptions to suit their particular market data needs. On July 1, 2025, the Exchange announced the planned implementation of the proposed fee for real-time access to DEEP+ on October 1, 2025, subject to the filing and effectiveness of an SEC rule filing.
IEX believes that the proposed rule change is consistent with the provisions of Section 6 of the Act
The Exchange believes that the proposed fee of $3,500 per month for real-time access to DEEP+ is reasonable because it is less than the fees charged by many other exchanges for comparable market data products and, more specifically, less than the fees charged by other exchanges with similar or lower market share
As described in the Purpose section, the proposed fee for real-time access to DEEP+ would be an all-inclusive access fee with no additional usage fees. Other exchanges charge fees in addition to an access fee or internal distribution fee depending on how the subscriber is using the data, such as for internal trading purposes, external distribution and/or per user fees. As described more fully below, IEX believes that its proposed all-inclusive fee is lower than the aggregate fees charged by other exchanges with similar or lower market share for similar data products notwithstanding the different fee structures used by such other exchanges.
Currently the most prevalent use of DEEP+ is for non-display purposes, such as internal algorithmic trading or operating a trading venue. The Exchange requires Data Subscribers to regularly report their usage of IEX Market Data.
As summarized in the table below, the proposed fee of $3,500 per month would be lower than fees charged by exchanges with similar or lower market share as IEX for non-display usage of their comparable market data feeds. A more detailed discussion of the comparison follows.
The remaining DEEP+ subscribers that do not use the data feed for internal non-display or non-display trading platform purposes are external distributors of the DEEP+ data feed that distribute the data feed in real-time to unaffiliated third-parties, without controlling the entitlement to and display of the data feed.
As summarized in the table below, the proposed fee of $3,500 per month would be within the range of fees charged by exchanges with lower market share than IEX for external distribution of their comparable market data feeds. A more detailed discussion of the comparison follows.
The proposed fee would be lower than the fees charged by NYSE National and NYSE American, which each charge $4,000, comprised of a $2,500 access fee and a $1,500 redistribution fee for such purpose. The proposed fee would be higher than the fees charged for external distribution for comparable market data products by MEMX and MIAX Pearl, both of which have lower market share than IEX. MEMX and MIAX Pearl each charge a single external distribution fee of $2,500 and do not charge an access fee for external distribution.
Based on reporting from the Exchange's current Data Subscribers, as described above, none of the Exchange's Data Subscribers use the real-time DEEP+ data feed solely for display
With respect to external display use, none of the Exchange's current Data Subscribers report that they redistribute real-time DEEP+ to nonaffiliates for display use by such recipients. Any such future redistribution of either the NYSE National or NYSE American comparable data feed would be subject to an access fee, a redistribution fee, plus per user fees for any display use totaling at least $4,000 per month, more than IEX's proposed monthly fee of $3,500.
Moreover, the Exchange believes that display use of an order-by-order market data product such as real-time DEEP+ would typically be accessed from a product of a commercial data vendor, such as Bloomberg or Refinitiv, rather than directly from a national securities exchange for economical reasons, given that display-only usage does not necessarily require direct access to a low-latency data feed.
The Exchange believes that its proposed fee for real-time access to the DEEP+ data feed is reasonable, fair, equitable, and not unfairly discriminatory. The Exchange believes the proposed fee for the market data feed is fair and equitable because it is optional and applies uniformly to all Data Subscribers, irrespective of their relationship with the Exchange (
Moreover, the $3,500 monthly fee would apply equally to all Data Subscribers. The decision to subscribe to real-time access to DEEP+ or any other market data feed offered by IEX is within the control of any particular market participant, and each market participant has the ability to choose the market data product (or combination of products) best suited to its business objectives. Each Data Subscriber would be subject to the same comparatively low fee and can also receive the same data on a 15-minute delayed basis for no fee or a similar data feed (
Accordingly, based on the foregoing analysis, IEX believes that the proposed fee for real-time access to DEEP+ is consistent with the Act.
IEX 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.
The Exchange does not believe that the proposed rule change will result in any burden on intra-market competition that is not necessary or appropriate in furtherance of the purposes of the Act. Use of real-time DEEP+ is optional. As discussed in the Statutory Basis section, each Data Subscriber would be subject to the same comparatively low fee and can also receive the same data on a 15-minute delayed basis for no fee or a similar data feed (
Further, as discussed in the Statutory Basis section, the proposed fee is within the range of fees charged by other exchanges for comparable market data products and less than the fees charged for such products by exchanges with similar or lower market share than IEX. Thus, IEX does not believe that the proposed relatively low fee would operate as a barrier to entry, or impose a significant cost burden, on smaller Members or Data Subscribers.
The Exchange also does not believe that the proposed rule change will impose any burden on inter-market competition that is not necessary or appropriate in furtherance of the purposes of the Act. As discussed in the Statutory Basis section, other exchanges charge higher fees for comparable market data products. Market participants are not required to subscribe to any market data feed. The Exchange does not believe that starting
Written comments were neither solicited nor received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii)
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 under Section 19(b)(2)(B)
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to amend various port fees in the Connectivity Fee Schedule. The proposed rule change is available on the Exchange's website at
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.
The Exchange proposes to amend the Connectivity Fee Schedule to make changes to the monthly recurring fees that Users
The Exchange currently provides ports (also referred to as “connections” and “network access”) to Users in the colocation halls of the MDC at the prices shown below. With this proposal, the Exchange proposes to increase its monthly recurring fees for these ports by amounts between 9.1% to 11.1% (the initial port charges would not change).
The proposed port fee increases would enable the Exchange to maintain and improve its market technology and services to remain competitive with its peers. Over the years, customer demand for more sophisticated, higher-throughput, lower-latency, and higher-power connectivity solutions has increased. The Exchange continues to invest in maintaining, improving, and enhancing its connectivity products, services, and facilities for the benefit and often at the behest of its customers. Such enhancements include refreshing hardware and expanding the Exchange's existing colocation facility to offer customers additional space and power.
As discussed below, the Exchange proposes to adjust its fees by an industry- and product-specific inflationary measure. It is reasonable and consistent with the Act for the Exchange to recoup its investments, at least in part, by adjusting its fees. Continuing to operate at fees frozen at 2017 levels impacts the Exchange's ability to enhance its offerings and the interests of market participants and investors.
The fee increases the Exchange proposes are based on an industry-specific Producer Price Index (“PPI”), which is a tailored measure of inflation.
For purposes of this proposal, the relevant industry-specific PPI is the Data Processing and Related Services PPI (“Data PPI”), which is an industry net-output PPI that measures the average change in selling prices received by companies that provide data processing services.
The Data PPI was introduced in January 2002 by the Bureau of Labor Statistics (BLS) as part of an ongoing effort to expand Producer Price Index coverage of the services sector of the U.S. economy and is identified as NAICS 518210 in the North American Industry Classification System.
The Exchange believes the Data PPI is an appropriate measure to be considered in the context of the proposed rule change to modify its port fees because
For purposes of this proposed rule change, the Exchange examined the Data PPI value for the period from January 2017 through March 2025 (the last month for which finalized data is available). The Data PPI had a starting value of 109.0 in January 2017 and an ending value of 121.880 in March 2025, an 11.82% increase. This indicates that companies who are also in the data storage and processing business have generally increased prices for a specified service covered under NAICS 518210 by an average of 11.82% during this period. Based on that percentage change, the Exchange proposes to increase its monthly recurring fees for the ports in the colocation halls of the MDC by up to 11.1%—slightly below the Data PPI increase of 11.82%—which reflects an increase covering the entire period since the last price adjustment to these fees was made.
The Exchange further believes the Data PPI is an appropriate measure for purposes of the proposed rule change on the basis that it is a stable metric with limited volatility, unlike other consumer-side inflation metrics. In fact, the Data PPI has not experienced a greater than 3.00% increase for any one calendar year period since 2004, the earliest Data PPI is available. The average calendar year change from 2004 to 2025 was 0.76%, with a cumulative increase of 17.15% over this 21-year period. The Exchange believes the Data PPI is considerably less volatile than other inflation metrics such as CPI, which has had individual calendar-year increases averaging 2.62%, and a cumulative increase of 71.53% during the same period.
The Exchange believes the Data PPI, and significant investments into, and enhanced performance of, the Exchange support the reasonableness of the proposed fee increases.
These proposed fee increases will be immediately effective upon filing. However, the Exchange proposes to delay the operative date of such changes until January 1, 2026, to give sufficient notice to market participants.
The Exchange believes the proposed rule change is consistent with the provisions of Section 6 of the Act,
This belief is based on two factors. First, the current fees do not properly reflect the quality of the services and products, as fees for these ports have been static in nominal terms, and therefore falling in real terms due to inflation. Second, the Exchange believes that investments made in enhancing the capacity and speed of Exchange systems has increased the performance of these ports.
As noted above, the Exchange has not increased any of the fees included in the proposal since 2017 or earlier. However, in the years following the last fee increases, the Exchange has made significant investments in upgrades to its connectivity products, services, and facilities, enhancing the quality of its services. In other words, Exchange customers have greatly benefited, while the Exchange's ability to recoup its investments has been hampered.
Between 2017 and 2025, the inflation rate was 3.51% per year, on average, producing a cumulative inflation rate of 31.79%.
Notwithstanding inflation, as noted above, the Exchange has not increased its fees for the subject services for more than eight years. The proposed fee changes therefore represent a modest increase from the current fees.
The Exchange believes the proposed fee increase is reasonable in light of the Exchange's continued expenditure in maintaining a robust technology ecosystem. Furthermore, the Exchange continues to invest in maintaining and enhancing its connectivity products—for the benefit and often at the behest of its customers and global investors. Such enhancements include refreshing several aspects of the technology ecosystem including software, hardware, and network while introducing new and innovative products and expanded and modernized facilities. The goal of the enhancements discussed above, among other things, is to provide faster, higher-capacity, and more modern connectivity products and services. Accordingly, the Exchange continues to expend resources to innovate and modernize its technology so that it may benefit its members in offering connectivity products and services.
The Exchange believes that the proposed fee increases are equitably allocated and not unfairly discriminatory because they would apply to all market participants that choose to purchase such connectivity products and services from the Exchange. Any participant that chooses to purchase the Exchange's connectivity products and services would be subject to the same Connectivity Fee Schedule, regardless of what type of business they operate or the use they plan to make of the products and services. Additionally, the fee increases would be applied uniformly to market participants without regard to Exchange membership status or the extent of any other business with the Exchange or affiliated entities.
The Exchange also believes that the proposal represents an equitable allocation of reasonable dues, fees, and other charges because Exchange fees have fallen in real terms during the relevant period. Finally, the Exchange believes that the proposed fee changes are not unfairly discriminatory because the fees would be assessed uniformly across all market participants, in the same manner they are today, that voluntarily purchase the Exchange's connectivity products and services, which would remain available for purchase by all market participants.
The Exchange does not believe that the proposed fees will impose any burden on competition that is not
No written comments were solicited or received with respect to the proposed rule change.
Pursuant to Section 19(b)(3)(A)(ii) of the Act,
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Securities and Exchange Commission (“Commission” or “SEC”).
Notice.
Notice of an application under section 6(c) of the Investment Company Act of 1940 (the “Act”) for an exemption from sections 18(a)(2), 18(c) and 18(i) of the Act, under sections 6(c) and 23(c) of the Act for an exemption from rule 23c-3 under the Act, and for an order pursuant to section 17(d) of the Act and rule 17d-1 under the Act.
The Commission:
Trace W. Rakestraw, Senior Special Counsel, at (202) 551-6825 (Division of Investment Management, Chief Counsel's Office).
For Applicants' representations, legal analysis, and conditions, please refer to Applicants' application, dated August 29, 2025, which may be obtained via the Commission's website by searching for the file number at the top of this document, or for an Applicant using the Company name search field on the SEC's EDGAR system. The SEC's EDGAR system may be searched at
For the Commission, by the Division of Investment Management, under delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to amend the fees for Nasdaq 100® Index options
While the changes proposed herein are effective upon filing, the Exchange has designated the amendments become operative on October 1, 2025.
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to amend the fees for the Nasdaq 100® Index (“NDX”)
As set forth in Options 7, Section 5, the Exchange currently charges all Non-Priority Customer
At this time, the Exchange proposes to increase the Priority Customer pricing in NDX and NDXP from $0.25 to $0.50 per contract for simple orders. The Exchange is not proposing to amend its
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The Exchange believes that its proposal to increase the Priority Customer pricing in NDX and NDXP from $0.25 to $0.50 per contract for simple executions is reasonable because Priority Customers will continue to be assessed a lower fee as compared to Non-Priority Customers. While the Exchange is increasing the fee, the Exchange believes that a Priority Customer fee of $0.50 per contract for simple executions will continue to attract order flow to the Exchange. The Exchange notes that market participants are offered different ways to gain exposure to the Nasdaq 100 Index, whether through the Exchange's proprietary products like options overlying NDX or XND, or separately through multi-listed options overlying Invesco QQQ Trust (“QQQ”).
The Exchange believes that its proposal is equitable and not unfairly discriminatory because it will be applied uniformly to all Priority Customers. Assessing lower fees to Priority Customers as compared to Non-Priority Customers is equitable and not unfairly discriminatory because Priority Customers liquidity benefits all market participants by providing more trading opportunities, which attracts market makers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants, to the benefit of all market participants who may interact with the order flow.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
In terms of intra-market competition, the Exchange believes that its proposal does not impose an undue burden on competition because it will be applied uniformly to all Priority Customers. Assessing lower fees to Priority Customers as compared to Non-Priority Customers does not impose an undue burden on competition because Priority Customers liquidity benefits all market participants by providing more trading opportunities, which attracts market makers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants, to the benefit of all market participants who may interact with the order flow.
In terms of inter-market competition, the Exchange 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, or rebate opportunities available at other venues to be more favorable. In such an environment, the Exchange must continually adjust its fees to remain competitive with other options exchanges. Because competitors are free to modify their own fees in response, and because market participants may readily adjust their order routing practices, the Exchange believes that the degree to which fee changes in this market may impose any burden on competition is extremely limited. As noted above, market participants are offered an opportunity to transact in NDX, NDXP, or XND, or separately execute options overlying QQQ. Offering these products provides market participants with a variety of choices in selecting the product they desire to use to gain exposure to the Nasdaq 100 Index.
In addition to the Exchange, market participants have alternative options exchanges that they may participate on and direct their order flow, which list proprietary products that compete with NDX and NDXP.
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to amend various port fees in the Connectivity Fee Schedule. The proposed rule change is available on the Exchange's website at
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.
The Exchange proposes to amend the Connectivity Fee Schedule to make changes to the monthly recurring fees that Users
The Exchange currently provides ports (also referred to as “connections” and “network access”) to Users in the colocation halls of the MDC at the prices shown below. With this proposal, the Exchange proposes to increase its monthly recurring fees for these ports by amounts between 9.1% to 11.1% (the initial port charges would not change). As proposed, Users would be charged the following adjusted prices:
The proposed port fee increases would enable the Exchange to maintain and improve its market technology and services to remain competitive with its peers. Over the years, customer demand for more sophisticated, higher-throughput, lower-latency, and higher-power connectivity solutions has increased. The Exchange continues to invest in maintaining, improving, and enhancing its connectivity products, services, and facilities for the benefit and often at the behest of its customers. Such enhancements include refreshing hardware and expanding the Exchange's existing colocation facility to offer customers additional space and power.
As discussed below, the Exchange proposes to adjust its fees by an industry- and product-specific inflationary measure. It is reasonable and consistent with the Act for the Exchange to recoup its investments, at least in part, by adjusting its fees. Continuing to operate at fees frozen at 2017 levels impacts the Exchange's ability to enhance its offerings and the interests of market participants and investors.
The fee increases the Exchange proposes are based on an industry-specific Producer Price Index (“PPI”), which is a tailored measure of inflation.
For purposes of this proposal, the relevant industry-specific PPI is the Data Processing and Related Services PPI (“Data PPI”), which is an industry net-output PPI that measures the average change in selling prices received by companies that provide data processing services.
The Data PPI was introduced in January 2002 by the Bureau of Labor Statistics (BLS) as part of an ongoing effort to expand Producer Price Index coverage of the services sector of the U.S. economy and is identified as NAICS 518210 in the North American Industry Classification System.
For purposes of this proposed rule change, the Exchange examined the Data PPI value for the period from January 2017 through March 2025 (the last month for which finalized data is available). The Data PPI had a starting value of 109.0 in January 2017 and an ending value of 121.880 in March 2025, an 11.82% increase. This indicates that companies who are also in the data storage and processing business have generally increased prices for a specified service covered under NAICS 518210 by an average of 11.82% during this period. Based on that percentage change, the Exchange proposes to increase its monthly recurring fees for the ports in the colocation halls of the MDC by up to 11. 1%—slightly below the Data PPI increase of 11.82%—which reflects an increase covering the entire period since the last price adjustment to these fees was made.
The Exchange further believes the Data PPI is an appropriate measure for purposes of the proposed rule change on the basis that it is a stable metric with limited volatility, unlike other consumer-side inflation metrics. In fact, the Data PPI has not experienced a greater than 3.00% increase for any one calendar year period since 2004, the earliest Data PPI is available. The average calendar year change from 2004 to 2025 was 0.76%, with a cumulative increase of 17.15% over this 21-year period. The Exchange believes the Data PPI is considerably less volatile than other inflation metrics such as CPI, which has had individual calendar-year increases averaging 2.62%, and a cumulative increase of 71.53% during the same period.
The Exchange believes the Data PPI, and significant investments into, and enhanced performance of, the Exchange
These proposed fee increases will be immediately effective upon filing. However, the Exchange proposes to delay the operative date of such changes until January 1, 2026, to give sufficient notice to market participants.
The Exchange believes the proposed rule change is consistent with the provisions of Section 6 of the Act,
This belief is based on two factors. First, the current fees do not properly reflect the quality of the services and products, as fees for these ports have been static in nominal terms, and therefore falling in real terms due to inflation. Second, the Exchange believes that investments made in enhancing the capacity and speed of Exchange systems has increased the performance of these ports.
As noted above, the Exchange has not increased any of the fees included in the proposal since 2017 or earlier. However, in the years following the last fee increases, the Exchange has made significant investments in upgrades to its connectivity products, services, and facilities, enhancing the quality of its services. In other words, Exchange customers have greatly benefited, while the Exchange's ability to recoup its investments has been hampered.
Between 2017 and 2025, the inflation rate was 3.51% per year, on average, producing a cumulative inflation rate of 31.79%.
Notwithstanding inflation, as noted above, the Exchange has not increased its fees for the subject services for more than eight years. The proposed fee changes therefore represent a modest increase from the current fees.
The Exchange believes the proposed fee increase is reasonable in light of the Exchange's continued expenditure in maintaining a robust technology ecosystem. Furthermore, the Exchange continues to invest in maintaining and enhancing its connectivity products—for the benefit and often at the behest of its customers and global investors. Such enhancements include refreshing several aspects of the technology ecosystem including software, hardware, and network while introducing new and innovative products and expanded and modernized facilities. The goal of the enhancements discussed above, among other things, is to provide faster, higher-capacity, and more modern connectivity products and services. Accordingly, the Exchange continues to expend resources to innovate and modernize its technology so that it may benefit its members in offering connectivity products and services.
The Exchange believes that the proposed fee increases are equitably allocated and not unfairly discriminatory because they would apply to all market participants that choose to purchase such connectivity products and services from the Exchange. Any participant that chooses to purchase the Exchange's connectivity products and services would be subject to the same Connectivity Fee Schedule, regardless of what type of business they operate or the use they plan to make of the products and services. Additionally, the fee increases would be applied uniformly to market participants without regard to Exchange membership status or the extent of any other business with the Exchange or affiliated entities.
The Exchange also believes that the proposal represents an equitable allocation of reasonable dues, fees, and other charges because Exchange fees have fallen in real terms during the relevant period. Finally, the Exchange believes that the proposed fee changes are not unfairly discriminatory because the fees would be assessed uniformly across all market participants, in the same manner they are today, that voluntarily purchase the Exchange's connectivity products and services, which would remain available for purchase by all market participants.
The Exchange does not believe that the proposed fees will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
No written comments were solicited or received with respect to the proposed rule change.
Pursuant to Section 19(b)(3)(A)(ii) of the Act,
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-NYSETEX-2025-35. 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 (
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On March 27, 2025, The Nasdaq Stock Market LLC (“Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
On May 28, 2025, pursuant to Section 19(b)(2) of the Act,
Section 19(b)(2) of the Act
The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
The proposed rule change would amend Rule 42 (Suspension of Rules) of the GSD Rules.
In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The proposed rule change would amend Rule 42 (Suspension of Rules) of the GSD Rules. The Clearing Agencies will each file with the Commission substantively similar proposals to amend their corresponding Waiver Rules. A substantially similar proposal to amend MBSD Rule 33 was already filed with the Commission and implemented by FICC; however, some language was unintentionally omitted from the proposed changes in that Initial MBSD Filing, which this proposal would add.
Specifically, the proposed amendments to GSD Rule 42 would (i) establish “reasonable and appropriate” as the new standard for when an extension, waiver or suspension may occur; (ii) require action under the rule to be in consideration of FICC's obligations as a clearing agency; and (iii) make technical, ministerial, and other conforming and clarifying changes. Additionally, the proposed changes would further amend MBSD Rule 33 to add language that covers the “procedures and regulations” of FICC in a paragraph describing the application of the rule's “reasonable and appropriate” standard. The language already existed in other sections of MBSD Rule 33 prior to the Initial MBSD Filing, but the Initial MBSD Filing unintentionally omitted the language from the referenced paragraph.
GSD Rule 42 authorizes FICC, in general, to extend, waive, or suspend a GSD Rule, Procedure, or regulation issued by FICC. Under the current rule, any extension, waiver, or suspension must be (A) necessary or expedient and (B) requires a written report of such extension, waiver, or suspension (other than an extension of time of less than eight hours), stating the pertinent facts, the identity of the person or persons who authorized such extension, waiver or suspension and the reason such extension, waiver or suspension was deemed necessary or expedient. The report must then be promptly made and filed with FICC's records and available for inspection by any Member during regular business hours on Business Days.
The proposed changes would harmonize the language, purpose, and governance of GSD Rule 42 with the equivalent Waiver Rule of MBSD Rule 33,
GSD proposes to eliminate the requirement that an extension, waiver, or suspension authorized under GSD Rule 42 must be “necessary or expedient.” Instead, the proposed changes establish “reasonable and appropriate” as the applicable standard, which FICC believes is a clearer and more relevant standard for the actions to be taken under the rule. Moreover, FICC proposes to provide some general guidance as to when the rule may need to be invoked: to prevent, correct, mitigate or otherwise address an event or situation that, if left unaddressed, could result in a failure to satisfy a requirement of the GSD Rules, Procedures, or regulations issued by FICC. Similarly, the proposed rule change clarifies that such authority may not be used to circumvent FICC's regulatory obligations provided under GSD Rule 50 (Market Disruption and
In determining whether to exercise the authority provided by the proposed changes to GSD Rule 42, the proposed rule text would require FICC to consider its obligation to facilitate the prompt and accurate clearance and settlement of securities transactions; to safeguard securities and funds which are in its custody or control; and, in general, to protect investors and the public interest. Examples of the types of actions that may be considered reasonable and appropriate include, but are not limited to, extension of monthly bill payment that result from operational constraints; waiving certain charges as a result of unusual market activity; extension of funds-only settlement to capture mark-to-market pricing. Note, though, any extension, waiver or suspension under the proposed changes to GSD Rule 42 could not be a permanent action, nor would the rule permit extension, waiver or suspension of any regulatory obligations of FICC.
The proposed rule change would also make technical, ministerial, and other conforming and clarifying changes, including updating the title of GSD Rule 42 to “Extension, Waiver or Suspension of Rules” and correct missing and defined terms.
This proposed harmonization is important to help ensure that DTC, NSCC and both FICC divisions can reasonably, appropriately, and consistently manage situations that may apply across multiple divisions, Clearing Agencies, or common members.
The proposed amendment to MBSD Rule 33 would add language that was unintentionally omitted from the Initial MBSD Filing. Specifically, the amendment would add the phrase “the procedures or any such regulations” to a paragraph describing the application of the rule's “reasonable and appropriate” standard. This addition clarifies that the authority to extend, waive, or suspend under MBSD Rule 33 expressly applies not only to the MBSD Rules but also to FICC Procedures or any regulations issued by FICC.
Although this language was unintentionally omitted from the above reference paragraph, neither it nor the substantive authority it provides are new to MBSD Rule 33, as the language is already reflected in the opening paragraph of the rule, as well as the corresponding Waiver Rules of GSD, DTC and NSCC. Therefore, adding it to the above reference paragraph will simply harmonize MBSD Rule 33 itself, as well as all the Clearing Agencies' Waiver Rules.
Section 17A(b)(3)(F) of the Act requires that the rules of the clearing agency be designed,
As described above, the proposed rule change would amend GSD Rule 42 to (i) establish “reasonable and appropriate” as the new standard for when an extension, waiver or suspension may occur; (ii) require action under the rule to be in consideration of FICC's obligations as a clearing agency; and (iii) make technical, ministerial, and other conforming and clarifying changes. Additionally, the proposed rule change would amend MBSD Rule 33 to add language that was unintentionally omitted from a prior filing.
The proposed rule change would help ensure that FICC is able to respond reasonably, appropriately, and effectively to situations that may require an extension, waiver, or suspension, of a GSD Rule, Procedure, or regulation issued by FICC. The proposed changes also enable GSD to respond to such situations in the same way that DTC, NSCC, and MBSD can respond under their respective Waiver Rules and under the same governance structure. Specifically, replacing the current “necessary or expedient” standard with a clearer and more intuitive “reasonable and appropriate” standard would enhance transparency and consistency of actions taken under the rule. Finally, the proposed technical and confirming changes improve clarity and consistency with the rule. Additionally, the proposed rule change would amend MBSD Rule 33 to add language that was unintentionally omitted from a prior filing.
Therefore, by improving the function and clarity of GSD Rule 42 and MBSD Rule 33, FICC believes the proposed rule change would help to assure the safeguarding of securities and funds which are in the custody or control of FICC or for which it is responsible, consistent with the requirements of the Act, in particular Section 17A(b)(3)(F) of the Act, cited above.
FICC does not believe that the proposed rule change will have any impact or impose any burden on competition because, as described above, the proposed changes would not affect the rights and obligations of the GSD membership. Rather, the proposed changes are limited to clarifying the standard and conditions under which FICC may extend, waive, or suspend GSD's Rules, Procedures, or regulations issued by FICC, while also making technical and ministerial edits. Similarly, the proposed amendment to MBSD Rule 33 would not impact the rights or obligations of MBSD membership but merely adds previously omitted language to harmonize MBSD Rule 33 within itself and with the Waiver Rules of the other Clearing Agencies. These proposed changes would not inhibit access to FICC's services or disadvantage or favor any particular Member in relationship to another Member. As such, FICC believes the proposed rule change would not have any impact on competition.
FICC has not received or solicited any written comments relating to this proposal. If any written comments are received, FICC will amend this filing to publicly file such comments as an Exhibit 2 to this filing, as required by Form 19b-4 and the General Instructions thereto.
Persons submitting written comments are cautioned that, according to Section IV (Solicitation of Comments) of the Exhibit 1A in the General Instructions to Form 19b-4, the Commission does not edit personal identifying information from comment submissions. Commenters should submit only information that they wish to make available publicly, including their name, email address, and any other identifying information.
All prospective commenters should follow the Commission's instructions on
FICC reserves the right to not respond to any comments received.
Because the foregoing proposed rule change does not:
(i) significantly affect the protection of investors or the public interest;
(ii) impose any significant burden on competition; and
(iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)
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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 11A of the Securities Exchange Act of 1934 (“Act”),
The proposed Amendments have been filed by the Participants pursuant to Rule 608(b)(3)(ii) under Regulation NMS
The Commission is publishing this notice to solicit comments on the Amendments from interested persons. Set forth in Sections I and II is the statement of the purpose and summary of the Amendments, along with the information required by Rules 608(a) and 601(a) under the Act, as prepared and submitted by the Participants.
The above-captioned amendments add 24X as a Participant to the Plans.
Not applicable.
Because the amendments constitute “Ministerial Amendments” under both Section IV(b) of the CTA Plan and Section IV(c) under the CQ Plan, the Chair of the Plans' Operating Committee may submit the amendments to the Commission on behalf of the Participants in the Plans. Because the Participants designate the amendments as concerned solely with the administration of the Plans, the amendments become effective upon filing with the Commission.
Not applicable.
The amendments do not impose any burden on competition because they simply add 24X as a Participant to the Plans. 24X has completed the required steps to be added to the Plans.
Not applicable
See Item 3 above.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
6.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed Amendments are consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On September 4, 2025, the Nasdaq Stock Market LLC (“Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Securities and Exchange Commission (“Commission” or “SEC”).
Notice.
Notice of an application under section 6(c) of the Investment Company Act of 1940 (the “Act”) for an exemption from sections 18(a)(2), 18(c),18(i) and 61(a) of the Act.
Applicants request an order to permit certain closed-end investment companies that have elected to be regulated as business development companies to issue multiple classes of shares with varying sales loads and asset-based distribution and/or service fees.
Audax PDB Management Company, LLC and Audax Private Credit Fund, LLC
The application was filed on August 18, 2025 and amended on August 27, 2025.
An order granting the requested relief will be issued unless the Commission orders a hearing. Interested persons may request a hearing on any application by emailing the SEC's Secretary at
The Commission:
Trace W. Rakestraw, Senior Special Counsel, at (202) 551-6825 (Division of Investment Management, Chief Counsel's Office).
For Applicants' representations, legal analysis, and conditions, please refer to Applicants' application, dated August 27, 2025, which may be obtained via the Commission's website by searching for the file number at the top of this document, or for an Applicant using the Company name search field on the SEC's EDGAR system. The SEC's EDGAR system may be searched at
For the Commission, by the Division of Investment Management, under delegated authority.
On June 25, 2025, Cboe BZX Exchange, Inc. (“Exchange” or “BZX”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
On August 25, 2025, pursuant to Section 19(b)(2) of the Act,
As described in more detail in the Notice,
The investment objective of the Trust is to provide capital appreciation.
The Commission is instituting proceedings pursuant to Section 19(b)(2)(B) of the Act
Pursuant to Section 19(b)(2)(B) of the Act,
The Commission asks that commenters address the sufficiency of the Exchange's statements in support of the proposal, which are set forth in the Notice, in addition to any other comments they may wish to submit about the proposed rule change. In particular, the Commission seeks comment on whether the proposal to list and trade Shares of the Trust, which would hold PENGU, Pudgy Penguin NFTs, SOL, and ETH, is designed to prevent fraudulent and manipulative acts and practices or raises any new or novel concerns not previously contemplated by the Commission.
The Commission requests that interested persons provide written submissions of their views, data, and arguments with respect to the issues identified above, as well as any other concerns they may have with the proposal. In particular, the Commission invites the written views of interested persons concerning whether the proposal, as modified by Amendment No. 2, is consistent with Section 6(b)(5) or any other provision of the Act, and the rules and regulations thereunder. Although there do not appear to be any issues relevant to approval or disapproval that would be facilitated by an oral presentation of views, data, and arguments, the Commission will consider, pursuant to Rule 19b-4, any request for an opportunity to make an oral presentation.
Interested persons are invited to submit written data, views, and arguments regarding whether the proposed rule change, as modified by Amendment No. 2, should be approved or disapproved by October 21, 2025. Any person who wishes to file a rebuttal to any other person's submission must file that rebuttal by November 4, 2025.
Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
Cboe EDGA Exchange, Inc. (“EDGA” or the “Exchange”) proposes to update Rule 13.4(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the operation of the 24X National Exchange LLC (“24X Exchange”) as a registered national securities exchange
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to update Rule 13.4(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the operation of the 24X Exchange as a registered national securities exchange.
On November 27, 2024, the Commission approved 24X Exchange's application to register as a national securities exchange.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,
The Exchange believes that its proposal to update Exchange Rule 13.4(a) to include 24X Exchange will ensure that the Rule publicly states on a market-by-market basis all of the specific network processor and proprietary data feeds that the Exchange utilizes for the handling, routing, and execution of orders, and for performing the regulatory compliance checks related to each of those functions. The proposed rule change also removes impediments to and perfects the mechanism of a free and open market and protects investors and the public interest because it provides additional specificity, clarity and transparency.
The Exchange believes its proposed rule change would not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, the Exchange believes the proposal would enhance competition because including all of the exchanges enhances transparency and enables investors to better assess the quality of the Exchange's execution and routing services.
The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from Members or other interested parties.
Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act
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 will institute proceedings to determine whether the proposed rule change should be approved or disapproved.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On September 5, 2025, National Securities Clearing Corporation (“NSCC”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change SR-NSCC-2025-013 (“Proposed Rule Change”) pursuant to Section 19(b) of the Securities Exchange Act of 1934 (“Exchange Act”)
Section 19(b)(2)(i) of the Exchange Act
The 45th day after publication of the Notice of Filing is October 31, 2025. In order to provide the Commission with sufficient time to consider the Proposed Rule Change, the Commission finds that it is appropriate to designate a longer period within which to take action on the Proposed Rule Change and therefore is extending this 45-day time period.
Accordingly, the Commission, pursuant to Section 19(b)(2) of the Exchange Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to revise the hours of operation of the Exchange. Specifically, the Exchange proposes to change the end time of the Post-Market Session to 8 p.m. E.T. rather than 7 p.m. E.T., to correspondingly revise the definition of the 24X Market Session to preserve a one-hour trading pause (the “Trading Pause”),
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.
The Exchange is filing this proposed rule change to revise the hours of operation of the Exchange. Specifically, the Exchange proposes to change the end time of the Post-Market Session to 8 p.m. E.T. rather than 7 p.m. E.T., to correspondingly revise the definition of the 24X Market Session
24X was approved by the Securities and Exchange Commission as a national securities exchange on November 27, 2024
24X, however, will not commence operation of the 24X Market Session until certain requirements are met. Specifically, Rule 1.5(c) requires 24X, prior to commencing operation of the 24X Market Session, to file a proposed rule change, pursuant to Section 19(b) of the Exchange Act and the rules thereunder, to amend its rules confirming that 24X is able to comply with its obligations under the Exchange Act during the 24X Market Session and that the Equity Data Plans
The Exchange proposes to modify its rules to change the end time of the Post-Market Session, change the start time of the 24X Market Session to preserve the Trading Pause, and make other conforming changes. Specifically, the Exchange proposes to amend Rule 1.5(y) (Post-Market Session) so that the Post-Market Session would end at 8 p.m. E.T. instead of 7 p.m. E.T. With this proposal, the Exchange would offer the current timing of the Post-Market Session available on other national securities exchanges.
The proposed revised hours of the Post-Market and 24X Market Sessions would not substantively change the operation of the Exchange and would allow the Exchange to operate for the same number of hours each day as contemplated in the Exchange's existing rules once the 24X Market Session becomes operative in accordance with the requirements described above. In addition, all NMS stocks would continue to be eligible for trading in the proposed revised hours of the Post-Market Session. Moreover, as discussed below, the existing safeguards applicable to the Post-Market Session including, among other things, operational safeguards, availability of consolidated last sale and quotation information, specific disclosures to investors regarding the heightened risks of after-hours trading, and market surveillance capabilities would be applicable to the proposed revised hours of the Post-Market and 24X Market Sessions. For the avoidance of doubt, it should be clear that the 24X Market Session will only become effective consistent with the requirements of Rule 1.5(c).
In addition to the foregoing rule changes, the Exchanges also proposes to correspondingly amend: (i) Rule 11.15(c)(2) (Trading Pauses) to move the start time of the Trading Pause from 7 p.m. E.T. to 8 p.m. E.T.; (ii) Rule 1.5(b) (24X Trading Day) to modify the definition of the 24X Trading Day; (iii) Rule 11.1(a) and (d) (Hours of Trading and Trading Days) to modify the trading rules that describe the hours of operation of the Exchange; and (iv) Rule 11.6(o)(4) (Extended Hours) and (5) (Good-`til Time) to modify the order entry rules that describe the hours of operation of the Exchange. In each case, the Exchange proposes these modifications to conform to the proposed changes to the definitions of the Post-Market and 24X Market Sessions.
The proposed revised trading sessions will operate in the same manner as the current sessions from an operational perspective. All order types eligible for such sessions and order type behaviors will remain unchanged.
The Exchange will submit all quotes and trades that are generated in the proposed revised hours of the Post-Market Session to the consolidated quote and trade systems maintained by the SIPs for public dissemination. Accordingly, once these proposed revised trading hours are operative, quotes and trades will be made available to the investing public in the same manner that quotes are currently made available.
The two SIP Plan Processors—the Securities Industry Automation Corporation and Nasdaq—both currently operate from 4 a.m. E.T. through 8 p.m. E.T.
As noted above, given the potential trading and other risks of Extended Hours Trading, Rule 3.21 prohibits Members from accepting orders for execution during the Pre-Market Session or Post-Market Session without making the specified disclosures in Rule 3.21. The Exchange notes that these customer disclosure requirements would be fully applicable to the proposed revised trading hours of the Post-Market Session and would place the same disclosure obligations on Members.
The Exchange will begin accepting orders for the proposed revised trading hours of the Post-Market Session subject to the operational effectiveness of this proposed rule change.
The Exchange believes the proposed rule change is consistent with the Exchange Act and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
The Exchange believes the proposed rule change would promote just and equitable principles of trade, remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, protect investors and the public interest by allowing investors to trade on the Exchange during the time that they may trade on other national securities exchanges.
The proposed rule change further removes impediments to a free and open market and does not unfairly discriminate among market participants,
Finally, the Exchange believes that applying the current requirements of the Post-Market Session, including order designation, permitted orders, and mandatory customer disclosures, as well as the operational and regulatory safeguards already in place for the current Post-Market Session, to the proposed revised trading hours of the Post-Market Session, would promote just and equitable principles of trade and protect investors and the public interest.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Exchange. As discussed above, the proposal to modify the trading hours of the Post-Market Session is consistent with the rules of other exchanges. As such, the proposed rule change would promote competition by allowing the Exchange to trade during the proposed revised trading hours of the Post-Market Session in the same manner as another national securities exchange currently is permitted to trade during that same time period.
In addition, the Exchange does not believe that the proposed rule change to modify the trading hours for Post-Market Sessions will impose any burden on intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Exchange Act, because all Members of the Exchange will be able, but not be required, to participate during the proposed revised trading hours of the Post-Market Session. All Members of the Exchange may participate in the proposed revised trading hours of the Post-Market Session in the same manner as they would participate in the existing hours of the Post-Market Session using, for example, the same connection lines, message formats, and data feeds that they currently use, thereby eliminating or minimizing any preparation efforts necessary to continue to participate.
Moreover, the Exchange operates in a highly competitive environment in which unaffiliated exchange competitors and new entrants could compete to offer extended hours trading of similar duration, and the proposal would therefore enable the Exchange to compete on a more level playing field with these competitors.
No written comments were solicited or received with respect to the proposed rule change.
Because the proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative prior to 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A)
A proposed rule change filed under Rule 19b-4(f)(6)
At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B)
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Securities and Exchange Commission (“Commission” or “SEC”).
Notice.
Notice of application for an order under sections 17(d) and 57(i) of the Investment Company Act of 1940 (the “Act”) and rule 17d-1 under the Act to permit certain joint transactions otherwise prohibited by sections 17(d) and 57(a)(4) of the Act and rule 17d-1 under the Act.
Applicants request an order to permit certain business development companies (“BDCs”) and closed-end management investment companies to co-invest in portfolio companies with each other and with certain affiliated investment entities.
Axxes Opportunistic Credit Fund, Greywolf Capital Management LP and certain of their affiliated entities as described in Schedule A to the Application.
The application was filed on May 24, 2024, and amended on November 20, 2024, July 22, 2025, and September 25, 2025.
An order granting the requested relief will be issued unless the Commission orders a hearing. Interested persons may request a hearing on any application by emailing the SEC's Secretary at
The Commission:
Adam Large, Senior Special Counsel, Stephan N. Packs, Senior Counsel, or Daniele Marchesani, Assistant Chief Counsel, at (202) 551-6825 (Division of Investment Management, Chief Counsel's Office).
For Applicants' representations, legal analysis, and conditions, please refer to Applicants' Third Amended and Restated Application, dated September 25, 2025, which may be obtained via the Commission's website by searching for the file number at the top of this document, or for an Applicant using the Company name search field, on the SEC's EDGAR system. The SEC's EDGAR system may be searched at
For the Commission, by the Division of Investment Management, under delegated authority.
On August 29, 2025, Fixed Income Clearing Corporation (“FICC”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change SR-FICC-2025-019 (“Proposed Rule Change”) pursuant to Section 19(b) of the Securities Exchange Act of 1934 (“Exchange Act”)
Section 19(b)(2)(i) of the Exchange Act
The 45th day after publication of the Notice of Filing is October 30, 2025. In order to provide the Commission with sufficient time to consider the Proposed Rule Change, the Commission finds that it is appropriate to designate a longer period within which to take action on the Proposed Rule Change and therefore is extending this 45-day time period.
Accordingly, the Commission, pursuant to Section 19(b)(2) of the Exchange Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Cboe EDGA Exchange, Inc. (the “Exchange” or “EDGA”) is filing with the Securities and Exchange Commission (the “Commission”) a proposed rule change to amend its Fees Schedule to remove obsolete text regarding the assessment of late fees. Specifically, the Exchange proposes to eliminate from its Fee Schedule text indicating that a charge of 1% per month will be assessed on past due portions of Members' accounts and accompanying text describing the terms of the assessment of such late fees. The text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to amend its Fees Schedule to remove obsolete text regarding the assessment of late fees. Specifically, the Exchange proposes to eliminate from its fee schedule text indicating that a charge of 1% per month will be assessed on past due portions of a Member's
By way of background, the Exchange's fee schedule historically included language regarding the assessment of late fees. The Exchange's fee schedule indicated that a 1% per month charge on past due portions of Members' balances would be assessed. Further, the Exchange's fee schedule described the terms of the assessment of such late fees including that the fees would accrue on a daily basis and that the fees would be included as line items on a Member's invoices as they are assessed. Moreover, Exchange Rule 15.1(a) states that the Exchange may prescribe such reasonable dues, fees, assessments or other charges as it may, in the Exchange's discretion, deem appropriate.
The inclusion of late fees on the Exchange's fee schedule was originally intended to incentivize Members to timely pay invoices.
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the “Act”) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
The Exchange believes that its proposed fee schedule amendment is reasonable because it is designed to align the Exchange's fee schedule with its actual billing practices. As discussed above, the Exchange does not assess late fees on a Member's accounts. Because the proposed amendment aligns the Exchange's fee schedule with the services currently provided by the Exchange by removing obsolete language and eliminating (rather than adding) a fee from its fee schedule, the Exchange believes the proposed amendment is reasonable.
The Exchange believes the proposal to remove language regarding the assessment of late fees from its fee schedule is equitable and not unfairly discriminatory because it applies uniformly to all Members of the exchange and all market participants will have further clarity as to whether the Exchange assesses late fees. The proposed amendment to eliminate language relating to the assessment late fees applies equally to all of the Exchange's Members and other persons using or seeking to use its facilities. As such, the proposed amendment is non-discriminatory. Additionally, the Exchange believes that by eliminating language regarding the assessment of late fees, the proposed amendment will promote market transparency by accurately reflecting the Exchange's current policy regarding the assessment of late fees. The Exchange also believes the proposed amendment will provide clarity to its Members and other market participants by accurately describing the manner in which the Exchange assesses fees. As such, the Exchange believes the proposed rule amendment is equitable.
The Exchange notes that it is not statutorily required to assess late fees on the past due balances of its Members. The Exchange seeks to align the language in its fee schedule with the current billing practices of the Exchange. The Exchange believes that Members would benefit from clear guidance in its fee schedule that accurately describes the manner in which the Exchange assesses fees. The proposed fee schedule amendment is intended to make the fee schedule clearer and less confusing for Members and eliminate potential confusion, thereby removing impediments to and perfecting the mechanism of a free and open market and a national market system, and, in general, protecting investors and the public interest.
The Exchange does not believe that the proposed amendment will impose any burden on intramarket or intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed amendment will impose any burden on intramarket competition because the proposed change applies uniformly to all market participants.
As discussed above, the proposed amendment seeks to align the Exchange's fee schedule with the current practices of the Exchange. The Exchange does not believe that the proposed amendment will impose any burden on intermarket competition because the Exchanges current practices regarding the assessment of late fees is similar to practices of other exchanges. Based on a review of other exchanges' fee schedules, the Exchange is currently unaware of any late fees or charges assessed by competitor exchanges such as NASDAQ Stock Market LLC (“NASDAQ”) and MIAX Pearl LLC (“MIAX). Like the Exchange, NASDAQ and MIAX retain the ability to prescribe reasonable dues, fees, assessments or other charges as they may deem appropriate.
Additionally, the Exchange does not believe that the proposed amendment creates an undue burden on competition because the Exchange will continue to assess all other fees upon its Members as described in its fee schedule and Rulebook. Further, the Exchange is currently unaware of any late fees or charges assessed by competitor exchanges such as NASDAQ and MIAX. Accordingly, the Exchange does not believe its proposed fee schedule amendment imposes any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On April 8, 2025, Cboe BZX Exchange, Inc. (“BZX”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
On June 4, 2025, pursuant to Section 19(b)(2) of the Act,
Section 19(b)(2) of the Act
The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change, and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
date by which the Commission shall either approve or disapprove the proposed rule change (File No. SR-CboeBZX-2025-053).
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
Cboe EDGA Exchange, Inc. (the “Exchange” or “EDGA”) proposes to introduce a Small Retail Broker Hosted Solutions Program and to update the existing eligibility requirements for the Small Retail Brokerage Distribution Program for the Cboe One Summary Feed. The text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the Exchange's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set
The Exchange proposes to adopt a Small Retail Broker Hosted Solutions Program (the “Program”) for EDGX Top Data and Cboe One Summary Data (collectively, the “Applicable Feeds”).
Further, the Exchange proposes to increase the allowed maximum Non-Professional Data User subscriber count for the existing Small Retail Broker Program for Cboe One Summary Feed and EDGX Top Data Feed. By way of background, the Exchange currently offers the EDGX Top Data Feed, which is a data feed that offers top-of-book quotations and last sale information based on orders entered into the Exchange's System. The EDGX Top Data Feed benefits investors by facilitating their prompt access to real-time top-of-book information contained in EDGX Top Data. The Exchange's affiliated equities exchanges (
Currently, the Exchange offers a Small Retail Broker Distribution Program
The Exchange now proposes to create a new Program based on the proposed eligibility criteria for Small Retail Brokers to specifically support Small Retail Brokers who are operating platforms on behalf of other Small Retail Brokers. Based on customer feedback, there are Small Retail Brokers who would like to provide this data via a hosted solution as a White Label Service
Of further note, the Hosting Small Retail Broker Distributor is responsible for reporting its External Hosted Subscribers and their users, and ultimately the Hosting Small Retail Broker Distributor is responsible for payment of all data fees for both its External Subscribed Subscriber and itself. While the Exchange is not privy to pass-through costs between Hosting Small Retail Broker Distributors and External Hosted Subscribers, this proposed pricing allows Hosting Small Retail Broker Distributors the freedom to charge or not charge External Hosted Subscribers while also appropriately charging for a service provided to an
Additionally, given that External Hosted Subscribers are smaller relative to other Small Retail Brokers currently participating in the existing Small Retail Broker Distribution Program, their ability to subscribe to the Applicable Feeds as Hosting Small Retail Broker Distributors is likely not feasible. Specifically, the costs of the Applicable Feeds may make access to this data impractical. Additionally, the costs associated with building and maintaining the technological infrastructure to receive and disseminate data, may make access to such data impractical. Generally speaking, technology, infrastructure, and connectivity costs are a significant monetary investment and require significant human expertise and resources to maintain. As such, the totality of costs can make access to data difficult. The Exchange believes, though, that the proposed fees and the ability to subscribe to the Applicable Feeds as External Hosted Subscribers will make access to data more feasible. Indeed, the Exchange anticipates that the retail broker-dealers that would seek to become External Hosted Subscribers are broker-dealers that do not have the technological infrastructure in place to ingest and disseminate data as a Hosting Small Retail Broker, and that are likely to have smaller client bases and business models not as conducive to making the investments necessary to become a Hosting Small Retail Broker.
In these regards, the Exchange believes that the proposed program will incentivize Hosting Small Retail Broker Distributors to offer the Applicable Feeds to External Hosted Subscribers, thereby making data accessible to a larger number of broker-dealers and their clients, at an affordable cost. Specifically, under the proposed program, a Hosting Small Retail Broker Distributor providing the data to at least one External Hosted Subscriber would be eligible for a credit of its Distribution Fee (a credit of $750/month for EDGX Top Data Feed and a credit of $3,500/month for Cboe One Summary Feed) that it is normally responsible for under the existing Small Retail Broker Program. Additionally, the External Hosted Subscriber shall also receive a waiver of the Distribution Fee (a credit of $750/month for EDGX Top Data Feed and a credit of $3,500/month for Cboe One Summary Feed). The External Hosted Subscriber will also receive a waiver of the Data Consolidation Fee for the Cboe One Summary Data (a credit of $350/month), and in lieu of paying the Non-Professional User fees, it shall be a set monthly fee of $750 for EDGX Top and $850 for Cboe One Summary Data.
In addition to the changes set forth above, the Exchange also proposes to modify the existing Small Retail Broker Program for Cboe One Summary Feed and EDGX Top Feed to increase the number of Non-Professional Data User maximum from 5,000 to 10,000 to be consistent with the proposed threshold for External Hosted Subscribers. As previously discussed, the Exchange proposes to also use the cap of 10,000 Non-Professional Data Users for the proposed Program. The Exchange proposes to increase this in support of increased participation across both retail and investor markets in order to facilitate the growth of smaller retail brokers on a global scale.
As mentioned above, the existing fee structure makes it costly for both Hosting Small Retail Broker Distributors and its External Hosted Subscribers to provide data to the External Hosted Subscribers' retail clients as Distribution Fees are assessed on both Small Retail Brokers. Overall, the Exchange believes that this fee proposal will help to make its data more widely accessible for retail users who receive their data from External Hosted Subscribers. Specifically, the Exchange believes that that this proposal will (i) further increase the competitiveness of the Exchange's top of book market data products compared to competitor offerings that may currently be cheaper for firms with a limited subscriber base that do not yet have the scale to take advantage of the lower subscriber fees offered by the Exchange; and will (ii) provide additional incentives for Hosting Small Retail Broker Distributors to provide hosted solution services for other Small Retail Brokers in order to make data more widely available to retail investors. In turn, the Exchange believes that this change may benefit market participants and investors by spurring additional competition and increasing the accessibility of the Exchange's top of book data.
The Exchange notes that at least one other exchange has a similar offering. For example, the New York Stock Exchange has a Redistribution Fee Waiver for NYSE Trades, for which redistributors of data may have their redistribution fee waived so long as they provide the data to at least one data feed recipient and reports such data feed recipient or recipients to the Exchange.
Without these discounts, a redistributor of NYSE Trades would pay the General Access Fee of $1,500/month in addition to the Redistribution Fee of $1,000/month and the applicable Professional User Fee ($4/month/User) and Non-Professional User Fee ($0.20/month/User).
While the eligibility requirements of the NYSE program and the proposed Program differ, both programs are intended to incentivize redistribution of applicable data feeds by providing enhanced discounts and both programs target different segments for a specific purpose. The proposed discounts under this Program are intended to make the Exchange's offering competitively priced relative to alternative options that participants may have.
Without the proposed pricing discounts, the Exchange believes that (i) prospective customers may not be interested in purchasing top of book data from the Exchange, and may instead purchase such data from other national securities exchanges or the Securities Information Processors (“SIPs”), potentially at a higher cost than would be available pursuant to the proposed program and (ii) that Hosting Small Retail Broker Distributors are not incentivized to make the Applicable Feeds available via a hosted solution for retail investors of its External Hosted Subscribers. Similar to the existing Small Retail Broker Program, the Exchange believes that the proposed Program will continue to increase competition for such market data, and that enhanced competition could help to further reduce data fees as providers compete for subscribers, as well as help diversify the availability and quality of data offerings available to retail investors through their Hosting Small Retail Broker Distributors. Ultimately, the Exchange believes that it is critical that it be allowed to compete by offering attractive pricing to customers as increasing the availability of such products ensures continued competition with alternative offerings. Such competition may be constrained when competitors are impeded from offering alternative and cost-effective solutions to customers.
The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,
The Exchange also believes that the proposed rule change is consistent with Section 11(A) of the Act.
In adopting Regulation NMS, the Commission granted SROs and broker-dealers increased authority and flexibility to offer new and unique market data to the public. It was believed that this authority would expand the amount of data available to consumers, and also spur innovation and competition for the provision of market data. The Exchange believes that the proposed fee change would further broaden the availability of U.S. equity market data to investors, and in particular retail investors, consistent with the principles of Regulation NMS.
The Exchange operates in a highly competitive environment. Indeed, there are sixteen registered national securities exchanges that trade U.S. equities and offer associated top of book market data products to their customers. The national securities exchanges also compete with the SIPs for market data customers. The Commission has repeatedly expressed its preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. Specifically, in Regulation NMS, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system “has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.”
Making alternative data products available to market participants ultimately ensures increased competition in the marketplace and constrains the ability of exchanges to
The Exchange notes that the Applicable Feeds are distributed and purchased on a voluntary basis, in that neither the Exchange nor market data distributors are required by any rule or regulation to make these data products available. Distributors (including vendors) and Users can therefore discontinue use at any time and for any reason, including due to an assessment of the reasonableness of fees charged. Further, the Exchange is not required to make any proprietary data products available or to offer any specific pricing alternatives to any customers.
The Commission has long stressed the need to ensure that the equities markets are structured in a way that meets the needs of ordinary investors. For example, the Commission's strategic plan for fiscal years 2018-2022 touts “focus on the long-term interests of our Main Street investors” as the Commission's number one strategic goal.
The Exchange notes that the proposed waivers for the Applicable Feeds only apply to Hosting Small Retail Broker Distributors and its External Hosted Subscribers for three reasons. First, the Hosting Small Retail Broker Distributor is creating a full-service offering for External Hosted Subscribers in contrast to the Small Retail Brokers under the current Program, which only provide services directly to its own retail clients. Maintaining an additional platform for External Hosted Subscribers' clients is an additional workstream for the Hosting Small Retail Broker (in contrast to Small Retail Brokers that only provide data and services directly to their retail clients), requiring technological and capital investments, as they seek to support additional ecosystems of business, each with its own book of retail clients. In order to incentivize the Hosting Small Retail Broker Distributors to take on the additional duties associated with hosting External Hosted Subscribers (such as managing the data, entitlements, and display of the application provided to the External Hosted Subscriber), the Exchange believes it is not unfairly discriminatory to provide a waiver of the Distribution Fee for the Hosting Small Retail Broker Distributors, as opposed to the standard discounted Distribution Fee normally paid under the current Small Retail Broker Distribution Program.
Second, by creating this program, the Exchange is further able to reach additional retail investors. By waiving Distribution Fees for both the Hosting Small Retail Broker Distributor and its External Hosted Subscriber, both parties are incentivized to work together to provide data to retail investors. Third, as mentioned previously, the Hosting Small Retail Broker Distributor is responsible for the fees and reporting for both its own activity and that of its External Hosted Subscriber. While the Exchange is not privy to pass-through costs between Hosting Small Retail Broker Distributors and External Hosted Subscribers, this proposed pricing allows Hosting Small Retail Broker Distributors the freedom to charge or not charge External Hosted Subscribers while also appropriately charging for a service provided to an External Hosted Subscriber that is benefitting from an infrastructure developed and supported by the Hosting Small Retail Broker Distributor. The Exchange notes that the current Small Retail Broker Program prevents the Hosting Small Retail Broker Distributor from packaging this waiver as part of their overall service to their External Hosted Subscribers (as External Hosted Subscribers would be billed directly under the existing Small Retail Broker Program). Given that External Hosted Subscribers are smaller relative to other Small Retail Brokers currently participating in the Program, these costs associated with the Applicable Feeds are inherently prohibitive to the External Hosted Subscriber. Through this Program, fees will not be a deterrent for Hosting Small Retail Broker Distributors and External Hosted Subscribers to establish platforms that reach a wider scope of retail investors.
Furthermore, while this Program would be effectively limited to smaller firms in accordance with the proposed eligibility requirements, the Exchange does not believe that this limitation makes the fees inequitable or unfairly discriminatory. The Exchange notes that large broker-dealers and/or vendors that distribute the Exchange's data products to a sizeable number of investors benefit from the current fee structure, which includes lower subscriber fees and Enterprise licenses. Due to lower subscriber fees, distributors that provide the Applicable Feeds to more than the proposed capped amounts of Users permitted under either the Small Retail Broker Program or this Program already enjoy cost savings compared to competitor products. The Program, in addition to the existing Small Retail Broker Distributor Program, would therefore continue to ensure that small retail brokers that distribute top of book data to their retail investor customers could also benefit from reduced pricing, and would aid in increasing the competitiveness of the Exchange's data products for this key segment of the market.
Moreover, the Exchange does not believe that the proposed fees unfairly discriminate between Hosting Small Retail Broker Distributors and External Hosted Subscribers. While the proposal provides additional benefits to External Hosted Subscribers that would not otherwise accrue to them under the current program, the Exchange notes that such benefits are designed only to make access to market data more accessible to smaller retail broker-dealers that either do not possess the financial and technological resources necessary to receive data as a Small Retail Broker, or simply choose not commit such resourced based on their business models. In turn, to continue to incentivize the provision of the Applicable Feed by Hosting Small Retail Broker Distributors, the Exchange has sought to provide appropriate incentives to these brokers as well. Collectively, the fee structure provides benefits to both Hosting Small Retail Broker Distributors and External Hosted Subscribers.
While External Hosted Subscribers would receive benefits they would not accrue under the current program, these are not benefits that today's Small Retail Brokers would choose to avail themselves of under the new fee
Rather, the Exchange believes that the more likely case is that the proposed fee structure will attract a new population of Small Retail Brokers who will seek to access the Applicable Feed as Hosted External Subscribers, at a cost-effective price point, thereby providing even more investors with access to top of book market data for U.S. equities. Another likely use case is that the proposed fee structure may incentivize more Small Retail Brokers to subscribe to the Applicable Feed as External Hosted Subscribers and, as they build their own business models and attract subscribers of their own, eventually commit time and resources to building their own infrastructure to evolve into a Hosting Small Retail Broker.
Furthermore, the Exchange acknowledges that under the proposed fee schedule that a Hosting Small Retail Broker Distributor is eligible for a waiver of its Distribution Fee once its first External Hosted Subscriber is subscribed, whereas under current program a Small Retail Broker is not eligible for such a waiver. However, the Exchange does not believe that this proposed fee structure unfairly discriminates between existing Small Retail Brokers and Hosting Small Retail Brokers, because the application of these fees is based on meaningful differences between existing Small Retail Brokers and potential Hosting Small Retail Broker Distributors.
Specifically, existing Small Retail Brokers are brokers that distribute the Applicable Feed to their own customers. These Small Retail Brokers typically operate their own retail trading businesses, and the provision of the Applicable Feed is part of the package of services provided to their own customers. Comparatively, similar to certain subscribers
Relatedly, the proposed fees are based on the competitive environment for market data products such as the Applicable Feed. In response to competition from other market data feeds such as NYSE BQT, the Exchange's proposed fees are merely intended to provide a financial incentive for vendors/redistributors that do not currently subscribe to any Exchange market data products to subscribe to the Applicable Feed. By focusing on this segment of the market, the Exchange believes that the proposed fees will make the Applicable Feed more competitive and attractive for vendors/redistributors to subscribe to, thereby increasing the availability of the Exchange's data products, expanding the options available to firms making data purchasing decisions on their business needs, and generally increasing competition. In this regard, the Exchange believes that the proposed fees—particularly the waiver of the Distribution Fee—will incentivize Hosting Small Broker Distributors (
Moreover, the Exchange believes that the proposed change to provide a waiver of the Distribution Fee to a Hosting Small Retail Broker Distributor (
Finally, the Exchange notes that nothing in the current proposal prevents an existing Small Retail Broker from choosing to instead subscribe to Applicable Feed as an External Hosted Subscriber. However, the Exchange does not believe that this makes the proposal
The Exchange believes that the proposed cap of 10,000 for the Cboe One Summary Data Feed and EDGX Top Data Feed for this Program, as well as increasing this cap to 10,0000 for the Cboe One Summary Data Feed and EDGX Top Data Feed for the Small Retail Broker Program is reasonable and not unfairly discriminatory as the Exchange believes it is in the best interest of all market participants to more broadly expand this in support of inclusion for more retail investors by participation in both programs by small retail brokers on a global scale.
The Exchange believes that the Distribution Fee Waivers for both the External Hosted Subscriber and the Hosting Small Retail Broker Distributor are reasonable as they represent a significant cost reduction for the Hosting Small Retail Broker Distributor to provide a hosted solution for the External Hosted Subscriber, to ultimately provide the data to the External Hosted Subscriber's retail investors. By targeting the Distribution Fee waiver to vendors/redistributors that provide external distribution of the Applicable Feeds, the Exchange believes that this would provide an incentive for redistributors to make the Applicable Feeds available to its customers. Specifically, if a data recipient is interested in subscribing to the Applicable Feeds and relies on a vendor/redistributor to obtain market data products from the Exchange, that data customer would need the vendor/redistributor to first subscribe to and distribute the Applicable Feeds. In this regard, the Exchange believes the proposed waiver would provide an incentive for vendors/redistributors to make the Applicable Feeds available to their customers, which will increase the availability of the Applicable Feeds to a larger potential population of retail investors.
While the existing fee structure does provide a benefit of a discounted waiver for Small Retail Brokers that externally distribute the data, these discounted Distribution Fees are still incurred by both the External Hosted Subscriber and the Hosting Small Retail Broker Distributor. In an attempt to alleviate these costs, and make this data more available to retail investors, the Exchange proposes to waive the Distribution Fees for both the Hosting Small Retail Broker Distributor and the External Hosted Subscriber. With this Program, the Exchange believes it will increase market accessibility and data to investors on a global scale. Exchange Hosted Subscribers may not have the infrastructure or technical capabilities to offer market data and/or execution services to its retail investors. Through waiving these fees for the External Hosted Subscriber, the Exchange hopes to reach a broader scale of retail investors globally. Further, as discussed above, the Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber and the Hosting Small Retail Broker Distributor given the development and maintenance the Hosting Small Retail Broker Distributor acquires to provide this data to the External Hosted Subscriber's end users.
The Exchange believes it is reasonable to not charge the External Hosted Subscriber the Data Consolidation Fee for Cboe One Summary Data for the duration of the time that they are eligible for this program. As previously discussed, the waiver of fees for the External Hosted Subscriber is intended to make this data more available to retail investors. The Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber because, as described above, the Exchange believes by alleviating some of the barriers to entry, that Exchange Hosted Subscribers are able to bring this data and execution services to their retail investors. Of further note, the Exchange believes it is reasonable to maintain this cost for the Hosting Small Retail Broker Distributor as the Hosting Small Retail Broker Distributor is the party receiving this data from the Exchange where it is consolidated for the benefit of the Hosting Small Retail Broker Distributor.
The Exchange believes it is reasonable to set a fixed cost for Non-Professional Users fees for External Hosted Subscribers by charging a flat, fixed cost instead of charging per user to allow for additional savings. Under this structure, the External Hosted Subscriber shall still be responsible by paying the standard per User fee of a Professional Users under the Applicable Feed. The Exchange does not believe this is unfairly discriminatory as the program is based around making the Applicable Feeds available for Non-Professional Users. The Exchange also notes that it has taken a similar approach here to the NYSE Per User Access Fee, which sets a fixed costs where the data is used only for display purposes.
The Exchange does not believe that the proposed rule change would result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange operates in a highly competitive environment, and its ability to price these data products is constrained by: (i) Competition among exchanges that offer similar data products to their customers; and (ii) the existence of inexpensive real-time consolidated data disseminated by the SIPs. Top of book data is disseminated by both the SIPs and the sixteen equities exchanges. There are therefore a number of alternative products available to market participants and investors. In this competitive environment potential subscribers are free to choose which competing product to purchase to satisfy their need for market information. Often, the choice comes down to price, as broker-dealers or vendors look to purchase the cheapest top of book data product, or quality, as market participants seek to purchase data that represents significant market liquidity. In order to better compete for this segment of the market, the Exchange is proposing to reduce the cost of top of book data provided by Hosting Small Retail Broker Distributors to its External Hosted Subscribers, and in turn, their retail investors. The Exchange believes that this would facilitate greater access to such data, ultimately benefiting the retail investors that are provided access to such market data.
The Exchange also believes the proposed fee changes will better enable it to compete in the Asia Pacific region, which is an area of increasing interest and growth within the U.S. equities markets, generally. As the Asia Pacific investor base seeks access to the liquidity and efficient price discovery processes that exist in the U.S. equities markets, various broker-dealers have begun offering trading in this region, and exchanges have begun to contemplate 24-hour trading solutions designed to capture the increased demand from the Asia Pacific investor base.
The Exchange does not believe that this price reduction would cause any unnecessary or inappropriate burden on intermarket competition as other exchanges and data vendors are free to lower their prices to better compete with the Exchange's offering. Indeed, as explained in the basis section of this proposed rule change, the Exchange's decision to (i) waive the Distribution Fee for the Hosting Small Retail Broker Distributor and the External Hosted Subscriber and (ii) waiving the Consolidation Fee (when applicable) for the External Hosted Subscriber and (iii) setting a fixed cost for the Non-Professional Users for the External Hosted Subscriber is itself a competitive response to different fee structures available on competing markets. The Exchange therefore believes that the proposed rule change is pro-competitive as it seeks to offer pricing incentives to customers to better position the Exchange as it competes to attract additional market data subscribers. The Exchange also believes that the proposed reduction in fees the Hosting Small Retail Broker Distributor and the External Hosted Subscriber would not cause any unnecessary or inappropriate burden on intramarket competition. Although the proposed fee discount would be largely limited to small retail broker subscribers, larger broker-dealers and vendors can already purchase top of book data from the Exchange at prices that represent a significant cost savings when compared to competitor products that combine higher subscriber fees with lower fees for distribution. In light of the benefits already provided to this group of subscribers, the Exchange believes that additional discounts to small retail brokers would increase rather than decrease competition among broker-dealers that participate on the Exchange. Furthermore, as discussed earlier in this proposed rule change, the Exchange believes that offering pricing benefits to brokers that represent retail investors facilitates the Commission's mission of protecting ordinary investors, and is therefore consistent with the Act.
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
Cboe BZX Exchange, Inc. (the “Exchange” or “BZX”) proposes to amend its Fee Schedule to: amend the transaction fee for Customer orders in Penny Program securities that remove liquidity; append fee code PP to all Non-Customer orders (
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange first notes that it operates in a highly competitive market in which market participants can readily direct order flow to competing venues if they deem fee levels at a particular venue to be excessive or incentives to be insufficient. More specifically, the Exchange is only one of 18 options venues to which market participants may direct their order flow. Based on publicly available information, no single options exchange has more than 16% of the market share.
The Exchange's Fee Schedule sets forth standard rebates and rates applied per contract. For example, the Exchange provides a rebate of $0.29 per contract for MM orders that add liquidity in Penny Securities, yielding fee code PM. Additionally, in response to the competitive environment, the Exchange also offers tiered pricing, which provides Members opportunities to qualify for higher rebates or reduced fees where certain volume criteria and thresholds are met. Tiered pricing provides an incremental incentive for Members to strive for higher tier levels, which provides increasingly higher benefits or discounts for satisfying increasingly more stringent criteria.
The Exchange proposes to amend the transaction fee for Customer orders in Penny Program securities that remove liquidity. Currently, Customer orders in Penny Program securities that remove liquidity are assessed a standard transaction fee of $0.45 and yield fee code PC. The Exchange now proposes to increase the fee for Customer orders in Penny Program securities that remove liquidity to $0.48.
Currently, fee code PP assesses a standard transaction fee of $0.50 and is appended to MM/Away MM/Professional
The Exchange currently offers six Customer Penny Add Volume Tiers (“Customer Penny Add Tiers”) under footnote 1 of the Fee Schedule which provide rebates between $0.35 and $0.53 per contract for qualifying Customer orders which meet certain add liquidity thresholds and yield fee code PY.
The Exchange proposes to change the rebates for Tiers 2 through 5 and the Customer Cross-Asset Tier. Specifically, the Exchange proposes to amend the Tier 2 rebate from $0.48 to $0.47, the Tier 3 rebate from $0.51 to $0.49, the Tier 4 rebate from $0.52 to $0.50, the Tier 5 rebate from $0.53 to $0.52, and the Customer Cross-Asset Add Tier from $0.52 to $0.50.
The Exchange also proposes to amend the required criteria for Tiers 2 through 5, as well as the Customer Cross-Asset Add Tier. The required criteria for Tier 1 remains unchanged. Currently, to qualify for Tier 2, a Member must have an ADV
The Exchange currently offers six MM Penny Add Volume Tiers (“MM Penny Add Tiers”) under footnote 6 of the Fee Schedule, which provide rebates between $0.31 and $0.43 per contract for qualifying MM orders which meet certain add liquidity thresholds and yield fee code PM. The Exchange proposes to update the MM Penny Add Tiers by (1) eliminating MM Cross-Asset Tier 2, (2) amending required criteria for Tiers 2 through 4 and MM Cross-Asset Add Tier 1, (3) providing a separate rebate under the program for qualifying SPY orders, (4) amending the current rebate for Tiers 1 through 4 and MM Cross-Asset Add Tier 1, and (5) adopting a new Tier 5.
First, the Exchange proposes to eliminate MM Cross-Asset Tier 2
Next, the Exchange proposes to amend the MM Penny Add Tiers to adopt separate rebates for qualifying MM orders in SPY which meet the add liquidity thresholds and yield fee code PM. Specifically, for qualifying MM orders in SPY which meet the applicable add liquidity thresholds and yield fee code PM, the Exchange proposes to adopt a per contract rebate of $0.33 for Tier 1, $0.36 for Tier 2, $0.38 for Tier 3, $0.42 for Tier 4 and $0.43 for MM Cross-Asset Add Tier 1.
The Exchange proposes to change the rebates for Tiers 1 through 4 and the MM Cross-Asset Tier 1, for qualifying MM orders (excluding SPY) which meet the add liquidity thresholds and yield fee code PM. Specifically, the Exchange proposes to amend the Tier 1 rebate from $0.31 to $0.32, the Tier 2 rebate from $0.38 to $0.35, the Tier 3 rebate from $0.39 to $0.38, the Tier 4 rebate from $0.43 to $0.41, and the MM Cross-Asset Add Tier rebate from $0.38 to $0.42.
Finally, the Exchange proposes to amend the MM Penny Add Tiers to adopt Tier 5. To qualify for proposed MM Penny Add Tier 5, a Member must have an ADAV in MM orders ≥0.50% of average OCV. The Exchange proposes to adopt a Tier 5 rebate of $0.42 per contract for qualifying MM orders excluding SPY and $0.45 per contract for qualifying MM orders in SPY.
The Exchange currently offers three MM Non-Penny Add Volume Tiers (“MM Non-Penny Add Tiers”) under footnote 7 of the Fee Schedule which provide rebates between $0.45 and $0.88 per contract for qualifying MM orders which meet certain add liquidity thresholds and yield fee code NM.
First, the Exchange proposes to update the required criteria for MM Non-Penny Add Tier 1. Currently, to qualify for Tier 1, a Member must have an ADAV in MM orders ≥0.10% of average OCV. The Exchange proposes to
The Exchange further proposes to update the MM Non-Penny Add Tiers by eliminating Tier 3, which provides for a rebate of $0.88 per contract for qualifying MM orders where a Member (1) has an ADAV in MM orders ≥1.00% of average OCV; and has an ADAV in MM Non-Penny orders of ≥0.10% of average OCV.
The Exchange currently offers two Firm, BD, and JBO Penny Add Volume Tiers under footnote 2 of the Fee Schedule which provide rebates between $0.38 and $0.42 per contract for qualifying Customer orders which meet certain add liquidity thresholds and yield fee code PF.
The Exchange proposes to adopt a Customer Penny Take Volume Tier (“Customer Penny Take Tier”), applicable to qualifying Customer orders yielding fee code PC,
The Exchange currently offers three MM, Away MM, and Professional Penny Take Volume Tiers under footnote 3 of the Fee Schedule which provide reduced fees of between $0.49 and $0.47 per contract for qualifying MM, Away MM, and Professional orders which meet certain add/remove liquidity thresholds and yield fee code PP.
The Exchange currently offers four Firm, BD, and JBO Non-Penny Add Volume Tiers under footnote 8 of the Fee Schedule which provide rebates of $0.33 and $0.82 per contract for qualifying Firm, BD, and JBO orders which meet certain add liquidity thresholds and yield fee code NF.
The Exchange currently offers two Away MM Penny Add Volume Tiers (“Away MM Penny Add Tiers”) under footnote 10 of the Fee Schedule which provide rebates of $0.38 and $0.45 per contract (for Tiers 1 and 2 respectively) for qualifying Away MM orders which meet certain add liquidity thresholds and yield fee code PN.
The Exchange currently offers two Away MM Non-Penny Add Volume Tiers (“Away MM Non-Penny Add Tiers”) under footnote 11of the Fee Schedule which provide rebates of $0.40 and $0.52 per contract (for Tiers 1 and 2 respectively) for qualifying Away MM orders which meet certain add liquidity thresholds and yield fee code NN.
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the “Act”) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
As described above, the Exchange operates in a highly competitive market in which market participants can readily direct order flow to competing venues if they deem fee levels at a particular venue to be excessive or incentives to be insufficient. The proposed changes to Exchange execution fees and rebates are intended to attract order flow to the Exchange by continuing to offer competitive pricing while also creating additional incentives to providing aggressively priced displayed liquidity, which the Exchange
The Exchange believes its proposal to increase the standard transaction fee for Customer orders in Penny Program securities that remove liquidity from $0.45 to $0.48 per contract is reasonable because it is a modest increase and is still in line with (and in some instances lower than) fees assessed for similar transactions at other exchanges.
The Exchange believes its proposal to append fee code PP to all Non-Customer orders in Penny Program securities that remove liquidity and to delete fee code PD is reasonable. As noted above, the standard transaction fee for fee code PP will continue to be $0.50 per contract. The Exchange believes it is reasonable to assess $0.50 per contract for Firm/BD/JBO orders (increased from $0.48 per contract under current fee code PD) in Penny Program securities that remove liquidity because it is a modest increase and is still in line with fees assessed for similar transactions at other exchanges.
The Exchange believes the proposal to update the Customer Penny Add Tiers by amending the current rebate for Tiers 2 through 5 and the Customer Cross-Asset Add Tier, and amending required criteria for Tiers 2 through 5 and the Customer Cross-Asset Add Tier is reasonable.
Specifically, the Exchange believes the proposed reduced rebates are reasonable because Members are still eligible to receive a rebate for meeting the corresponding criteria, albeit at a lower amount than before. The revised rebate structure features reduced rates that are counterbalanced by lower qualification thresholds. While, as proposed, the Customer Penny Add Tiers 2 through 5 and the Customer Cross-Asset Add Tier will provide lower rebates than that currently offered, the Exchange still believes that the changes are reasonable as the tiers, even as amended, will continue to incentivize Members to send additional Customer orders to the Exchange. Rebates that are designed to incentivize add activity may provide for deeper, more liquid markets and execution opportunities at improved prices, which ultimately offers additional cost savings, supports the quality of price discovery, promotes market transparency and improves market quality for all investors. Moreover, the Exchange is not required to maintain these tiers nor provide rebates. The Exchange believes the proposed changes to the rebates offered under these tiers still remain commensurate with the corresponding criteria under the respective tiers.
Further, the Exchange believes the proposed changes to the required criteria for Tiers 2 through 5 and the Customer Cross-Asset Add Tier are reasonable because they continue to provide opportunities for Members to receive higher rebates by providing for incrementally increasing volume-based criteria they can reach for. The proposed changes, in general, ease the requirement to achieve applicable tier threshold, which the Exchange believes will continue to serve as a reasonable means to encourage Members to increase their liquidity on the Exchange, particularly in connection with additional Customer order flow to the Exchange, to the benefit of investors.
The Exchange believes the proposed criteria remain commensurate with the corresponding enhanced rebates. The Exchange believes the revised criteria will continue to encourage Members to send additional Customer orders to the Exchange. Rebates that are designed to incentivize add volume order flow may increase transactions on the Exchange, which the Exchange believes incentivizes liquidity providers to submit additional liquidity and execution opportunities. As noted above, an overall increase in activity deepens the Exchange's liquidity pool, offers additional cost savings, supports the quality of price discovery, promotes market transparency and improves market quality for all investors.
Finally, the Exchange believes the proposed changes to the Customer Penny Add Tiers are equitable and not unfairly discriminatory because they apply uniformly to all Members, who will have the opportunity to meet the tiers' criteria and receive the corresponding enhanced rebate for each tier if such criteria is met. Without having a view of activity on other markets and off-exchange venues, the Exchange has no way of knowing whether these proposed changes would definitely result in any Members qualifying for the proposed rebates. While the Exchange has no way of predicting with certainty how the proposed changes will impact Member activity, based on trading activity from the prior months, the Exchange anticipates that up to two Members could achieve Tier 2, up to two Members could achieve Tier 3, up to one Member could achieve Tier 4, up to 2 Members could achieve Tier 5, and up to one Member could achieve the Customer Cross-Asset Add Tier. Additionally, all Members are able to increase their Customer order flow to attempt to achieve these tiers. Should a Member not meet the proposed new criteria, the Member will merely not receive that corresponding enhanced rebate.
The Exchange also believes that it is equitable and not unfairly discriminatory to apply the proposed changes to Customer order flow, as compared to other market participant order flow, because Customer order flow enhances liquidity on the Exchange for
The Exchange believes its proposal to update the MM Penny Add Tiers by eliminating MM Cross-Asset Tier 2, providing a separate rebates under the program for qualifying SPY orders, amending required criteria for Tiers 2 through 4 and MM Cross-Asset Add Tier 1, amending the current rebate for Tiers 1 through 4 and MM Cross-Asset Add Tier 1, and adopting a new Tier 5 is reasonable, equitable, and not unfairly discriminatory.
The Exchange believes that it is reasonable and equitable to eliminate MM Cross-Asset Tier 2, because the Exchange is not required to maintain this tier or provide Members an opportunity to receive reduced fees or enhanced rebates. Two Members are currently satisfying the criteria under this tier, and the Exchange now wishes to consolidate this tiered pricing program and redirect resources and funding into other programs and tiers intended to incentivize increased order flow. Further, Members still have other opportunities to obtain reduced fees via the MM Penny Add Tiers 1 through 5 and the remaining MM Cross-Asset Tier, as amended.
The Exchange believes that eliminating MM Cross-Asset Tier 2 is equitable and not unfairly discriminatory because it applies uniformly to all Members, in that the tier will not be available for any Member. The Exchange also notes that the proposed change will not adversely impact any Member's ability to qualify for other rebate tiers. Further, the MM Penny Add Tiers 1 through 5 and the remaining MM Cross-Asset Tier, as amended, will continue to apply uniformly to all qualifying Members, in that all Members that submit the requisite order flow per each tier program have the opportunity to compete for and achieve the available tiers.
The Exchange also believes it is reasonable, equitable and not unfairly discriminatory to adopt SPY-specific rebates for qualifying MM orders in SPY which meet the add liquidity thresholds and yield fee code PM. Specifically, the Exchange believes the proposed change is reasonable, as the Exchange already maintains product-specific pricing for other products, such as RUT.
The Exchange believes its proposal to amend the current rebate for MM Penny Add Tiers 1 through 4 and MM Cross-Asset Add Tier 1, and amend required criteria for MM Penny Add Tiers 2 through 4 and MM Cross-Asset Add Tier 1 is reasonable, equitable, and not unfairly discriminatory. Specifically, the Exchange believes the proposed reduced rebates for Tiers 2, 3, and 4 are reasonable because Members are still eligible to receive a rebate for meeting the corresponding criteria, albeit at a lower amount than before. While, as proposed, the MM Penny Add Tiers 2, 3, and 4 will provide lower rebates than that currently offered, the Exchange still believes that the changes are reasonable as the tiers, even as amended, will continue to incentivize Members to send additional MM orders to the Exchange. Further, the Exchange notes that, in regards to Tiers 2 and 4, the reduced rebates are counterbalanced by lower qualification thresholds. Rebates that incentivize MM activity may provide for deeper, more liquid markets and execution opportunities at improved prices, which ultimately offers additional cost savings, supports the quality of price discovery, promotes market transparency and improves market quality for all investors. Moreover, the Exchange is not required to maintain these tiers nor provide rebates. The Exchange believes the proposed changes to the rebates offered under these tiers still remain commensurate with the corresponding criteria under the respective tiers.
The Exchange believes the increased rebate for MM Penny Add Tier 1 and MM Cross-Asset Add Tier 1 is reasonable, as such changes are designed to encourage Members to increase their liquidity on the Exchange and, in the case of MM Cross-Asset Add Tier 1, also their participation on BZX Equities to continue to achieve the rebate offered under MM Penny Add Tier 1 or MM Cross-Asset Tier 1. As noted above, increased MM activity facilitates tighter spreads and an increase in overall liquidity provider activity, both of which signal additional corresponding increase in order flow from other market participants, contributing towards a robust, well-balanced market ecosystem. Indeed, increased overall order flow benefits investors across both the Exchange's options and equities platforms by continuing to deepen the Exchange's liquidity pool, potentially providing even greater execution incentives and opportunities, offering additional flexibility for all investors to enjoy cost savings, supporting the quality of price discovery, promoting market transparency and improving investor protection.
Further, the Exchange believes the proposed changes to the required criteria for Tiers 2 through 5 and MM Cross-Asset Add Tier 1 are reasonable because they continue to provide opportunities for Members to receive higher rebates by providing for incrementally increasing volume-based criteria they can reach for. The proposed changes, in general, ease the requirement to achieve applicable tier threshold, which the Exchange believes will continue to serve as a reasonable means to encourage Members to increase their liquidity on the Exchange, particularly in connection with additional MM order flow to the Exchange, to the benefit of investors. The Exchange also believes the proposed change to add MM Penny Add Tier 5 is reasonable because it provides additional opportunities for Members to
The Exchange believes the proposed criteria remain commensurate with the corresponding enhanced rebates. The Exchange believes the revised criteria will continue to encourage Members to send additional MM orders to the Exchange. Greater add volume order flow may increase transactions on the Exchange, which the Exchange believes incentivizes liquidity providers to submit additional liquidity and execution opportunities. An overall increase in activity deepens the Exchange's liquidity pool, offers additional cost savings, supports the quality of price discovery, promotes market transparency and improves market quality for all investors.
Finally, the Exchange believes the proposed changes to the MM Penny Add Tiers are equitable and not unfairly discriminatory because they apply uniformly to all MMs, who will have the opportunity to meet the tiers' criteria and receive the corresponding enhanced rebate for each tier if such criteria is met. Further, the Exchange believes that it is equitable and not unfairly discriminatory to apply the proposed changes to MMs as compared to other market participants, because MMs, unlike other market participants, take on a number of obligations, including quoting obligations, which other market participants do not have. Further, these rebates are intended to incentivize MMs to quote and trade more on the Exchange, thereby providing more trading opportunities for all market participants.
Without having a view of activity on other markets and off-exchange venues, the Exchange has no way of knowing whether these proposed changes would definitely result in any Members qualifying for the proposed rebates. While the Exchange has no way of predicting with certainty how the proposed changes will impact Member activity, based on trading activity from the prior months, the Exchange anticipates that up to two Members could achieve Tier 2, up to two Members could achieve Tier 3, and up to one Member could achieve Tier 4. While the Exchange anticipates no Members will immediately achieve Tier 5 and the MM Cross-Asset Add Tier, the Exchange believes the proposed changes could incentivize MM to increase their order flow to attempt to achieve these tiers. Should a Member not meet the proposed new criteria, the Member will merely not receive that corresponding enhanced rebate.
The Exchange believes its proposal to update the required criteria for MM Non-Penny Add Volume Tier 1 is reasonable, equitable, and not unfairly discriminatory. While the proposed criteria increases the requirement to achieve the Tier 1 rebate slightly, the Exchange still believes that the changes are reasonable as the tier, even as amended, will continue to incentivize Members to send additional MM orders to the Exchange. An overall increase in MM activity may provide for deeper, more liquid markets and execution opportunities at improved prices, which ultimately offers additional cost savings, supports the quality of price discovery, promotes market transparency and improves market quality for all investors. Moreover, the Exchange is not required to maintain these tiers nor provide rebates.
The Exchange believes that it is reasonable and equitable to eliminate MM Non-Penny Add Volume Tier 3, because the Exchange is not required to maintain these tiers or provide Members an opportunity to receive reduced fees or enhanced rebates. No Members are currently satisfying the criteria under this tier, and the Exchange wishes to consolidate this tiered pricing program and redirect resources and funding into other programs and tiers intended to incentivize increased order flow. Further, Members still have other opportunities to obtain reduced fees via the remaining MM Non-Penny Add Volume Tiers 1 (as amended) and 2.
The Exchange believes that eliminating MM Non-Penny Add Volume Tier 3 is equitable and not unfairly discriminatory because it applies uniformly to all MMs, in that, such tiers will not be available for any MM. The Exchange also notes that the proposed change will not adversely impact any Member's pricing or their ability to qualify for other rebate tiers. Further, MM Non-Penny Add Volume Tiers 1 (as amended) and 2 will continue to apply uniformly to all qualifying Members, in that all Members that submit the requisite order flow per each tier program have the opportunity to compete for and achieve the available tiers. The Exchange also believes the proposed changes to MM Non-Penny Add Volume Tier 1 is equitable and not unfairly discriminatory because it applies uniformly to all MMs, who will have the opportunity to meet the tier's criteria and receive the corresponding enhanced rebate for the tier if such criteria is met. Without having a view of activity on other markets and off-exchange venues, the Exchange has no way of knowing whether these proposed changes would definitely result in any Members qualifying for the proposed rebate. While the Exchange has no way of predicting with certainty how the proposed changes will impact Member activity, based on trading activity from the prior months, the Exchange anticipates that up to three Members could qualify for this tier.
The Exchange believes its proposal to adopt a Customer Penny Take Tier is reasonable, equitable, and not unfairly discriminatory. The Exchange believes the proposed Customer Penny Take Tier program is reasonable because it provides the opportunity for Members to receive a lesser fee by providing for increased volume-based criteria they can reach for, similar to programs at other options exchanges.
Finally, the Exchange believes the proposed change to adopt a Customer Penny Take Tier program is equitable and not unfairly discriminatory because it applies uniformly to all Members, who will have the opportunity to meet the tier criteria and receive the corresponding enhanced rebate if such criteria is met. The Exchange also believes that it is equitable and not unfairly discriminatory to apply the proposed program to Customer order flow, as compared to other market participant order flow, because Customer order flow enhances liquidity on the Exchange for the benefit of all market participants. Specifically, Customer liquidity benefits all market participants by providing more trading opportunities, which attracts MMs. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow
Without having a view of activity on other markets and off-exchange venues, the Exchange has no way of knowing whether these proposed changes would definitely result in any Members qualifying for the proposed rebate. While the Exchange has no way of predicting with certainty how the proposed changes will impact Member activity, based on trading activity from the prior months, the Exchange anticipates that up to four Members could achieve the tier criteria.
The Exchange believes that it is reasonable and equitable to eliminate the Firm, BD, and JBO Penny Add Volume Tiers under footnote 2 of the Fee Schedule; the MM, Away MM, and Professional Penny Take Volume Tiers under footnote 3 of the Fee Schedule; the Firm, BD, and JBO Non-Penny Add Volume Tiers under footnote 8 of the Fee Schedule; the Away MM Penny Add Volume Tiers under footnote 10 of the Fee Schedule; and the Away MM Non-Penny Add Volume Tiers under footnote 11 of the Fee Schedule. The Exchange is not required to maintain these tiers or provide Members an opportunity to receive reduced fees or enhanced rebates. No Members are currently satisfying the criteria under the Firm, BD, and JBO Penny Add Volume Tiers; only one Member currently satisfies the criteria under the MM, Away MM, and Professional Penny Take Volume Tiers; three Members are currently satisfying the criteria under the Firm, BD, and JBO Non-Penny Add Volume Tiers; no Members are currently satisfying the criteria under the Away MM Penny Add Volume Tiers; and only one Member currently satisfies the criteria under the Away MM Non-Penny Add Volume Tiers. The Exchange wishes to consolidate its pricing program and redirect resources and funding into other programs and tiers intended to incentivize increased order flow.
The Exchange believes that eliminating the Firm, BD, and JBO Penny Add Volume Tiers; the MM, Away MM, and Professional Penny Take Volume Tiers; the Firm, BD, and JBO Non-Penny Add Volume Tiers; the Away MM Penny Add Volume Tiers; and the Away MM Non-Penny Add Volume Tiers is equitable and not unfairly discriminatory because it applies uniformly to all Members, in that, such tiers will not be available for any Member. The Exchange also notes that the proposed change will not adversely impact any Member's ability to qualify for other rebate tiers.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe the proposed changes will impose any burden on intramarket competition. Particularly, the proposed change applies to all participants, as applicable. Specifically, the proposed change to amend the transaction fee for Customer orders in Penny Program securities that remove liquidity will apply to all Members equally, in that the new rate of $0.48 per contract will automatically apply to all orders that yield fee code PC. Similarly, the under the proposed change, fee code PP will be appended to all Non-Customer orders (
Further, the proposed amendments to the MM Penny Add Volume Tiers and MM Non-Penny Add Volume Tiers apply uniformly to all MMs, in that all MMs have the opportunity to meet each of the respective program's tier's criteria and receive the corresponding enhanced rebate for the tier if such criteria are met. To the extent appointed MMs receive a benefit that other market participants do not, these Members in their role as MMs on the Exchange have different obligations and are held to different standards. For example, Market-Makers play a crucial role in providing active and liquid markets in their appointed products, thereby providing a robust market which benefits all market participants.
Similarly, the proposed amendments to the Customer Penny Add Volume Tiers and the new Customer Penny Take Volume Tier program apply uniformly to all Members, who will have the opportunity to meet each of the respective program's tier's criteria and receive the corresponding enhanced rebate for the tier if such criteria is met. As discussed above, Customer order flow enhances liquidity on the Exchange for the benefit of all market participants. Specifically, Customer liquidity benefits all market participants by providing more trading opportunities, which attracts MMs. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants. The rebates offered to Customers under the programs are intended to attract more Customer trading volume to the Exchange.
For each of the incentive programs, all Members are able to increase their applicable order flow to attempt to achieve each of the program's respective tiers. Should a Member not meet the criteria under a program, the Member will merely not receive that corresponding enhanced rebate.
Finally, the proposal to eliminate the MM, Away MM, and Professional Penny Take Volume Tier program, Away MM Penny Add Volume Tier program, Away MM Non-Penny Add Volume Tier program, Firm, BD, and JBO Non-Penny Add Volume Tier program, and Firm, BD, and JBO Penny Add Volume Tier program applies uniformly to all participants as applicable, in that, such tiers will not be available to any participants.
The Exchange also does not believe that the proposed rule change will impose any burden on intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act. As previously discussed, the Exchange operates in a highly competitive market. Members have numerous alternative venues that they may participate on and direct their order flow, including 17 other options exchanges and off-exchange venues. Additionally, the Exchange represents a small percentage of the overall market. Based on publicly available information, no single options exchange has more than 16% of the market share.
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On August 22, 2025, the Nasdaq Stock Market LLC (“Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
Cboe Exchange, Inc. (the “Exchange” or “Cboe Options”) proposes to amend Rule 5.4. The text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to amend Rule 5.4(a) to change the minimum increment for all series of options on the Cboe Magnificent 10 Index (“MGTN options”)
With regard to the impact of this proposed rule change on system capacity, the Exchange has analyzed its capacity and represents that it and the Options Price Reporting Authority have the necessary systems capacity to handle any potential additional traffic associated with this proposal. The Exchange does not believe any potential increased traffic will become unmanageable since this proposed rule change with respect to minimum trading increments is limited to a single class of options.
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the “Act”) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
In particular, the Exchange believes the proposed rule change will protect investors and the public interest. As discussed above, the Exchange believes market demand (including by retail investors, who generally prefer lower trading increments) supports a lower trading increment for MGTN options. Options overlying the components of the Cboe Magnificent 10 Index are among the most actively traded options (as are the underlying stocks), which options are eligible for a lower trading increment, supporting the view that there will be market demand for the proposed trading increments for MGTN options. The proposed rule change will permit more granular pricing in MGTN options, which may lead to narrower bid-ask spreads for these options and increase the possible number of price points available to investors for these series, which ultimately increases liquidity to the benefit of all investors. The Exchange believes tighter spreads will also increase order flow in MGTN options, which additional liquidity ultimately benefits all investors. Further, finer increments also permit more precise pricing in line with the theoretical value of these options.
Additionally, the Exchange believes the proposed rule change will promote just and equitable principles of trade and remove impediments to and perfect the mechanism of a free and open market and a national market system because it will permit MGTN options to
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change will not impose any burden on intramarket competition that is not necessary or appropriate, because all Trading Permit Holders will be able to trade MGTN options in the proposed minimum trading increments. The proposed rule change will not impose any burden on intermarket competition that is not necessary or appropriate, because it will permit MGTN options to have pricing consistent with the pricing of competitive products that are part of the Penny Interval Program and may currently trade in increments of $0.01 or $0.05. Additionally, the proposed rule change to permit MGTN options to be listed in penny and nickel increments may relieve any burden on, or otherwise promote, competition, as it will allow market participants to trade these options at the same level of granularity as permitted for competitor products, as discussed above. The Exchange also expects the more granular pricing to lead to narrowing of the bid-ask spread for these options, which the Exchange believes will increase order flow and price competition in MGTN options.
The Exchange neither solicited nor received comments on the proposed rule change.
Within 45 days of the date of publication of this notice in the
A. by order approve or disapprove such proposed rule change, or
B. institute proceedings to determine whether the proposed rule change should be disapproved.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-CBOE-2025-069 and should be submitted on or before October 21, 2025.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On July 15, 2025, Banque Centrale de Compensation, which conducts business under the name LCH SA (“LCH SA”), filed with the Securities and Exchange Commission (the “Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”)
LCH SA is a clearing agency registered with the Commission. Through its CDSClear business unit, LCH SA provides central counterparty services for security-based swaps, including credit default swaps and options on credit default swaps. LCH SA is an affiliate of LCH, Ltd, through common ownership by LCH Group Holdings Limited (“LCH Group”). LCH SA's ultimate parent company is London Stock Exchange Group. LCH Group issued the Risk Policies, and, thereafter, LCH SA adopted them.
LCH SA's Risk Policies formally enact the specific risk management requirements that govern its operations as a clearing agency. The policies and procedures set forth therein clarify the roles and responsibilities within LCH SA for compliance with the Risk Policies. LCH SA's Risk Policies must ensure consistency with all relevant laws and regulations, including the European Markets Infrastructure Regulation (“EMIR”) and, relevant here, Section 17A of the Act
The Collateral Risk Policy (“CRP”) sets forth the LCH Group standards for the management of collateral risk at LCH SA, how LCH SA intends to monitor collateral risk, which personnel own the CRP, and the internal review cycle. LCH SA's management of collateral risk is subject to the risk appetite defined in the Risk Governance Framework (“RGF”), which is discussed in greater detail below. Generally, the CRP ensures LCH SA's capability to process and control the collateral posted by its members.
With respect to managing collateral risks, the CRP applies to collateral accepted by LCH SA to cover margin requirements and default fund contributions.
The CRP also sets forth requirements for the approval of eligible cash and non-cash collateral. In particular, the CRP establishes that margin requirements can be covered by a mixture of cash and eligible non-cash collateral (
LCH SA primarily, but not exclusively, accepts EUR, GBP, and USD as the currencies for margin and default fund contributions. Further, the policy requires default fund contributions to be met by cash
With regards to non-cash collateral, the CRP provides that all traded securities must meet certain credit, liquidity and market risk requirements to be eligible as collateral for margin.
The CRP also addresses changes to collateral eligibility, providing that for new currencies and new issuers within an approved collateral type to be accepted as collateral, discretionary approval from the LCH SA Executive Committee (“ERCo”) is required.
The CRP also establishes a framework for monitoring market, credit, concentration/liquidity, wrong way and FX risks. Such risks are covered by baseline haircuts, haircut add-ons, limits, and/or price adjustments, as detailed in the policy. The policy provides that the ability of LCH SA to realize the value of collateral lodged by its member within the assumed holding period is affected by the collateral's market liquidity and the size of the position to be liquidated.
The CRP further provides that the ERCo may impose haircut add-ons and/or impose new limits or price adjustments on certain types of non-cash collateral based on their market liquidity, and, in particular, CaLM's ability to realize the value of the securities in the event of a default. In addition, the ERCo has the discretion to assess haircut add-ons on clearing members, based on their exposures, domicile, or portfolio of collateral posted, to protect LCH SA's financial resources and liquidity position. Collateral haircuts are subject to daily stress testing with any exceptions to be notified to the ERCo.
The Executive Responsible for the CRP is the Chief Executive Officer (“CEO”), and the CRP policy owner is the Chief Risk Officer (“CRO”). The CRO's responsibilities include, in part, ensuring the monthly review of published collateral haircuts,
The Financial Resource Adequacy Policy (“FRAP”) sets forth the standards governing the assessment of financial resources (
The FRAP also details the standards for addressing procyclicality in the risk frameworks and models used by the LCH CCPs. According to LCH SA, the Board's appetite for both Latent Market Risk and Procyclicality Risk is low.
The FRAP requires LCH SA to impose, call, and collect margins at least daily on each day when its Clearing Services are open and operating in order to limit its credit exposures
Similarly, the FRAP also specifies the standards for LCH SA's default fund arrangements. Among other things, LCH SA's default funds must meet the “cover-2” standard,
The FRAP allows, in addition, offsets or reductions in the required margin, subject to certain conditions being met (
The FRAP sets forth the limit framework for clearing exposures at the member and member group level, with the primary limit being that no one member or member group can use more than 45% of the default fund; lower credit quality members may be subject to more stringent limits. The FRAP requires that LCH SA monitor these limits daily for each member in each Default Fund.
To address the risk that LCH SA may also have exposure to clearing members as investment counterparties, LCH SA imposes a concentration limit framework at the counterparty level. The FRAP defines a Capital at Risk (“CAR”) amount for each member or member group which, together with the aggregate risk exposure of that member or member group, must not be greater than 30% of the entire LCH SA capital.
The FRAP further requires that LCH SA run liquidity stress tests,
The Executive Responsible for the FRAP is the LCH SA CEO, and the policy is owned by the Chief Risk Officer. The FRAP is also subject to oversight by both the LCH Ltd and LCH SA board Risk Committees. The FRAP's appropriateness is reviewed annually by the ERCo; any significant findings must be reported to the Risk Committee and Boards.
The Counterparty Credit Risk Policy (“CCRP”) describes how LCH SA assesses and manages counterparty credit risk, including the processes it uses to manage that risk, responsible personnel, and the review cycle for the policy. The CCRP defines counterparty credit risk as the risk that a counterparty, including members and all intermediaries where there is exposure through payment, clearing and settlement processes, will be unable to fully meet its financial obligations when due, or at any time in the future.
LCH SA manages and monitors counterparty credit risk primarily through internal credit scores (“ICS”). The CCRP requires that LCH SA assign an ICS to all clearing members and the sovereign of their country of risk (and that of their parent, if different); LCH SA's Credit Risk Team assigns and maintains ICS for each counterparty. The CCRP also requires that all applicable counterparties be subject to a formal documented ICS assessment before on-boarding, and then at least once a year.
On the front end, the CCRP contemplates preliminary vetting of a member applicant's credit profile. Specifically, LCH SA performs a Credit Assessment Review and provides an ICS recommendation for all new clearing member applications, including the sovereign credit assessment, and an ICS recommendation of the prospective clearing member and its parent jurisdiction. The CCRP sets out certain minimum ICS that prospective clearing members must meet before approval. The LCH SA ERCo has the discretion to reject any clearing member application regardless of that prospective member's ICS.
The CCRP also sets out thresholds that LCH SA uses to limit its exposure to counterparties and explains how LCH SA monitors these thresholds; the LCH SA Credit Risk Team assigns, maintains, and monitors applicable limits. Each clearing member and clearing member group is subject to an uncovered stress losses/net capital threshold, as detailed in Annex I of the CCRP. Clearing members are also subject to a ratio of initial margin to net capital and an overall credit tolerance. LCH SA must monitor these thresholds daily.
Under the CCRP, if a clearing member's credit profile deteriorates, or a clearing member otherwise breaches a threshold, LCH SA may, on a discretionary basis, modify the member's margin requirements. LCH SA has stated that the aim of additional margin is to ensure that as a clearing member's credit quality deteriorates below its entry requirement, it can progressively call upon additional resources to mitigate stress losses with eligible resources.
LCH SA monitors all thresholds daily and applies credit tolerances daily.
The CRO is the owner of the CCRP.
ERCo must review the appropriateness of the CCRP annually. Following ERCo's review, the LCH SA Risk Committee will review the appropriateness of the CCRP and recommend approval by the LCH SA Board. Finally, ERCo must approve, and notify the LCH SA Risk Committee of, changes to the annexes of the CCRP.
The Operational Risk Management Policy (“ORMP”) describes how LCH SA manages operational risk, including the processes it uses to manage that risk, how LCH SA monitors that risk, the responsible personnel, and the review cycle for the policy. The ORMP defines operational risk as the risk of loss arising from inadequate or failed internal processes, people and systems, or from external events. The ORMP applies to all operations within LCH SA, including all LCH SA employees, regardless of the basis or term of their employment. The OMRP also applies where business functions are outsourced to any third party.
Per the ORMP, LCH SA uses the three lines of defense model to manage and mitigate operational risk. All services and functions responsible for business as usual and change activities are considered the First Line of Defence. The First Line of Defence is responsible for ensuring adherence to all aspects of the ORMP and are accountable for identifying, assessing, monitoring, mitigating and managing operational risk. The LCH SA Risk Department is the Second Line of Defence, and it is responsible for providing oversight, support and challenge to the First Line, ensuring that the ORMP is aligned to the Board risk appetite, and for providing appropriate training to all relevant LCH SA staff. Internal Audit is the Third Line of Defence, and it is responsible for validating that the control environment is operating in alignment with the Board's risk appetite and the policies approved by the Board. The First Line of Defence also uses a risk taxonomy to identify applicable operational risks. LCH SA business and department heads also complete a self-assessment of the risk and control profile, which is reviewed and challenged by the Second Line of Defence. Finally, the First Line of Defence must have processes to assess whether the controls they use to mitigate operational risk are adequately designed and operating effectively.
The ORMP also accounts for risk contingencies, detailing the process to be followed when the following risk events occur triggering a re-assessment of risks and controls: (i) incidents and actual losses;
The CRO is the responsible executive for the ORMP, and the LCH SA Chief Risk Officer is the policy owner. Moreover, the LCH SA Board is responsible for: (i) determining LCH SA's “risk appetite” regarding operational risk; (ii) overall compliance with the risk management framework; and (iii) ensuring that management maintains an adequate system of internal controls appropriate to LCH SA and the risks to which it is exposed.
The Chief Risk Officer is the ORMP's policy owner. Changes to, and annual reviews of, the ORMP require approval by the LCH SA Risk Committee, the LCH SA Operational Resilience Committee, and the LCH SA Board. Changes to the annexes to the ORMP require approval of the LCH SA CRO and notification to the relevant governance committees.
The Third Party Risk Management Policy (“TPRMP”) describes how LCH SA manages risks while contracting with a third party, including how LCH SA manages and monitors this risk, the responsible personnel, and the review cycle for the policy. The TPRMP applies to all types of third parties, including internal and external service providers.
The TPRMP and the associated TPRMP Standard set forth in the RGF set out LCH Group's minimum requirements for managing potential risks when entering into and managing all third party relationships. LCH SA's third party relationships consist of what LCH SA identifies in the TPRMP as the “Third Party lifecycle.” The Third Party Lifecycle consist of four (4) phases: (i) identify the need to leverage third party services and select the most appropriate third party provider (“Plan and Select”);
The TPRMP also sets out the roles and responsibility within LCH SA for implementing the standards undergirding the four phases identified above.
Finally, the TPRMP sets out the key principles that underpin LSEG's approach to managing third party engagements, such as understanding and reducing concentration risk.
The LCH SA Chief Risk Officer is the Policy Owner. The LCH SA Chief Risk Officer must review the TPRMP on an annual basis, with approval by the LCH SA Chief Operating Officer. In addition, the LCH SA Board Operational Resilience Committee and Risk Committee must approve any material changes to the TPRMP.
Unlike the other Risk Policies, the Risk Governance Framework (“RGF”) does not focus on any specific risk at LCH SA. Rather, the RGF identifies and assesses five categories of Key Risks that LCH SA faces in its operations: (i) financial and model risks associated directly with clearing activities; (ii) risks relating to operational resilience; (iii) strategic risks; (iv) people and culture risks; and (v) regulatory compliance, legal and corporate disclosure risks. In assessing the magnitude each of these Key Risks, the RGF establishes a hierarchical taxonomy comprising of levels zero (0), one (1) and two (2).
With respect to these Key Risks, the RGF sets out: (i) the LCH SA Board's “risk appetite” across the Key Risks; (ii) the taxonomy of the Key Risks (including the rated level of each Key Risk and the Board's risk appetite for that risk); (iii) the roles and responsibilities within LCH SA for managing each identified Key Risk; (iv) the standards to be met by LCH SA when managing its business activities within the determined risk appetite; and (v) the indicators and tolerance thresholds by which each Key Risk is meant to be measured and reported.
The RGF again establishes the “Three Lines of Defence” model for managing and monitoring these Key Risks. Like the ORMP, LCH SA Function Heads and Business Heads (excluding the CRO, LCH SA Chief Compliance Officer, and Head of Internal Audit) manage the risks of all LCH SA's business activities and therefore constitute the First Line of Defence. The CRO,
The RGF also discusses the following: (i) the LCH SA Board's risk appetite and standards; (ii) relevant risk indicators and tolerance thresholds to assist with
The RGF is reviewed and signed off by the LCH SA Board at least annually. In LCH SA's view, annual review of the RGF provides assurance that all risks continue to be appropriately identified and mapped, that the statement of risk appetite is clear and defined at the appropriate level of granularity, that ownership and responsibilities are clear, and that there is an appropriate process for monitoring and reporting on all risks against LCH SA's appetite.
Section 19(b)(2)(C) of the Act requires the Commission to approve a proposed rule change of a self-regulatory organization if it finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to the organization.
The description of a proposed rule change, its purpose and operation, its effect, and a legal analysis of its consistency with applicable requirements must all be sufficiently detailed and specific to support an affirmative Commission finding,
After carefully considering the proposed rule change, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to LCH SA. More specifically, for the reasons given below, the Commission finds that the proposed rule change is consistent with Section 17A(b)(3)(F) of the Act,
Section 17A(b)(3)(F) of the Act requires, among other things, that the rules of LCH SA be designed to promote the prompt and accurate clearance and settlement of securities transactions and, to the extent applicable, derivative agreements, contracts, and transactions, as well as to assure the safeguarding of securities and funds which are in the custody or control of LCH SA or for which it is responsible.
As discussed above, LCH SA's Risk Policies formally enact the specific risk management requirements that govern its day-to-day operations as a clearing agency. The policies and procedures set forth therein clarify the roles and responsibilities within LCH SA for compliance with the Risk Policies. To that end, LCH SA has identified specific risks areas that may compromise its business operations. Such risk areas include, but are not limited to, collateral risk, Latent Market Risks, counterparty credit risk, third party risk, other “Key Risks,” as discussed above, and operational risk. The corresponding risk policies consist of detailed risk management requirements that govern LCH SA's clearing agency operations.
These risks, if not properly managed, could disrupt LCH SA's clearing services and its ability to safeguard funds. For example, corruption of LCH SA's data or other technological disruption could interpret LCH's clearing services and its safeguarding of funds. Thus, the risks addressed by the Risk Policies, if not managed or mitigated, could prevent LCH SA from promptly and accurately clearing and settling transactions and safeguarding funds. The Risk Policies, in turn, help LCH SA to manage and mitigate these risks, are therefore consistent with the prompt and accurate clearance and settlement of securities transactions and the safeguarding of securities and funds which are in the custody or control of LCH SA or for which it is responsible.
Accordingly, the Commission finds that the proposed rule change is consistent with the requirements of Section 17A(b)(3)(F) of the Act.
Rules 17ad-22(e)(2)(i) and (v)
Accordingly, the Commission finds that the proposed rule change is consistent with the requirements of Rule 17ad-22(e)(2)(i) and (v).
Rule 17ad-22(e)(3)(i) requires a covered clearing agency to establish, implement, maintain and enforce written policies and procedures reasonably designed to maintain a sound risk management framework for comprehensively managing legal, credit, liquidity, operational, general business, investment, custody, and other risks that arise in or are borne by the covered clearing agency, which includes risk management policies, procedures, and systems designed to identify, measure, monitor, and manage the range of risks that arise in or are borne by the covered clearing agency, that are subject to review on a specified periodic basis and approved by the LCH SA Board annually.
LCH SA's RGF adequately sets forth necessary written policies and procedures establishing a risk management framework responsive to the various risks that a covered clearing agency must anticipate. As stated above, the RGF, which the LCH SA Board reviews and re-approves annually, identifies and categorizes Key Risks faced by LCH SA, sets out the roles and responsibilities within LCH SA for managing each identified Key Risk, provides the standards to be met by LCH SA when managing its business activities within the determined risk appetite, and establishes the indicators and tolerance thresholds by which each Key Risk is meant to be measured and reported. The RGF is designed to comprehensively manage identified Key Risks.
Accordingly, the Commission finds that the proposed rule change is consistent with the requirements of Rule 17ad-22(e)(3)(i).
Rule 17ad-22(e)(4)(ii) requires a covered clearing agency to establish, implement, maintain and enforce written policies and procedures reasonably designed to effectively identify, measure, monitor, and manage its credit exposures to participants and those arising from its payment, clearing, and settlement processes, including by maintaining financial resources at the minimum to enable it to cover a wide range of foreseeable stress scenarios that include, but are not limited to, the default of the two participant families that would potentially cause the largest aggregate credit exposure for the covered clearing agency in extreme but plausible market conditions.
LCH SA addresses maintaining financial resources in the FRAP, which describes the standards governing the assessment of financial resources (
The FRAP's stress testing protocols adequately address both LCH SA's capacity to mitigate credit exposure risks and its ability to meet its minimum financial resource requirements. Specifically, the FRAP requires LCH SA to run liquidity stress tests, collateral stress tests, and exposure stress testing (
The FRAP also establishes standards maintaining LCH SA's default fund, including requiring that LCH SA meet the “cover-2” standard.
Accordingly, the Commission finds that the proposed rule change is consistent with the requirements of Rules 17ad-22(e)(4)(ii),
Rule 17ad-22(e)(5)
LCH SA's CRP sets forth acceptance criteria (
Accordingly, the Commission finds that the proposed rule change is consistent with the requirements of Rule 17ad-22(e)(5).
Rules 17ad-22(e)(6)(i) and (ii)
The FRAP requires LCH SA to impose, call and collect daily margin. Stated otherwise, the FRAP details LCH SA's standards by which financial resources should be assessed against member exposure—this includes variation margins, initial margins, margin add-ons for liquidity risk, among other resources. To that end, the FRAP permits for Clearing Services to call for intraday margin, where necessary, consistent with Rule 17ad-22(e)(6)(ii).
Accordingly, the Commission finds that the proposed rule change is consistent with the requirements of 17ad-22(e)(6)(i) and (ii).
Rules 17ad-22(e)(18)(ii) and (iii)
LCH SA addresses these requirements in its CCRP, which describe how it manages and assesses counterparty credit risk via an ICS and limit frameworks. To that end, LCH SA assigns every clearing member an ICS and goes on to describe in detail the exposure monitoring threshold and the limits and tolerance applied to each clearing member. By providing for the assignment, maintenance and monitoring of an ICS applied to each counterparty that LCH SA interacts with, as well as the monitoring of related counterparty credit risk thresholds, including clearing members, the CCRP is consistent with Rules 17ad-22(e)(18)(ii) and (iii).
Accordingly, the Commission finds that the proposed rule change is consistent with the requirements of 17ad-22(e)(18)(ii) and (iii).
On the basis of the foregoing, the Commission finds that the proposed rule change is consistent with the requirements of the Act, and in particular, with the requirements of Section 17A(b)(3)(F) of the Act,
IT IS THEREFORE ORDERED pursuant to Section 19(b)(2) of the Act
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On August 11, 2025, Cboe BZX Exchange, Inc. (“BZX”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On August 15, 2025, MIAX Sapphire, LLC (“MIAX Sapphire” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to amend various port fees in the Connectivity Fee Schedule. The proposed rule change is available on the Exchange's website at
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.
The Exchange proposes to amend the Connectivity Fee Schedule to make changes to the monthly recurring fees that Users
The Exchange currently provides ports (also referred to as “connections” and “network access”) to Users in the colocation halls of the MDC at the prices shown below. With this proposal, the Exchange proposes to increase its monthly recurring fees for these ports by amounts between 9.1% to 11.1% (the initial port charges would not change). As proposed, Users would be charged the following adjusted prices:
The proposed port fee increases would enable the Exchange to maintain and improve its market technology and services to remain competitive with its peers. Over the years, customer demand for more sophisticated, higher-throughput, lower-latency, and higher-power connectivity solutions has increased. The Exchange continues to invest in maintaining, improving, and enhancing its connectivity products, services, and facilities for the benefit and often at the behest of its customers. Such enhancements include refreshing hardware and expanding the Exchange's existing colocation facility to offer customers additional space and power.
As discussed below, the Exchange proposes to adjust its fees by an industry- and product-specific inflationary measure. It is reasonable and consistent with the Act for the Exchange to recoup its investments, at least in part, by adjusting its fees. Continuing to operate at fees frozen at 2017 levels impacts the Exchange's ability to enhance its offerings and the interests of market participants and investors.
The fee increases the Exchange proposes are based on an industry-specific Producer Price Index (“PPI”), which is a tailored measure of inflation.
For purposes of this proposal, the relevant industry-specific PPI is the Data Processing and Related Services PPI (“Data PPI”), which is an industry net-output PPI that measures the average change in selling prices received by companies that provide data processing services.
The Data PPI was introduced in January 2002 by the Bureau of Labor Statistics (BLS) as part of an ongoing effort to expand Producer Price Index coverage of the services sector of the U.S. economy and is identified as NAICS 518210 in the North American Industry Classification System.
The Exchange believes the Data PPI is an appropriate measure to be considered in the context of the proposed rule change to modify its port fees because the Exchange uses its “own computer systems” and “proprietary software,”
For purposes of this proposed rule change, the Exchange examined the Data PPI value for the period from January 2017 through March 2025 (the last month for which finalized data is available). The Data PPI had a starting value of 109.0 in January 2017 and an ending value of 121.880 in March 2025, an 11.82% increase. This indicates that companies who are also in the data storage and processing business have generally increased prices for a specified service covered under NAICS 518210 by an average of 11.82% during this period. Based on that percentage change, the Exchange proposes to increase its monthly recurring fees for the ports in the colocation halls of the MDC by up to 11.1%—slightly below the Data PPI increase of 11.82%—which reflects an increase covering the entire period since the last price adjustment to these fees was made.
The Exchange further believes the Data PPI is an appropriate measure for purposes of the proposed rule change on the basis that it is a stable metric with limited volatility, unlike other consumer-side inflation metrics. In fact, the Data PPI has not experienced a
The Exchange believes the Data PPI, and significant investments into, and enhanced performance of, the Exchange support the reasonableness of the proposed fee increases.
These proposed fee increases will be immediately effective upon filing. However, the Exchange proposes to delay the operative date of such changes until January 1, 2026, to give sufficient notice to market participants.
The Exchange believes the proposed rule change is consistent with the provisions of Section 6 of the Act,
This belief is based on two factors. First, the current fees do not properly reflect the quality of the services and products, as fees for these ports have been static in nominal terms, and therefore falling in real terms due to inflation. Second, the Exchange believes that investments made in enhancing the capacity and speed of Exchange systems has increased the performance of these ports.
As noted above, the Exchange has not increased any of the fees included in the proposal since 2017 or earlier. However, in the years following the last fee increases, the Exchange has made significant investments in upgrades to its connectivity products, services, and facilities, enhancing the quality of its services. In other words, Exchange customers have greatly benefited, while the Exchange's ability to recoup its investments has been hampered.
Between 2017 and 2025, the inflation rate was 3.51% per year, on average, producing a cumulative inflation rate of 31.79%.
Notwithstanding inflation, as noted above, the Exchange has not increased its fees for the subject services for more than eight years. The proposed fee changes therefore represent a modest increase from the current fees.
The Exchange believes the proposed fee increase is reasonable in light of the Exchange's continued expenditure in maintaining a robust technology ecosystem. Furthermore, the Exchange continues to invest in maintaining and enhancing its connectivity products—for the benefit and often at the behest of its customers and global investors. Such enhancements include refreshing several aspects of the technology ecosystem including software, hardware, and network while introducing new and innovative products and expanded and modernized facilities. The goal of the enhancements discussed above, among other things, is to provide faster, higher-capacity, and more modern connectivity products and services. Accordingly, the Exchange continues to expend resources to innovate and modernize its technology so that it may benefit its members in offering connectivity products and services.
The Exchange believes that the proposed fee increases are equitably allocated and not unfairly discriminatory because they would apply to all market participants that choose to purchase such connectivity products and services from the Exchange. Any participant that chooses to purchase the Exchange's connectivity products and services would be subject to the same Connectivity Fee Schedule, regardless of what type of business they operate or the use they plan to make of the products and services. Additionally, the fee increases would be applied uniformly to market participants without regard to Exchange membership status or the extent of any other business with the Exchange or affiliated entities.
The Exchange also believes that the proposal represents an equitable allocation of reasonable dues, fees, and other charges because Exchange fees have fallen in real terms during the relevant period. Finally, the Exchange believes that the proposed fee changes are not unfairly discriminatory because the fees would be assessed uniformly across all market participants, in the same manner they are today, that voluntarily purchase the Exchange's connectivity products and services, which would remain available for purchase by all market participants.
The Exchange does not believe that the proposed fees will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
No written comments were solicited or received with respect to the proposed rule change.
Pursuant to Section 19(b)(3)(A)(ii) of the Act,
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On August 29, 2025, the Options Clearing Corporation (“OCC”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change SR-OCC-2025-013, pursuant to Section 19(b) of the Securities Exchange Act of 1934 (“Exchange Act”)
Section 19(b)(2) of the Exchange Act
In order to provide the Commission with sufficient time to consider the Proposed Rule Change, the Commission finds that it is appropriate to designate a longer period within which to take action on the Proposed Rule Change.
Accordingly, the Commission, pursuant to Section 19(b)(2) of the Exchange Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
September 26, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange proposes to amend the Exchange's Bylaws to: (i) add the Risk Committee as a required committee, (ii) update the Audit Committee's responsibilities, (iii) allow the Compensation Committee flexibility when determining compensation of Directors, and (iv) clarify the composition of the Compensation and Regulatory Oversight Committees. The Exchange is also proposing to make non-substantive clarifying and conforming changes to the Bylaws. The text of the proposed rule change is available from the principal office of the Exchange and also on the Exchange's internet website at
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 these statements may be examined at the places specified in Item IV below. The self-regulatory organization has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to amend the Bylaws to make several changes. Specifically, the Exchange proposes to: (i) add the Risk Committee as a required committee, (ii) update the Audit Committee's responsibilities, (iii) allow the Compensation Committee flexibility when determining compensation of Directors, and (iv), clarify the composition of the Compensation and Regulatory Oversight Committees. The Exchange is also proposing to make non-substantive clarifying and conforming changes to the Bylaws, as described below. The Board of Directors of the Exchange determined these amendments to its Bylaws are appropriate and in the best interest of the Exchange after a regular review, by the Exchange, of documents governing the operation of the Board of Directors of the Exchange and its committees.
Under the Bylaws, the Board may appoint one or more additional Board Committees for such time as determined by the Board.
The Exchange is now proposing to update the Bylaws to include the specific requirement to have a Risk Committee. Specifically, the Exchange is adding new Section 6.08 to the Bylaws to codify the Risk Committee including the committee's responsibilities and composition.
• Add new Section 6.08 which would read in full: “Section 6.08 Risk Committee. The Board shall appoint a Risk Committee, which shall consist of not less than three (3), and no more than eleven (11) Directors, each of whom shall meet the requirements established in the Risk Committee charter. A majority of the Directors serving on the Risk Committee shall be Non-Industry Directors. The Risk Committee shall include one (1) Facility Director. The Risk Committee shall assist the Board in fulfilling its responsibilities with respect to the Exchange's oversight of risk assessment and risk management processes of the Exchange, as well as such other functions as may be specified in the charter of the Risk Committee.”
• Add the Risk Committee to the list of required committees under Section 6.01 (Board Committees).
The Exchange is adding the Risk Committee as a required committee of the Board in the Bylaws as the Risk Committee is a long-established committee and has been an integral part of the Exchange's oversight. The Exchange notes the authority to establish additional Board committees is already provided in the Bylaws.
The Exchange proposes to make certain edits to the Bylaws to narrow the scope of responsibilities of the Audit Committee. Currently, the Bylaws provide that the Audit Committee shall perform the specified primary functions,
The Exchange now proposes to amend Section 6.05 of the Bylaws to narrow the scope of the Audit Committee to provide that its oversight is limited to financial matters. Specifically, the Exchange is proposing to remove references to oversight of the Exchange's legal and compliance process from the description of the Audit Committee's duties, which is now overseen by the Risk Committee. Additionally, the Exchange is updating the Audit Committee's responsibilities to provide that internal controls, auditors, and internal audits are referring to internal financial controls, financial auditors, and internal financial audits. With the proposed changes, Section 6.05 will read as follows:
• Audit Committee. The Board shall appoint an Audit Committee, which shall consist of not less than three (3), and no more than five (5), Directors, none of whom shall be Officers or employees of the Exchange, and each of whom shall meet the requirements established in the Audit Committee charter. A majority of the Directors serving on the Audit Committee shall be Non-Industry Directors. The Audit Committee shall include one (1) Facility Director. The Audit Committee shall perform the following primary functions, as well as such other functions as may be specified in the charter of the Audit Committee: (A) provide oversight over the Exchange's financial reporting process and the financial information that is provided to the Members and others; (B) provide oversight over the systems of internal financial controls established by management and the Board; (C) select, evaluate and, where appropriate, replace the Exchange's independent financial auditors (or nominate the independent financial auditors to be proposed for ratification by the Members); and (D) direct and oversee all the activities of the Exchange's internal financial audit function, including but not limited to management's responsiveness to internal financial audit recommendations.
The Exchange believes these changes are consistent with the delegation of responsibilities between the various Board committees and is designed to align the Bylaws with the Board practices. The Exchange notes that this proposed change is consistent with the proposal to codify the Risk Committee in its Bylaws and to reduce overlap between the Risk Committee's responsibilities and the current description of the Audit Committee as the Risk Committee is responsible for oversight of risk assessment and risk management processes of the Exchange, which includes oversight of certain internal non-financial assessments and audits, for example. Additionally, oversight of the Exchange's legal and compliance process, which is currently listed under the Audit Committee responsibilities, will now solely fall under the purview of the Risk Committee. Therefore, the proposed changes to Section 6.05 are merely designed to provide clarity and consistency within the Bylaws.
The Exchange proposes allowing the Compensation Committee flexibility when determining compensation of Directors. The Compensation Committee is responsible for setting compensation, including compensation policies, programs, and practices for Directors, Officers and employees of the Exchange.
• Add “terms” to the first sentence of Section 4.12.
• Add “the Vice Chair” to the first sentence of Section 4.12.
With the proposed changes, Section 4.12 will read as follows:
• Section 4.12 Compensation. The Compensation Committee may provide for reasonable compensation terms of the Chair, the Vice Chair, the Directors, the members of any Board Committee and the members of any committee of the Exchange. The Compensation Committee may also provide for reimbursement of reasonable expenses incurred by such persons in connection with the business of the Exchange.
The Exchange is making these changes to provide flexibility when setting appropriate compensation for Directors and aligning with industry norms. The Exchange believes these changes are reasonable as they provide the Board with the appropriate latitude needed for setting compensation by removing unnecessary constraints. Additionally, the Exchange notes that it is not novel to have such flexibility when determining appropriate compensation.
Lastly, the Exchange is proposing to clarify the composition of the Compensation and Regulatory Oversight Committees. The Compensation Committee is responsible for setting compensation, including compensation policies, programs, and practices for Directors, Officers and employees of the Exchange.
The Exchange is proposing the below changes to codify that these committees shall also not include any Participant Directors.
• Amend Article 6, Section 6.06 by adding the following: “The Compensation Committee shall not include any Participant Directors.”
• Amend Article 6, Section 6.07 by adding the following: “The Regulatory Oversight Committee shall not include any Participant Directors.”
The Exchange notes that it is currently the requirement of the Board not to permit Participant Directors on the Compensation or Regulatory Oversight Committee in addition to Facility Directors, because the Bylaws currently require that the Committees be made up of Non-Industry Directors.
The Exchange is also proposing to make non-substantive conforming changes to the Bylaws to accommodate renumbering as a result of the changes to Section 6.08.
The Exchange believes that the proposal is consistent with the requirements of Section 6(b) of the Act,
The Exchange also believes that the proposed rule change is consistent with Section 6(b)(5) of the Act,
The Exchange believes that the proposed change to add the requirement to have a Risk Committee to the Bylaws continues to assure that the Exchange is so organized as to have the capacity to be able to carry out the purposes of the Act and to comply, and to enforce compliance by its Exchange members and persons associated with its Exchange members, with the provisions of the Exchange Act, the rules and regulations thereunder, and the rules of the Exchange because the Risk
The Exchange believes the edits to the Bylaws to update the oversight responsibilities of the Audit Committee to provide that they are limited to financial matters, including removing references to oversight of the Exchange's legal and compliance process, which is covered by the Risk Committee, is consistent with the Act, in that it will narrow the scope of the Audit Committee's responsibilities and reduce the potential for confusion given the existing overlap between the current description of the Audit Committee's responsibilities and the role of the Risk Committee, as detailed above. The Exchange believes further that it is in the public interest for the Exchange's corporate governance to be clear, consistent and administered fairly. Accordingly, the Exchange believes that these proposed changes to Section 6.05 are consistent with the Act, as such amendments update and clarify the Bylaws, thereby increasing transparency and helping to avoid any potential confusion by clarifying the scope of the committee's responsibilities. For these reasons, the Exchange believes such amendments enable the Exchange to be so organized as to have the capacity to carry out the purposes of the Act and the comply with the provisions of the Act, the rules and regulations thereunder, and the rules of the Exchange, promote just and just and equitable principles of trade, remove impediments to and perfect the mechanism of a free and open market, and protect investors and the public interest.
The Exchange believes the proposed changes to Section 4.12 of the Bylaws will allow the Exchange to continue to be so organized as to have the capacity to carry out the purposes of the Exchange Act and provide for the fair administration of the Exchange's affairs because the proposed changes will provide flexibility when setting appropriate compensation for Directors. It is in the public interest for the Exchange's corporate governance to be clear, consistent, and administered fairly. The Exchange believes that the proposed changes Section 4.12 of the Bylaws promote greater flexibility and remove unnecessary constraining language thereby promoting the fair administration of the Exchange. The Exchange believes further that the proposed change to codify, the existing practice,
The Exchange believes the proposed changes to the Bylaws to codify that both the Compensation and Regulatory Oversight Committees shall not include any Participant Directors continues to contribute to the orderly operation of the Exchange and provide for the fair administration of the Exchange's affairs as the Committees will continue to be made up of Non-Industry Directors. The Exchange believes further that the proposed change would be consistent with the existing composition requirements of the Committees, which would enable the Exchange to continue to be so organized as to have the capacity to carry out the purposes of the Act and comply with the provisions of the Act by its members and persons associated with members, thereby furthering the objectives of the Act. The proposed change is intended to provide added transparency regarding the composition of the Compensation and Regulatory Oversight Committees. Moreover, the Exchange believes that as a practical matter the proposed change is consistent with current requirements, as it is an existing requirement of the Exchange not to permit a Participant Director on the Compensation or Regulatory Oversight Committee,
Finally, the Exchange believes that the proposed non-substantive conforming changes to the Bylaws to accommodate renumbering, including an update to the cross reference in the definition of “Exchange Violation,” as a result of the changes to Section 6.08 further the purposes of the Act because they provide greater clarity and consistency to the Bylaws thereby reducing the potential for confusion by market participants. Additionally, the Exchange believes the proposed change replace the term Chairman throughout the Bylaws is reasonable because it is not proposing to make any changes to the existing duties or obligations of the Chairman and Vice Chairman and is merely proposing to update the term to use neutral terminology throughout the Bylaws. The Exchange believes the proposed changes are non-substantive, in that they will not amend or implicate the Exchange's governance as an “exchange” within the meaning of the Act. The Exchange believes that these proposed non-substantive changes are consistent with the Act, as such amendments update and clarify the Bylaws, thereby increasing transparency and helping to avoid any potential confusion from unclear provisions.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change relates to the corporate governance of the Exchange and not the operations of the Exchange. Therefore, the proposed rule change is not intended to address competitive issues but rather is concerned with the administration and governance of the Exchange and its Board Committees. The proposed changes are concerned solely with the corporate governance of the Exchange and do not present any issues that impact competition. This is not a competitive filing and, therefore, imposes no burden on competition. As such, the Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
The Exchange has neither solicited nor received comments on the proposed rule change.
The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
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 under Section 19(b)(2)(B)
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On June 4, 2025, the Financial Industry Regulatory Authority, Inc. (“FINRA”) filed with the Securities and Exchange Commission (“SEC” or “Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Exchange Act”)
The proposed rule change was published for comment in the
On September 24, 2025, FINRA responded to the comment letters received in response to the Notice
FINRA is proposing the following amendments to the filing:
Currently, CAB Rule 016(c)(1)(F)(i) allows a CAB to qualify, identify, solicit, or act as a placement agent or finder on behalf of an issuer in connection with a sale of newly issued unregistered securities to institutional investors. Partial Amendment No. 1 would amend this rule to provide that a CAB may represent an issuer or an institutional investor buyer in connection with a sale of newly issued unregistered securities. Thus, a CAB would no longer be expressly limited to acting on behalf of an issuer under CAB Rule 016(c)(1)(F)(i).
One commenter stated that “there is no material investor protection or other policy rationale for limiting CABs to acting as agent on the issuer/seller side of the market for institutional investor private placements.” FINRA agrees with this comment. FINRA believes that allowing a CAB also to act on behalf of an institutional investor buyer in connection with the sale of newly issued unregistered securities is consistent with CABs' limited institutional business model and would not materially impact investor protection.
Following are the changes proposed in Partial Amendment No. 1 with the proposed changes in the original filing shown as if adopted. Proposed new language in Partial Amendment No. 1 is italicized; proposed deletions in Partial Amendment No. 1 are in brackets:
(c) “Capital Acquisition Broker”
(1) A “capital acquisition broker” is any broker that solely engages in any one or more of the following activities:
(F) qualifying, identifying, soliciting, or acting as a placement agent or finder:
(i) on behalf of an issuer
As originally proposed, proposed CAB Rule 016(c)(1)(H) would have allowed CABs to act as a placement agent or finder on behalf of an institutional investor that seeks to sell unregistered securities that it owns where (i) the purchaser is an institutional investor and (ii) the sale qualifies for an exemption from registration under the Securities Act.
Partial Amendment No. 1 would revise the proposed rule to provide that a CAB may engage in qualifying, identifying, soliciting, or acting as a placement agent or finder on behalf of an institutional investor that seeks to sell or buy unregistered securities. Thus, a CAB would no longer be expressly limited to acting on behalf of a seller under proposed CAB Rule 016(c)(1)(H). Partial Amendment No. 1 also would revise subparagraph (i) to provide that both the seller and buyer
As with the sale of newly issued unregistered securities, one commenter stated that the Proposal
Following are the changes proposed in Partial Amendment No. 1 with the proposed changes in the original filing shown as if adopted. Proposed new language in Partial Amendment No. 1 is italicized; proposed deletions in Partial Amendment No. 1 are in brackets:
(c) “Capital Acquisition Broker”
(1) A “capital acquisition broker” is any broker that solely engages in any one or more of the following activities:
(H) qualifying, identifying, soliciting, or acting as a placement agent or finder on behalf of an institutional investor that seeks to sell
(i) the
(ii) the sale of such securities qualifies for an exemption from registration under the Securities Act.
CAB Rule 016(c)(1)(F)(ii) currently permits a CAB to qualify, identify, solicit, or act as a placement agent or finder on behalf of an issuer or control person in connection with the change of control of a privately held company. This rule defines “control person” as a person who has the power to direct the management or policies of a company through ownership of securities, by contract, or otherwise. This rule further specifies that control will be presumed to exist if, before the transaction, the person has the right to vote or the power to sell or direct the sale of 25% or more of a class of voting securities or in the case of a partnership or limited liability company has the right to receive upon dissolution or has contributed 25% or more of the capital. “Privately held company” is defined to mean a company that does not have any class of securities registered, or required to be registered, with the SEC under Exchange Act Section 12 or with respect to which the company files, or is required to file, periodic information, documents, or reports under Exchange Act Section 15(d).
This rule text was in part modeled on the Commission staff's 2014 M&A Brokers no-action letter, which the Commission withdrew when the M&A Brokers Exemption
In addition, the M&A Brokers Letter and the M&A Brokers Exemption do not refer to a “control person”; instead, they use the defined term “control” and consider whether control exists
Finally, the M&A Brokers Letter and the M&A Brokers Exemption define “control” as the power,
CAB Rule 016(c)(1)(G), as proposed to be amended pursuant to the Proposal, permits CABs to engage in M&A transactions to the same extent as exempt broker-dealers under the M&A Brokers Exemption. To more closely align the terms and conditions of these provisions, FINRA is proposing to amend CAB Rule 016(c)(1)(F)(ii) to eliminate the key differences described above. Specifically, Partial Amendment No. 1 would delete the term “control person” in CAB Rule 016(c)(1)(F)(ii) and permit a CAB to represent the buyer or the seller in a change of control transaction. In addition, the rule would be amended to define the term “control”—similar to the M&A Brokers Exemption—as the power,
Control will be presumed to exist if,
FINRA believes that a CAB should be permitted to represent both the buyer and seller in a transaction involving a change of control of a privately held company. However, such joint representation could present conflicts of interest for the CAB. Accordingly, FINRA is proposing new CAB Rule 016(c)(1)(F)(ii)b. to provide that a CAB may represent both the buyer and seller in the same transaction under paragraph (c)(1)(F)(ii) after providing clear written disclosure as to the parties the CAB represents and obtaining written consent from both parties to the joint representation. The proposed rule text mirrors the above-referenced language concerning joint representation found in the M&A Brokers Exemption, which addresses the same potential conflicts of interest that FINRA has identified and imposes the same disclosure and consent requirements as proposed CAB Rule 016(c)(1)(F)(ii)b.
While the proposed changes to CAB Rule 016(c)(1)(F)(ii) are not in direct response to a comment on the Proposal, FINRA nonetheless believes they are appropriate for similar reasons to the proposed changes to allow CABs to represent buyers in certain transactions (specifically, to represent institutional investor buyers in sales of newly issued unregistered securities and secondary unregistered securities transactions). In addition, as noted above, CAB Rule 016(c)(1)(G) permits CABs to engage in merger and acquisition transactions to the same extent as exempt broker-dealers under the M&A Brokers Exemption. Given the overlap between these provisions, FINRA believes that CAB Rule 016(c)(1)(F)(ii) should more closely align with the terms and conditions of the M&A Brokers Exemption to avoid having potentially confusing or conflicting requirements under the CAB Rules.
Although CABs would not be limited to representing buyers and sellers that are institutional investors in a transaction involving a change of control of a privately held company, FINRA believes that the proposed changes are nonetheless consistent with
Following are the changes proposed in Partial Amendment No. 1 with the proposed changes in the original filing shown as if adopted. Proposed new language in Partial Amendment No. 1 is italicized; proposed deletions in Partial Amendment No. 1 are in brackets:
(c) “Capital Acquisition Broker”
(1) A “capital acquisition broker” is any broker that solely engages in any one or more of the following activities:
(F) qualifying, identifying, soliciting, or acting as a placement agent or finder
(ii) [on behalf of an issuer or a control person] in connection with a change of control of a privately-held company
Because this Partial Amendment No. 1 would delete the defined term “control person” under CAB Rule 016(c)(1)(F)(ii), FINRA also is proposing a technical change to the proposed definition of “eligible employee” under new CAB Rule 016(m), which was proposed in the Proposal. Specifically, FINRA is proposing to replace “a control person” with “a person that controls the issuer.”
Following are the changes proposed in Partial Amendment No. 1 with the proposed changes in the original filing shown as if adopted. Proposed new language in Partial Amendment No. 1 is italicized; proposed deletions in Partial Amendment No. 1 are in brackets:
(m) “Eligible Employee”
The term “eligible employee” means, with respect to an issuer for which the capital acquisition broker has provided services to the issuer or a [control] person
FINRA also is proposing a technical change to CAB Rule 511 (Securities as Compensation), as proposed in the Proposal, to replace “paragraphs (c)(1) of Rule 016” with “Rule 016(c)(1).” This change would correct the inadvertent plural form used in the original proposed rule text and would be consistent with the format of the subsequent reference to Rule 016(c)(2) in that sentence.
Following are the changes proposed in Partial Amendment No. 1 with the proposed changes in the original filing shown as if adopted. Proposed new language in Partial Amendment No. 1 is italicized; proposed deletions in Partial Amendment No. 1 are in brackets:
A capital acquisition broker may receive compensation in the form of equity securities of a privately held issuer on behalf of which the capital acquisition broker provided services permitted under [paragraphs (c)(1) of] Rule 016
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change, as amended by Partial Amendment No. 1, is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-FINRA-2025-005 and should be submitted on or before October 21, 2025.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 11A(a)(3) of the Securities Exchange Act of 1934
On February 28, 2025, the Commission published an order approving a proposed rule change filed by NYSE Chicago, Inc. (the “Exchange”) whereby the Exchange would convert from a Delaware corporation to a Texas corporation and change its name to “NYSE Texas, Inc.”
The foregoing CAT NMS Plan amendment has become effective pursuant to Rule 608(b)(3)(iii)
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the amendment is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
Cboe BZX Exchange, Inc. (the “Exchange” or “BZX”) proposes to introduce a Small Retail Broker Hosted Solutions Program and to update the existing eligibility requirements for the Small Retail Brokerage Distribution Program for the Cboe One Summary Feed. The text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the Exchange's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to adopt a Small Retail Broker Hosted Solutions Program (the “Program”) for Cboe One Summary Data (collectively, the “Applicable Feed”).
Further, the Exchange proposes to increase the allowed maximum Non-Professional Data User subscriber count for the existing Small Retail Broker Program for Cboe One Summary Feed. By way of background, the Exchange currently offers the BZX Top Data Feed, which is a data feed that offers top-of-book quotations and last sale information based on orders entered into the Exchange's System. The BZX Top Data Feed benefits investors by facilitating their prompt access to real-time top-of-book information contained in BZX Top Data. The Exchange's affiliated equities exchanges (
Currently, the Exchange offers a Small Retail Broker Distribution Program
The Exchange now proposes to create a new Program based on the proposed eligibility criteria for Small Retail Brokers to specifically support Small Retail Brokers who are operating platforms on behalf of other Small Retail Brokers. Based on customer feedback, there are Small Retail Brokers who would like to provide this data via a hosted solution as a White Label Service
Of further note, the Hosting Small Retail Broker Distributor is responsible for reporting its External Hosted Subscribers and their users, and ultimately the Hosting Small Retail Broker Distributor is responsible for payment of all data fees for both its
Additionally, given that External Hosted Subscribers are smaller relative to other Small Retail Brokers currently participating in the existing Small Retail Broker Distribution Program, their ability to subscribe to the Applicable Feed as Hosting Small Retail Broker Distributors is likely not feasible. Specifically, the costs of the Applicable Feed may make access to this data impractical. Additionally, the costs associated with building and maintaining the technological infrastructure to receive and disseminate data, may make access to such data impractical. Generally speaking, technology, infrastructure, and connectivity costs are a significant monetary investment and require significant human expertise and resources to maintain. As such, the totality of costs can make access to data difficult. The Exchange believes, though, that the proposed fees and the ability to subscribe to the Applicable Feed as External Hosted Subscribers will make access to data more feasible. Indeed, the Exchange anticipates that the retail broker-dealers that would seek to become External Hosted Subscribers are broker-dealers that do not have the technological infrastructure in place to ingest and disseminate data as a Hosting Small Retail Broker Distributor, and that are likely to have smaller client bases and business models not as conducive to making the investments necessary to become a Hosting Small Retail Broker Distributor.
In these regards, the Exchange believes that the proposed program will incentivize Hosting Small Retail Broker Distributors to offer the Applicable Feed to External Hosted Subscribers, thereby making data accessible to a larger number of broker-dealers and their clients, at an affordable cost. Specifically, under the proposed program, a Hosting Small Retail Broker Distributor providing the data to at least one External Hosted Subscriber would be eligible for a credit of its Distribution Fee (a credit of $3,500/month for Cboe One Summary Feed) that it is normally responsible for under the existing Small Retail Broker Program. Additionally, the External Hosted Subscriber shall also receive a waiver of the Distribution Fee (a credit of $3,500/month for Cboe One Summary Feed). The External Hosted Subscriber will also receive a waiver of the Data Consolidation Fee (a credit of $350/month) and in lieu of paying the Non-Professional User fees, it shall be a set monthly fee $850 for Cboe One Summary Data.
In addition to the changes set forth above, the Exchange also proposes to modify the existing Small Retail Broker Program for Cboe One Summary Feed to increase the number of Non-Professional Data User maximum from 5,000 to 10,000 to be consistent with the proposed threshold for External Hosted Subscribers. As previously discussed, the Exchange proposes to also use the cap of 10,000 Non-Professional Data Users for the proposed Program. The Exchange proposes to increase this in support of increased participation across both retail and investor markets in order to facilitate the growth of smaller retail brokers on a global scale.
As mentioned above, the existing fee structure makes it costly for both Hosting Small Retail Broker Distributors and its External Hosted Subscribers to provide data to the External Hosted Subscribers' retail clients as Distribution Fees are assessed on both Small Retail Brokers. Overall, the Exchange believes that this fee proposal will help to make its data more widely accessible for retail users who receive their data from External Hosted Subscribers. Specifically, the Exchange believes that that this proposal will (i) further increase the competitiveness of the Exchange's top of book market data products compared to competitor offerings that may currently be cheaper for firms with a limited subscriber base that do not yet have the scale to take advantage of the lower subscriber fees offered by the Exchange; and will (ii) provide additional incentives for Hosting Small Retail Broker Distributors to provide hosted solution services for other Small Retail Brokers in order to make data more widely available to retail investors. In turn, the Exchange believes that this change may benefit market participants and investors by spurring additional competition and increasing the accessibility of the Exchange's top of book data.
The Exchange notes that at least one other exchange has a similar offering. For example, the New York Stock Exchange has a Redistribution Fee Waiver for NYSE Trades, for which redistributors of data may have their redistribution fee waived so long as they provide the data to at least one data feed recipient and reports such data feed recipient or recipients to the Exchange.
Without these discounts, a redistributor of NYSE Trades would pay the General Access Fee of $1,500/month in addition to the Redistribution Fee of $1,000/month and the applicable Professional User Fee ($4/month/User) and Non-Professional User Fee ($0.20/month/User).
While the eligibility requirements of the NYSE program and the proposed Program differ, both programs are intended to incentivize redistribution of applicable data feeds by providing enhanced discounts and both programs target different segments for a specific purpose. The proposed discounts under this Program are intended to make the Exchange's offering competitively priced relative to alternative options that participants may have.
Without the proposed pricing discounts, the Exchange believes that (i) prospective customers may not be interested in purchasing top of book data from the Exchange, and may instead purchase such data from other national securities exchanges or the Securities Information Processors (“SIPs”), potentially at a higher cost than would be available pursuant to the proposed program and (ii) that Hosting Small Retail Broker Distributors are not incentivized to make the Applicable Feed available via a hosted solution for retail investors of its External Hosted Subscribers. Similar to the existing Small Retail Broker Program, the Exchange believes that the proposed Program will continue to increase competition for such market data, and that enhanced competition could help to further reduce data fees as providers compete for subscribers, as well as help diversify the availability and quality of data offerings available to retail investors through their Hosting Small Retail Broker Distributors. Ultimately, the Exchange believes that it is critical that it be allowed to compete by offering attractive pricing to customers as increasing the availability of such products ensures continued competition with alternative offerings. Such competition may be constrained when competitors are impeded from offering alternative and cost-effective solutions to customers.
The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,
The Exchange also believes that the proposed rule change is consistent with Section 11(A) of the Act.
In adopting Regulation NMS, the Commission granted SROs and broker-dealers increased authority and flexibility to offer new and unique market data to the public. It was believed that this authority would expand the amount of data available to consumers, and also spur innovation and competition for the provision of market data. The Exchange believes that the proposed fee change would further broaden the availability of U.S. equity market data to investors, and in particular retail investors, consistent with the principles of Regulation NMS.
The Exchange operates in a highly competitive environment. Indeed, there are sixteen registered national securities exchanges that trade U.S. equities and offer associated top of book market data products to their customers. The national securities exchanges also compete with the SIPs for market data customers. The Commission has repeatedly expressed its preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. Specifically, in Regulation NMS, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system “has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.”
Making alternative data products available to market participants ultimately ensures increased
The Exchange notes that the Applicable Feed is distributed and purchased on a voluntary basis, in that neither the Exchange nor market data distributors are required by any rule or regulation to make these data products available. Distributors (including vendors) and Users can therefore discontinue use at any time and for any reason, including due to an assessment of the reasonableness of fees charged. Further, the Exchange is not required to make any proprietary data products available or to offer any specific pricing alternatives to any customers.
The Commission has long stressed the need to ensure that the equities markets are structured in a way that meets the needs of ordinary investors. For example, the Commission's strategic plan for fiscal years 2018-2022 touts “focus on the long-term interests of our Main Street investors” as the Commission's number one strategic goal.
The Exchange notes that the proposed waivers for the Applicable Feed only apply to Hosting Small Retail Broker Distributors and its External Hosted Subscribers for three reasons. First, the Hosting Small Retail Broker Distributor is creating a full-service offering for External Hosted Subscribers in contrast to the Small Retail Brokers under the current Program, which only provide services directly to its own retail clients. Maintaining an additional platform for External Hosted Subscribers' clients is an additional workstream for the Hosting Small Retail Broker Distributors (in contrast to the existing Small Retail Brokers that only provide data and services directly to their retail clients), requiring technological and capital investments, as they seek to support additional ecosystems of business, each with its own book of retail clients. In order to incentivize the Hosting Small Retail Broker Distributors to take on the additional duties associated with hosting External Hosted Subscribers (such as managing the data, entitlements, and display of the application provided to the External Hosted Subscriber), the Exchange believes it is not unfairly discriminatory to provide a waiver of the Distribution Fee for the Hosting Small Retail Broker Distributors, as opposed to the standard discounted Distribution Fee normally paid under the current Small Retail Broker Distribution Program.
Second, by creating this program, the Exchange is further able to reach additional retail investors. By waiving Distribution Fees for both the Hosting Small Retail Broker Distributor and its External Hosted Subscriber, both parties are incentivized to work together to provide data to retail investors. Third, as mentioned previously, the Hosting Small Retail Broker Distributor is responsible for the fees and reporting for both its own activity and that of its External Hosted Subscriber. While the Exchange is not privy to pass-through costs between Hosting Small Retail Broker Distributors and External Hosted Subscribers, this proposed pricing allows Hosting Small Retail Broker Distributors the freedom to charge or not charge External Hosted Subscribers while also appropriately charging for a service provided to an External Hosted Subscriber that is benefitting from an infrastructure developed and supported by the Hosting Small Retail Broker Distributor. The Exchange notes that the current Small Retail Broker Program prevents the Hosting Small Retail Broker Distributor from packaging this waiver as part of their overall service to their External Hosted Subscribers (as External Hosted Subscribers would be billed directly under the existing Small Retail Broker Program). Given that External Hosted Subscribers are smaller relative to other Small Retail Brokers currently participating in the Program, these costs associated with the Applicable Feeds are inherently prohibitive to the External Hosted Subscriber. Through this Program, fees will not be a deterrent for Hosting Small Retail Broker Distributors and External Hosted Subscribers to establish platforms that reach a wider scope of retail investors.
Furthermore, while this Program would be effectively limited to smaller firms in accordance with the proposed eligibility requirements, the Exchange does not believe that this limitation makes the fees inequitable or unfairly discriminatory. The Exchange notes that large broker-dealers and/or vendors that distribute the Exchange's data products to a sizeable number of investors benefit from the current fee structure, which includes lower subscriber fees and Enterprise licenses. Due to lower subscriber fees, distributors that provide the Applicable Feed to more than the proposed capped amounts of Users permitted under either the Small Retail Broker Program or this Program already enjoy cost savings compared to competitor products. The Program, in addition to the existing Small Retail Broker Program, would therefore continue to ensure that small retail brokers that distribute top of book data to their retail investor customers could also benefit from reduced pricing, and would aid in increasing the competitiveness of the Exchange's data products for this key segment of the market.
Moreover, the Exchange does not believe that the proposed fees unfairly discriminate between Hosting Small Retail Broker Distributors and External Hosted Subscribers. While the proposal provides additional benefits to External Hosted Subscribers that would not otherwise accrue to them under the current program, the Exchange notes that such benefits are designed only to make access to market data more accessible to smaller retail broker-dealers that either do not possess the financial and technological resources necessary to receive data as a Small Retail Broker, or simply choose not commit such resourced based on their business models. In turn, to continue to incentivize the provision of the Applicable Feed by Hosting Small Retail Broker Distributors, the Exchange has sought to provide appropriate incentives to these brokers as well. Collectively, the fee structure provides benefits to both Hosting Small Retail Broker Distributors and External Hosted Subscribers.
While External Hosted Subscribers would receive benefits they would not accrue under the current program, these are not benefits that today's Small Retail
Rather, the Exchange believes that the more likely case is that the proposed fee structure will attract a new population of Small Retail Brokers who will seek to access the Applicable Feed as Hosted External Subscribers, at a cost-effective price point, thereby providing even more investors with access to top of book market data for U.S. equities. Another likely use case is that the proposed fee structure may incentivize more Small Retail Brokers to subscribe to the Applicable Feed as External Hosted Subscribers and, as they build their own business models and attract subscribers of their own, eventually commit time and resources to building their own infrastructure to evolve into a Hosting Small Retail Broker.
Furthermore, the Exchange acknowledges that under the proposed fee schedule that a Hosting Small Retail Broker Distributor is eligible for a waiver of its Distribution Fee once its first External Hosted Subscriber is subscribed, whereas under current program a Small Retail Broker is not eligible for such a waiver. However, the Exchange does not believe that this proposed fee structure unfairly discriminates between existing Small Retail Brokers and Hosting Small Retail Brokers, because the application of these fees is based on meaningful differences between existing Small Retail Brokers and potential Hosting Small Retail Broker Distributors.
Specifically, existing Small Retail Brokers are brokers that distribute the Applicable Feed to their own customers. These Small Retail Brokers typically operate their own retail trading businesses, and the provision of the Applicable Feed is part of the package of services provided to their own customers. Comparatively, similar to certain subscribers
Relatedly, the proposed fees are based on the competitive environment for market data products such as the Applicable Feed. In response to competition from other market data feeds such as NYSE BQT, the Exchange's proposed fees are merely intended to provide a financial incentive for vendors/redistributors that do not currently subscribe to any Exchange market data products to subscribe to the Applicable Feed. By focusing on this segment of the market, the Exchange believes that the proposed fees will make the Applicable Feed more competitive and attractive for vendors/redistributors to subscribe to, thereby increasing the availability of the Exchange's data products, expanding the options available to firms making data purchasing decisions on their business needs, and generally increasing competition. In this regard, the Exchange believes that the proposed fees—particularly the waiver of the Distribution Fee—will incentivize Hosting Small Broker Distributors (
Moreover, the Exchange believes that the proposed change to provide a waiver of the Distribution Fee to a Hosting Small Retail Broker Distributor (
Finally, the Exchange notes that nothing in the current proposal prevents an existing Small Retail Broker from choosing to instead subscribe to the Applicable Feed as an External Hosted
The Exchange believes that the Distribution Fee Waivers for both the External Hosted Subscriber and the Hosting Small Retail Broker Distributor are reasonable as they represent a significant cost reduction for the Hosting Small Retail Broker Distributor to provide a hosted solution for the External Hosted Subscriber, to ultimately provide the data to the External Hosted Subscriber's retail investors. By targeting the Distribution Fee waiver to vendors/redistributors that provide external distribution of the Applicable Feeds, the Exchange believes that this would provide an incentive for redistributors to make the Applicable Feeds available to its customers. Specifically, if a data recipient is interested in subscribing to the Applicable Feeds and relies on a vendor/redistributor to obtain market data products from the Exchange, that data customer would need the vendor/redistributor to first subscribe to and distribute the Applicable Feeds. In this regard, the Exchange believes the proposed waiver would provide an incentive for vendors/redistributors to make the Applicable Feeds available to their customers, which will increase the availability of the Applicable Feeds to a larger potential population of retail investors.
While the existing fee structure does provide a benefit of a discounted waiver for Small Retail Brokers that externally distribute the data, the discounted Distribution Fees are still incurred by both the External Hosted Subscriber and the Hosting Small Retail Broker Distributor. In an attempt to alleviate these costs, and make this data more available to retail investors, the Exchange proposes to waive the Distribution Fees for both the Hosting Small Retail Broker Distributor and the External Hosted Subscriber. With this Program, the Exchange believes it will increase market accessibility and data to investors on a global scale. Exchange Hosted Subscribers may not have the infrastructure or technical capabilities to offer market data and/or execution services to its retail investors. Through waiving these fees for the External Hosted Subscriber, the Exchange hopes to reach a broader scale of retail investors globally. Further, as discussed above, the Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber and the Hosting Small Retail Broker Distributor given the development and maintenance the Hosting Small Retail Broker Distributor acquires to provide this data to the External Hosted Subscriber's end users.
The Exchange believes it is reasonable to not charge the External Hosted Subscriber the Data Consolidation Fee for Cboe One Summary Data for the duration of the time that they are eligible for this program. As previously discussed, the waiver of fees for the External Hosted Subscriber is intended to make this data more available to retail investors. The Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber because, as described above, the Exchange believes by alleviating some of the barriers to entry, that Exchange Hosted Subscribers are able to bring this data and execution services to their retail investors. Of further note, the Exchange believes it is reasonable to maintain this cost for the Hosting Small Retail Broker Distributor as the Hosting Small Retail Broker Distributor is the party receiving this data from the Exchange where it is consolidated for the benefit of the Hosting Small Retail Broker Distributor.
The Exchange believes it is reasonable to set a fixed cost for Non-Professional Users fees for External Hosted Subscribers by charging a flat, fixed cost instead of charging per user to allow for additional savings. Under this structure, the External Hosted Subscriber shall still be responsible by paying the standard per User fee of a Professional Users under the Applicable Feed. The Exchange does not believe this is unfairly discriminatory as the program is based around making the Applicable Feed available for Non-Professional Users. The Exchange also notes that it has taken a similar approach here to the NYSE Per User Access Fee, which sets a fixed cost where the data is used only for display purposes.
The Exchange does not believe that the proposed rule change would result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange operates in a highly competitive environment, and its ability to price these data products is constrained by: (i) Competition among exchanges that offer similar data products to their customers; and (ii) the existence of inexpensive real-time consolidated data disseminated by the SIPs. Top of book data is disseminated by both the SIPs and the sixteen equities exchanges. There are therefore a number of alternative products available to market participants and investors. In this competitive environment potential subscribers are free to choose which competing product to purchase to satisfy their need for market information. Often, the choice comes down to price, as broker-dealers or vendors look to purchase the cheapest top of book data product, or quality, as market participants seek to purchase data that represents significant market liquidity. In order to better compete for this segment of the market, the Exchange is proposing to reduce the cost of top of book data provided by Hosting Small Retail Broker Distributors to its External Hosted Subscribers, and in turn, their retail investors. The Exchange believes that this would facilitate greater access to such data, ultimately benefiting the retail investors that are provided access to such market data.
The Exchange also believes the proposed fee changes will better enable it to compete in the Asia Pacific region, which is an area of increasing interest and growth within the U.S. equities markets, generally. As the Asia Pacific investor base seeks access to the liquidity and efficient price discovery processes that exist in the U.S. equities markets, various broker-dealers have begun offering trading in this region, and exchanges have begun to contemplate 24-hour trading solutions designed to capture the increased demand from the Asia Pacific investor base.
The Exchange does not believe that this price reduction would cause any unnecessary or inappropriate burden on intermarket competition as other exchanges and data vendors are free to lower their prices to better compete with the Exchange's offering. Indeed, as explained in the basis section of this proposed rule change, the Exchange's decision to (i) waive the Distribution Fee for the Hosting Small Retail Broker Distributor and the External Hosted Subscriber and (ii) waiving the Consolidation Fee (when applicable) for the External Hosted Subscriber and (iii) setting a fixed cost for the Non-Professional Users for the External Hosted Subscriber is itself a competitive response to different fee structures available on competing markets. The Exchange therefore believes that the proposed rule change is pro-competitive as it seeks to offer pricing incentives to customers to better position the Exchange as it competes to attract additional market data subscribers. The Exchange also believes that the proposed reduction in fees the Hosting Small Retail Broker Distributor and the External Hosted Subscriber would not cause any unnecessary or inappropriate burden on intramarket competition. Although the proposed fee discount would be largely limited to small retail broker subscribers, larger broker-dealers and vendors can already purchase top of book data from the Exchange at prices that represent a significant cost savings when compared to competitor products that combine higher subscriber fees with lower fees for distribution. In light of the benefits already provided to this group of subscribers, the Exchange believes that additional discounts to small retail brokers would increase rather than decrease competition among broker-dealers that participate on the Exchange. Furthermore, as discussed earlier in this proposed rule change, the Exchange believes that offering pricing benefits to brokers that represent retail investors facilitates the Commission's mission of protecting ordinary investors, and is therefore consistent with the Act.
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On September 4, 2025, the Nasdaq Stock Market LLC (“Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange files this proposed rule change to amend the Limited Liability Company Agreement for 24X US Holdings LLC, the parent company of the Exchange, in connection with a warrant performance incentive program. The text of the proposed rule change is available on the Exchange's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange is filing with the Commission a proposed rule change to amend and restate the Second Amended and Restated Limited Liability Company Agreement of 24X US Holdings LLC (the “24X US Holdco LLC Agreement”)
In a separate filing,
To facilitate the Program, which allows Participants to earn the right to purchase Non-Voting Common Units of 24X US Holdco, the Exchange proposes to amend the 24X US Holdco LLC Agreement to allow 24X US Holdco to issue Non-Voting Common Units. 24X US Holdco proposes to sell such Non-Voting Common Units pursuant to an exemption from registration under the Securities Act of 1933. The Exchange proposes to add the following new paragraph (a) to Section III of the 24X US Holdco LLC Agreement:
The Company
Correspondingly, the Exchange proposes to amend
In addition, the Exchange proposes to define the term “Warrant Performance Incentive Program” to mean “that certain program effective as of September 10, 2025 pursuant to which certain members of 24X National Exchange may be eligible to receive warrants to purchase Non-Voting Common Units on terms and conditions as set forth in Securities Exchange Act Release No. 104018 regarding the program, which has been approved by the Manager.” The referenced release is the Warrant Program Release, which describes the terms and conditions of the Program.
The Exchange proposes to add to the 24X US Holdco LLC Agreement a description of the liquidity program applicable to a holder of a Non-Voting Common Unit obtained pursuant to the Program. Specifically, the Exchange proposes to add the following new Section XIII to the 24X US Holdco LLC Agreement:
With respect to any holder of a Non-Voting Common Unit who obtained such Non-Voting Common Unit pursuant to the Warrant Performance Incentive Program, such holder shall have the rights and be subject to the obligations set forth in
The Exchange also proposes to add
Proposed paragraph 1 of
(a) If a Non-Voting Common Unit is a publicly traded security that may be immediately sold in the public markets without any restrictions or limitations, the average, over a period of twenty-one (21) business days consisting of the date of valuation and the twenty (20) consecutive business days prior to that date, of the average of the closing prices of the sales of such securities on the primary securities exchange on which such securities may at that time be
(b) if a Non-Voting Common Unit is not a publicly traded security covered by clause (a), the fair value of a Non-Voting Common Unit, as determined by the Manager of the Company in good faith based on such factors as the Manager, in the exercise of its reasonable business judgment, considers relevant but without taking into account any discounts for lack of liquidity or minority interest or similar discounts; provided, that a Qualifying Participant may, within fifteen (15) business days following its receipt of the Manager's determination of Fair Market Value, direct the Manager to obtain an independent third-party appraisal of the determination, with the determination by the independent appraiser binding on the parties.
Proposed paragraph 1 of
Proposed paragraphs 3 through 7 of
• For 2029 and 2030, each Qualifying Participant may sell up to 10% of its then total Non-Voting Common Units at a price equal to 50% of the Fair Market Value of a Non-Voting Common Unit.
• For 2031, each Qualifying Participant may sell up to 30% of its then total Non-Voting Common Units at a price equal to 60% of the Fair Market Value.
• For 2032, each Qualifying Participant may sell up to 60% of its then total Non-Voting Common Units at a price equal to 70% of the Fair Market Value.
• For 2033, each Qualifying Participant may sell up to 90% of its then total Non-Voting Common Units at a price equal to 80% of the Fair Market Value.
• For 2034, each Qualifying Participant may sell up to 100% of its then total Non-Voting Common Units at a price equal to 90% of the Fair Market Value.
Proposed paragraph 9 of
(i) a Sale of the Company,
Proposed paragraph 9.a of
If there is a Change of Control of the Company, 24X Bermuda Holdings, or 24X National Exchange, the Company has the right to purchase 100% of all Qualifying Participants' Non-Voting Common Units at a price equal to the then applicable percentage of the Fair Market Value of a Non-Voting Common Unit and if the Change of Control occurs after 2034, at 100% of the Fair Market Value of a Non-Voting Common Unit. At least 15 days prior to the expected closing date of the Change of Control, the Company shall provide written notice of its intention to purchase or not to purchase 100% of all Qualifying Participants' Non-Voting Common Units. If the Company indicates its intention to exercise its right to purchase all Non-Voting Common Units, it shall pay in cash the applicable Fair Market Value for each Non-Voting Common Unit on or before the closing of the Change of Control against delivery of all documents as requested by the Company (which may be similar to those executed and delivered in a Sale of the Company) (for the avoidance of doubt, the Company is only obligated to make the payment upon due execution and delivery of all requested documents).
Proposed paragraph 9.b of
If the Company indicates in its written notice that it will not exercise its right to purchase 100% of all Qualifying Participants' Non-Voting Common Units, each Qualifying Participant has 10 days after receipt of notice to indicate in writing to the Company that it wishes to sell to the Company 100% of all such Qualifying Participant's Non-Voting Common Units at a price equal to the then applicable percentage of the Fair Market Value and if the Change of Control occurs after 2034, at 100% of the Fair Market Value of a Non-Voting Common Unit. The Company shall pay in cash the applicable Fair Market Value for each Non-Voting Common Unit on or before the closing of the Change of Control against delivery of all documents as requested by the Company (which may be similar to those executed and delivered in a Sale of the Company) (for the avoidance of doubt, the Company is only obligated to make the payment upon due execution and delivery of all requested documents.
Proposed paragraph (c) of
The Exchange believes that its proposed rule change is consistent with Section 6(b) of the Exchange Act
The Exchange believes that the issuance of the Non-Voting Common Units and other proposed amendments to the 24X US Holdco LLC Agreement related to the Program are consistent with the Act. The proposed changes to the 24X US Holdco LLC Agreement are intended to facilitate the Program, which, as described in the Warrant Program Release,
Furthermore, the proposed liquidity program would balance the needs of Participants and the Exchange, by providing Participants with the early option to sell their Non-Voting Common Units but at a discounted price, depending on the length of time the Non-Voting Common Units are held. In addition, the Exchange does not believe that the proposed liquidity program would be unfairly discriminatory as the liquidity program would be available to Participants in the Program on the same terms and conditions.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Exchange Act. The proposed rule change would authorize the issuance of Non-Voting Common Units as well as the implementation of the early liquidity program for the Program. Accordingly, the Exchange believes that the proposed rule change would facilitate the implementation of the Program described in the Warrant Program Release.
The Exchange neither solicited nor received comments on the proposed rule change.
The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
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 change should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule
• Use the Commission's internet comment form (
• Send an email
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-24X-2025-11 and should be submitted on or before October 21, 2025.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 11A of the Securities Exchange Act of 1934 (“Act”),
The proposed Amendment has been filed by the Participants pursuant to Rule 608(b)(3)(ii) under Regulation NMS
The Commission is publishing this notice to solicit comments on the Amendment from interested persons. Set forth in Sections I and II is the statement of the purpose and summary of the Amendment, along with the information required by Rules 608(a) and 601(a) under the Act, as prepared and submitted by the Participants.
The above-captioned amendment adds 24X as a Participant to the UTP Plan.
Not applicable.
Because the amendment constitutes a “Ministerial Amendment” under Section XVI of the UTP Plan, the Chair of the UTP Plan's Operating Committee may submit the amendment to the Commission on behalf of the Participants in the UTP Plan. Because the Participants designate the amendment as concerned solely with the administration of the UTP Plan, the amendment becomes effective upon filing with the Commission.
Not applicable.
The amendment does not impose any burden on competition because it simply adds 24X as a Participant to the UTP Plan. 24X has completed the required steps to be added to the UTP Plan.
Not applicable.
See Item 3 above.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Not applicable.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed Amendment is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
Cboe BZX Exchange, Inc. (“BZX” or the “Exchange”) proposes to update Rule 11.26(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the planned operation of the 24X National Exchange LLC (“24X Exchange”) as a registered national securities exchange
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to update Rule 11.26(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the operation of the 24X Exchange as a registered national securities exchange.
On November 27, 2024, the Commission approved 24X Exchange's application to register as a national securities exchange.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,
The Exchange believes that its proposal to update Exchange Rule 11.26(a) to include 24X Exchange will ensure that the Rule publicly states on a market-by-market basis all of the specific network processor and proprietary data feeds that the Exchange utilizes for the handling, routing, and execution of orders, and for performing the regulatory compliance checks related to each of those functions. The proposed rule change also removes impediments to and perfects the mechanism of a free and open market and protects investors and the public interest because it provides additional specificity, clarity and transparency.
The Exchange believes its proposed rule change would not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, the Exchange believes the proposal would enhance competition because including all of the exchanges enhances transparency and enables investors to better assess the quality of the Exchange's execution and routing services.
The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from Members or other interested parties.
Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act
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 will institute proceedings to determine whether the proposed rule change should be approved or disapproved.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Cboe EDGX Exchange, Inc. (the “Exchange” or “EDGX”) is filing with the Securities and Exchange Commission (the “Commission”) a proposed rule change to amend its Fees Schedule to remove obsolete text regarding the assessment of late fees. Specifically, the Exchange proposes to eliminate from its Fee Schedule text indicating that a charge of 1% per month will be assessed on past due portions of Members' accounts and accompanying text describing the terms of the assessment of such late fees. The text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to amend its Fees Schedule to remove obsolete text regarding the assessment of late fees. Specifically, the Exchange proposes to eliminate from its fee schedule text indicating that a charge of 1% per month will be assessed on past due portions of a Member's
By way of background, the Exchange's fee schedule historically included language regarding the assessment of late fees. The Exchange's fee schedule indicated that a 1% per month charge on past due portions of Members' balances would be assessed. Further, the Exchange's fee schedule described the terms of the assessment of such late fees including that the fees would accrue on a daily basis and that the fees would be included as line items on a Member's invoices as they are assessed. Moreover, Exchange Rule 15.1(a) states that the Exchange may prescribe such reasonable dues, fees, assessments or other charges as it may, in the Exchange's discretion, deem appropriate.
The inclusion of late fees on the Exchange's fee schedule was originally intended to incentivize Members to timely pay invoices.
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the “Act”) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
The Exchange believes that its proposed fee schedule amendment is reasonable because it is designed to align the Exchange's fee schedule with its actual billing practices. As discussed above, the Exchange does not assess late fees on a Member's accounts. Because the proposed amendment aligns the Exchange's fee schedule with the services currently provided by the Exchange by removing obsolete language and eliminating (rather than
The Exchange believes the proposal to remove language regarding the assessment of late fees from its fee schedule is equitable and not unfairly discriminatory because it applies uniformly to all Members of the exchange and all market participants will have further clarity as to whether the Exchange assesses late fees. The proposed amendment to eliminate language relating to the assessment late fees applies equally to all of the Exchange's Members and other persons using or seeking to use its facilities. As such, the proposed amendment is non-discriminatory. Additionally, the Exchange believes that by eliminating language regarding the assessment of late fees, the proposed amendment will promote market transparency by accurately reflecting the Exchange's current policy regarding the assessment of late fees. The Exchange also believes the proposed amendment will provide clarity to its Members and other market participants by accurately describing the manner in which the Exchange assesses fees. As such, the Exchange believes the proposed rule amendment is equitable.
The Exchange notes that it is not statutorily required to assess late fees on the past due balances of its Members. The Exchange seeks to align the language in its fee schedule with the current billing practices of the Exchange. The Exchange believes that Members would benefit from clear guidance in its fee schedule that accurately describes the manner in which the Exchange assesses fees. The proposed fee schedule amendment is intended to make the fee schedule clearer and less confusing for Members and eliminate potential confusion, thereby removing impediments to and perfecting the mechanism of a free and open market and a national market system, and, in general, protecting investors and the public interest.
The Exchange does not believe that the proposed amendment will impose any burden on intramarket or intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed amendment will impose any burden on intramarket competition because the proposed change applies uniformly to all market participants.
As discussed above, the proposed amendment seeks to align the Exchange's fee schedule with the current practices of the Exchange. The Exchange does not believe that the proposed amendment will impose any burden on intermarket competition because the Exchanges current practices regarding the assessment of late fees is similar to practices of other exchanges. Based on a review of other exchanges' fee schedules, the Exchange is currently unaware of any late fees or charges assessed by competitor exchanges such as NASDAQ Stock Market LLC (“NASDAQ”) and MIAX Pearl LLC (“MIAX). Like the Exchange, NASDAQ and MIAX retain the ability to prescribe reasonable dues, fees, assessments or other charges as they may deem appropriate.
Additionally, the Exchange does not believe that the proposed amendment creates an undue burden on competition because the Exchange will continue to assess all other fees upon its Members as described in its fee schedule and Rulebook. Further, the Exchange is currently unaware of any late fees or charges assessed by competitor exchanges such as NASDAQ and MIAX. Accordingly, the Exchange does not believe its proposed fee schedule amendment imposes any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to amend various port fees in the Connectivity Fee Schedule. The proposed rule change is available on the Exchange's website at
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.
The Exchange proposes to amend the Connectivity Fee Schedule to make changes to the monthly recurring fees that Users
The Exchange currently provides ports (also referred to as “connections” and “network access”) to Users in the colocation halls of the MDC at the prices shown below. With this proposal, the Exchange proposes to increase its monthly recurring fees for these ports by amounts between 9.1% to 11.1% (the initial port charges would not change). As proposed, Users would be charged the following adjusted prices:
The proposed port fee increases would enable the Exchange to maintain and improve its market technology and services to remain competitive with its peers. Over the years, customer demand for more sophisticated, higher-throughput, lower-latency, and higher-power connectivity solutions has increased. The Exchange continues to invest in maintaining, improving, and enhancing its connectivity products, services, and facilities for the benefit and often at the behest of its customers. Such enhancements include refreshing hardware and
As discussed below, the Exchange proposes to adjust its fees by an industry- and product-specific inflationary measure. It is reasonable and consistent with the Act for the Exchange to recoup its investments, at least in part, by adjusting its fees. Continuing to operate at fees frozen at 2017 levels impacts the Exchange's ability to enhance its offerings and the interests of market participants and investors.
The fee increases the Exchange proposes are based on an industry-specific Producer Price Index (“PPI”), which is a tailored measure of inflation.
For purposes of this proposal, the relevant industry-specific PPI is the Data Processing and Related Services PPI (“Data PPI”), which is an industry net-output PPI that measures the average change in selling prices received by companies that provide data processing services.
The Data PPI was introduced in January 2002 by the Bureau of Labor Statistics (BLS) as part of an ongoing effort to expand Producer Price Index coverage of the services sector of the U.S. economy and is identified as NAICS 518210 in the North American Industry Classification System.
The Exchange believes the Data PPI is an appropriate measure to be considered in the context of the proposed rule change to modify its port fees because the Exchange uses its “own computer systems” and “proprietary software,”
For purposes of this proposed rule change, the Exchange examined the Data PPI value for the period from January 2017 through March 2025 (the last month for which finalized data is available). The Data PPI had a starting value of 109.0 in January 2017 and an ending value of 121.880 in March 2025, an 11.82% increase. This indicates that companies who are also in the data storage and processing business have generally increased prices for a specified service covered under NAICS 518210 by an average of 11.82% during this period. Based on that percentage change, the Exchange proposes to increase its monthly recurring fees for the ports in the colocation halls of the MDC by up to 11.1%—slightly below the Data PPI increase of 11.82%—which reflects an increase covering the entire period since the last price adjustment to these fees was made.
The Exchange further believes the Data PPI is an appropriate measure for purposes of the proposed rule change on the basis that it is a stable metric with limited volatility, unlike other consumer-side inflation metrics. In fact, the Data PPI has not experienced a greater than 3.00% increase for any one calendar year period since 2004, the earliest Data PPI is available. The average calendar year change from 2004 to 2025 was 0.76%, with a cumulative increase of 17.15% over this 21-year period. The Exchange believes the Data PPI is considerably less volatile than other inflation metrics such as CPI, which has had individual calendar-year increases averaging 2.62%, and a cumulative increase of 71.53% during the same period.
The Exchange believes the Data PPI, and significant investments into, and enhanced performance of, the Exchange support the reasonableness of the proposed fee increases.
These proposed fee increases will be immediately effective upon filing. However, the Exchange proposes to delay the operative date of such changes until January 1, 2026, to give sufficient notice to market participants.
The Exchange believes the proposed rule change is consistent with the provisions of Section 6 of the Act,
This belief is based on two factors. First, the current fees do not properly reflect the quality of the services and
As noted above, the Exchange has not increased any of the fees included in the proposal since 2017 or earlier. However, in the years following the last fee increases, the Exchange has made significant investments in upgrades to its connectivity products, services, and facilities, enhancing the quality of its services. In other words, Exchange customers have greatly benefited, while the Exchange's ability to recoup its investments has been hampered.
Between 2017 and 2025, the inflation rate was 3.51% per year, on average, producing a cumulative inflation rate of 31.79%.
Notwithstanding inflation, as noted above, the Exchange has not increased its fees for the subject services for more than eight years. The proposed fee changes therefore represent a modest increase from the current fees.
The Exchange believes the proposed fee increase is reasonable in light of the Exchange's continued expenditure in maintaining a robust technology ecosystem. Furthermore, the Exchange continues to invest in maintaining and enhancing its connectivity products—for the benefit and often at the behest of its customers and global investors. Such enhancements include refreshing several aspects of the technology ecosystem including software, hardware, and network while introducing new and innovative products and expanded and modernized facilities. The goal of the enhancements discussed above, among other things, is to provide faster, higher-capacity, and more modern connectivity products and services. Accordingly, the Exchange continues to expend resources to innovate and modernize its technology so that it may benefit its members in offering connectivity products and services.
The Exchange believes that the proposed fee increases are equitably allocated and not unfairly discriminatory because they would apply to all market participants that choose to purchase such connectivity products and services from the Exchange. Any participant that chooses to purchase the Exchange's connectivity products and services would be subject to the same Connectivity Fee Schedule, regardless of what type of business they operate or the use they plan to make of the products and services. Additionally, the fee increases would be applied uniformly to market participants without regard to Exchange membership status or the extent of any other business with the Exchange or affiliated entities.
The Exchange also believes that the proposal represents an equitable allocation of reasonable dues, fees, and other charges because Exchange fees have fallen in real terms during the relevant period. Finally, the Exchange believes that the proposed fee changes are not unfairly discriminatory because the fees would be assessed uniformly across all market participants, in the same manner they are today, that voluntarily purchase the Exchange's connectivity products and services, which would remain available for purchase by all market participants.
The Exchange does not believe that the proposed fees will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
No written comments were solicited or received with respect to the proposed rule change.
Pursuant to Section 19(b)(3)(A)(ii) of the Act,
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to amend the fees for Nasdaq 100® Index options in the Exchange's Pricing Schedule at Options 7, Section 5.A.
While the changes proposed herein are effective upon filing, the Exchange has designated the amendments become operative on October 1, 2025.
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
This proposal amends the fees for the Nasdaq 100® Index (“NDX”)
As set forth in Options 7, Section 5.A, the Exchange currently charges all Non-Customer
The Exchange now proposes to increase the Customer pricing in NDX and NDXP from $0.25 to $0.50 per contract for electronic simple and complex executions as well as floor transactions. Customers will continue to be assessed a lower fee as compared to Non-Customers. While the Exchange is increasing the fee, the Exchange believes that a Customer fee of $0.50 per contract will continue to attract order flow to the Exchange.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The Exchange believes that its proposal to increase the Customer pricing in NDX and NDXP from $0.25 to $0.50 per contract for electronic simple and complex executions as well as floor transactions is reasonable because Customers will continue to be assessed a lower fee as compared to Non-Customers. While the Exchange is increasing the fee, the Exchange believes that a Customer fee of $0.50 per contract will continue to attract order flow to the Exchange. Pricing by symbol is a common practice on many U.S. options exchanges as a means to incentivize order flow to be sent to an exchange for execution in particular products. The Exchange notes that market participants are offered different ways to gain exposure to the Nasdaq 100 Index, whether through the Exchange's proprietary products like options overlying NDX or XND, or separately through multi-listed options overlying Invesco QQQ Trust (“QQQ”).
The Exchange believes that its proposal is equitable and not unfairly discriminatory because it will be applied uniformly to all Customers. Assessing a lower fee to Customers as compared to Non-Customers is equitable
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
In terms of intra-market competition, the Exchange will apply the proposed surcharge uniformly to all Customers. Assessing a lower fee to Customers as compared to Non-Customers does not impose an undue burden on competition because Customer liquidity benefits all market participants by providing more trading opportunities, which attracts market makers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants, to the benefit of all market participants who may interact with the order flow.
In terms of inter-market competition, the Exchange 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, or rebate opportunities available at other venues to be more favorable. In such an environment, the Exchange must continually adjust its fees to remain competitive with other options exchanges. Because competitors are free to modify their own fees in response, and because market participants may readily adjust their order routing practices, the Exchange believes that the degree to which fee changes in this market may impose any burden on competition is extremely limited. As noted above, market participants are offered an opportunity to transact in NDX, NDXP, or XND, or separately execute options overlying QQQ. Offering these products provides market participants with a variety of choices in selecting the product they desire to use to gain exposure to the Nasdaq 100 Index.
In addition to the Exchange, market participants have alternative options exchanges that they may participate on and direct their order flow, which list proprietary products that compete with NDX and NDXP.
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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: (i) necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) 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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange, pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of this proposed rule change is to amend Rule General 7, Section 3 of the CAT Compliance Rule to be consistent with the amendment to the CAT NMS Plan related to the BFMM Locate Exception. In 2023, the Commission amended the CAT NMS Plan to require the reporting to the CAT of reliance on the BFMM Locate Exception.
Accordingly, the Exchange proposes to amend its CAT Compliance Rule to reflect this additional CAT reporting requirement. Specifically, the Exchange proposes to add paragraph (G) to Rule General 7, Section 3(a)(2), which would require each Industry Member to record and report to the Central Repository the following:
The Exchange believes that the proposed rule change is consistent with the provisions of Section 6(b)(5) of the Act
The Exchange believes that this proposal is consistent with the Act because it is consistent with the amendment to the CAT NMS Plan approved by the Commission and is designed to assist the Exchange and its Industry Members in meeting regulatory obligations pursuant to the Plan. In approving the Plan, the SEC noted that the Plan “is necessary and appropriate in the public interest, for the protection of investors and the maintenance of fair and orderly markets, to remove impediments to, and perfect the mechanism of a national market system, or is otherwise in furtherance of the purposes of the Act.”
The Exchange 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 Exchange Act. The Exchange notes that the proposed rule change is consistent with the amendment to the CAT NMS Plan approved by the Commission and is designed to assist the Exchange in meeting its regulatory obligations pursuant to the Plan. The Exchange also notes that the amendment to the CAT Compliance Rule will apply equally to all Industry Members that trade equity securities. In addition, all national securities exchanges and FINRA are proposing these amendments to their CAT Compliance Rules. Therefore, this is not a competitive rule filing, and, therefore, it does not impose a burden on competition.
No written comments were either solicited or received.
Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-NASDAQ-2025-076. 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 (
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On August 5, 2025, New York Stock Exchange LLC, NYSE American LLC, NYSE Texas, Inc., and on August 15, 2025, NYSE Arca, Inc., (collectively, the “Exchanges”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule changes so that it has sufficient time to consider the proposed rule changes and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
September 26, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The proposed rule change consists of amendments to the FICC Government Securities Division (“GSD”) Rulebook (“Rules”)
In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to amend the Rules to (i) add the ACS Triparty Service that would allow an Agent Clearing Member to submit to FICC for Novation Repo Transactions on securities represented by Generic CUSIP Numbers and held under a triparty custodial arrangement, (ii) align how the Rules treat Initial Haircuts and Start Legs under done-with Agent Clearing Transactions with the treatment applicable to done-with Sponsored Member Trades, and (iii) make certain conforming and clarifying changes.
In 2024, FICC renamed and consolidated its existing correspondent clearing/prime broker services into a single “Agent Clearing Service.”
The Agent Clearing Service aims to allow indirect participants to access FICC's clearance and settlement systems using a model that is similar in many respects to the agent clearing model through which market participants clear U.S. futures and cleared derivatives.
The Agent Clearing Service is one of FICC's two principal indirect participant access models. The other is FICC's Sponsored Service. Under that service, a Netting Member of FICC (in such capacity, a “Sponsoring Member”) may sponsor into limited membership its customer (a “Sponsored Member”) and submit for comparison, Novation, and netting certain transactions entered into by the Sponsored Member (each, a “Sponsored Member Trade”). Similar to the Agent Clearing Service, the Sponsoring Member acts as processing agent for its Sponsored Members in relation to their Sponsored Member Trades and guarantees to FICC the Sponsored Member's obligations under such transactions.
The Sponsored Service and Agent Clearing Service share a number of similarities. However, there are certain aspects in which the Agent Clearing Service and the Sponsored Service differ. These include the scope of transactions eligible to be cleared, the treatment of haircuts, and the Novation of Start Legs, each as further described below.
While the Agent Clearing Service supports cash transactions and Repo Transactions that settle through FICC on a delivery-versus-payment basis (“DVP Repo Transactions”), it does not support Repo Transactions on securities represented by Generic CUSIP Numbers that settle through a clearing agent bank's triparty repo platform (“Triparty Trades”). By contrast, the Sponsored Service supports not only DVP Repo Transactions (“DVP Sponsored Member Trades”) and cash transactions, but also Triparty Trades between a Sponsored Member and its Sponsoring Member (“Sponsored GC Trades”).
The Sponsored GC Service contains a number of features that facilitate the ability of certain indirect participants to access FICC's clearance and settlement services and Sponsoring Members to provide such access. Of particular note, under the Sponsored GC Service, the securities delivery and related payment obligations under Sponsored GC Trades settle directly between the pre-Novation counterparties to the trades through a Sponsored GC Clearing Agent Bank's triparty repo platform, rather than through FICC.
Another difference between the Sponsored Service and the Agent Clearing Service concerns Initial Haircuts. FICC understands from its engagement with market participants that many cash providers require the value of the Purchased Securities to exceed the purchase price for such securities (
However, since FICC does not collect margin in relation to any Initial Haircuts, transactions with Initial Haircuts are considered Off-the-Market Transactions. As a result, in the event a Sponsored Member has posted an Initial Haircut under a Sponsored Member Trade, it would bear the risk of loss of such Initial Haircut in the event FICC ceased to act for the Sponsored Member's pre-Novation counterparty (or its Sponsoring Member or Agent Clearing Member, as applicable).
The Rules governing the Agent Clearing Service do not currently address the treatment of Initial Haircuts under Agent Clearing Transactions. As a result, the way the Collateral Mark is calculated for Agent Clearing Transactions currently serves to cause any Initial Haircut under such transactions to be passed back to the
Another area in respect of which the Agent Clearing Service and Sponsored Service differ concerns FICC's Same-Day Settling Trades service (“Same-Day Settling Service”). In 2021, FICC amended its Rules to provide for FICC to Novate the Start Legs of many same-day starting Repo Transactions pursuant to FICC's Same-Day Settling Service.
Unlike under the Sponsored Service, the Rules provide for FICC to Novate the Start Legs of done-with Repo Transactions submitted via the Agent Clearing Service. However, FICC understands from its engagement with market participants that similar considerations to those discussed above also apply to Executing Firm Customers and their Agent Clearing Members.
FICC proposes to create the ACS Triparty Service as a new offering under the Agent Clearing Service. The ACS Triparty Service would allow an Agent Clearing Member to submit to FICC for comparison and Novation triparty Repo Transactions entered into by an Executing Firm Customer involving securities represented by Generic CUSIP Numbers (each, an “ACS Triparty Trade”). The ACS Triparty Service would accommodate both transactions between an Executing Firm Customer and its Agent Clearing Member (
FICC proposes that the ACS Triparty Service leverage much of the legal and operational framework applicable to the existing Sponsored GC Service. As a result, the terms of the ACS Triparty Service would be substantially similar to those of the Sponsored GC Service, including that:
• Only the End Leg of Repo Transactions would be eligible for Novation in connection with the ACS Triparty Service;
• The Start Leg of an ACS Triparty Trade would settle on a gross (
• FICC would only Novate the ACS Triparty Trade if the Start Leg has settled and the other conditions applicable under the Sponsored GC Service are satisfied;
• The schedule of eligible securities for the ACS Triparty Service would be identical to the schedule of eligible securities for the Sponsored GC Service;
• An ACS Triparty Trade may, but would not be required to, have an Initial Haircut;
• Accrued repo interest on ACS Triparty Trades would be payable by or to by FICC on a daily basis, and the repo seller (the “ACS Triparty Funds Borrower”) would be permitted to substitute GC Comparable Securities and/or cash for the purchased securities subject to the ACS Triparty Trades (“Purchased ACS Triparty Repo Securities”);
• The transfer of Purchased ACS Triparty Repo Securities in connection with final settlement of an ACS Triparty Trade as well as daily repo interest and any margin calls related to the mark-to-market movement of Purchased ACS Triparty Repo Securities would be made directly between the pre-Novation counterparties through the triparty repo platform of an ACS Triparty Clearing Agent Bank;
• The only Funds-Only Settlement Amounts that would be payable in respect of ACS Triparty Trades would be a Forward Mark Adjustment Payment and Interest Rate Adjustment Payment; and
• ACS Triparty Trades would be treated as GCF Repo Transactions for purposes of calculating initial margin requirements.
FICC would record ACS Triparty Trades in an Agent Clearing Member Omnibus Account, alongside other Agent Clearing Transactions. As a result, unless the Executing Firm Customer and the Agent Clearing Member elect for the ACS Triparty Trades to be recorded in a Segregated Indirect Participants Account, ACS Triparty Trades recorded in the same Agent Clearing Member Omnibus Account (or Margin Portfolio of multiple Agent Clearing Member Omnibus Accounts) would be margined in a way that recognizes the risk offsets across all positions recorded in such account or portfolio. In addition, consistent with recent changes FICC has proposed to the Sponsored GC Service, the ACS Triparty Service would accommodate not only done-with Repo Transactions, but also done-away ones.
As described above, FICC understands that the features leveraged from the Sponsored GC Service, including in particular the limited Funds-Only Settlement Amounts and the settlement of securities delivery and related payment obligations through the ACS Triparty Clearing Agent Bank's triparty repo platform, can facilitate the ability of certain indirect participants to engage in cleared transactions and of direct participants to provide clearing services. In particular, these features would make it easier for money market funds and other cash providers that “depend on transfers of securities to maintain required margin, and typically rely on a tri-party repo clearing bank to administer the collateral management” to access FICC's clearance and settlement services and for clearing
As noted above, ACS Triparty Trades would be treated as GCF Repo Transactions for purposes of calculating initial margin requirements. FICC is not proposing changes to the calculation of the Required Fund Deposit or Segregated Customer Margin in connection with the proposed ACS Triparty Service. ACS Triparty Trades that are recorded in an Agent Clearing Member Omnibus Account or a Segregated Indirect Participants Account would be subject to all applicable charges, pursuant to the Margin Component Schedule of the Rules, as Agent Clearing Transactions recorded in the same Account.
FICC would propose to exclude ACS Triparty Trades from a provision that is being proposed to be added to Rule 8 under a separate proposed rule change filing (the “Default Management Proposal”).
Further, the proposed ACS Triparty Service would not present any additional or new liquidity risks to FICC. FICC would incorporate ACS Triparty Trades into its liquidity risk management calculations and into the calculation of Agent Clearing Members' obligations with respect to the Capped Contingency Liquidity Facility (“CCLF”), as set forth in Section 2a(b) of Rule 22A, using the same methodology, logic and parameters that FICC uses with respect to Sponsored GC Trades.
To implement the proposed changes described above, FICC proposes to make the following amendments to its Rules.
“ACS Triparty Clearing Agent Bank” would mean a Clearing Agent Bank that has agreed to provide FICC, upon request, under mutually agreeable terms, with clearing services for ACS Triparty Trades.
“ACS Triparty Collateral Return Entitlement” would mean the entitlement of a Netting Member or its Indirect Participant to receive the Purchased ACS Triparty Repo Securities in exchange for cash at the End Leg of an ACS Triparty Trade.
“ACS Triparty Collateral Return Obligation” would mean the obligation of a Netting Member or its Indirect Participant to deliver the Purchased ACS Triparty Repo Securities in exchange for cash at the End Leg of an ACS Triparty Trade.
“ACS Triparty Funds Borrower” would mean a Netting Member or its Indirect Participant that has an ACS Triparty Collateral Return Entitlement and associated cash payment obligation. If the ACS Triparty Funds Borrower is an Executing Firm Customer, then, following Novation of the relevant ACS Triparty Trade, the term ACS Triparty Funds Borrower shall refer to the Agent Clearing Member on behalf of the Executing Firm Customer.
“ACS Triparty Funds Lender” would mean a Netting Member or its Indirect Participant that has an ACS Triparty Collateral Return Obligation and associated cash payment entitlement. If the ACS Triparty Funds Lender is an Executing Firm Customer, then, following Novation of the relevant ACS Triparty Trade, the term ACS Triparty Funds Lender shall refer to the Agent Clearing Member on behalf of the Executing Firm Customer.
“ACS Triparty Repo Security” would mean an Eligible Security that is only eligible for submission to FICC in connection with the comparison and Novation of ACS Triparty Trades.
“ACS Triparty Service” would mean the service offered by FICC to clear triparty repurchase agreement transactions between an Executing Firm Customer and either its Agent Clearing Member or another Netting Member or Indirect Participant as described in Rule 8.
“ACS Triparty Trade” would mean, in connection with the ACS Triparty Service, an Agent Clearing Transaction that is a Repo Transaction between an Executing Firm Customer and a Netting Member or its Indirect Participant involving securities represented by a Generic CUSIP Number the data on which are submitted to FICC by the Agent Clearing Member pursuant to the provisions of Rule 6A, for Novation to FICC pursuant to Section 8(a)(ii) of Rule 8.
“Purchased ACS Triparty Repo Securities” would mean the ACS Triparty Repo Securities transferred by the ACS Triparty Funds Borrower in settlement of the Start Leg of an ACS Triparty Trade, plus all cash and other ACS Triparty Repo Securities transferred by such ACS Triparty Funds Borrower pursuant to Sections 8(b)(ii) and (v) of Rule 8, less any ACS Triparty Repo Securities or cash received by the ACS Triparty Funds Borrower pursuant to Sections 8(b)(iii) and (v) of Rule 8.
FICC would revise the definition of “Start Leg” so that, in the context of an ACS Triparty Trade, it refers to the initial settlement aspects of the
FICC would revise the definition of “End Leg” so that, in the context of an ACS Triparty Trade, it refers to the concluding settlement aspects of the Transaction, involving the retransfer of the Purchased ACS Triparty Repo Securities by the ACS Triparty Funds Lender and the taking back of such Purchased ACS Triparty Repo Securities by the ACS Triparty Funds Borrower.
FICC would revise the definitions of “Current Net Settlement Positions,” “Eligible Security,” “Forward Mark Adjustment Payment,” “GC Comparable Securities,” “GC Daily Repo Interest,” “GC Interest Rate Mark,” “GC Start Leg Market Value,” “General Collateral Repo Transaction,” “Generic CUSIP Number,” and “Interest Adjustment Payment” by adding references to ACS Triparty Trades.
FICC would revise Section 4 of Rule 8 to provide that an Agent Clearing Member may submit to FICC ACS Triparty Trades on behalf of Executing Firm Customers and that such transactions constitute Agent Clearing Transactions for purposes of the Rules.
FICC would revise Section 7 of Rule 8 to describe the extent to which FICC's existing processing rules for Agent Clearing Transactions apply to ACS Triparty Trades. Specifically, FICC would revise Section 7(b) of Rule 8 to clarify that ACS Triparty Trades shall be processed and netted in the same manner as other Agent Clearing Transactions unless otherwise specifically stated in Rule 8. FICC would also revise the new Section 7(e) of Rule 8 (former Section 7(d) of Rule 8),
FICC would also revise new Section 7(i) of Rule 8 (former Section 7(g) of Rule 8) to describe how FICC would determine the initial margin requirements for ACS Triparty Trades. By virtue of the revisions, new Section 7(i) would provide that, for purposes of the application of Rule 4 to an Agent Clearing Member Omnibus Account, each ACS Triparty Trade shall be treated as a GCF Repo Transaction, each ACS Triparty Funds Lender and ACS Triparty Funds Borrower shall be treated as a GCF Counterparty, and each ACS Triparty Clearing Agent Bank shall be treated as a GCF Clearing Agent Bank.
FICC would add a new Section 8 of Rule 8 to set forth the various terms specific to ACS Triparty Trades, which would closely mirror the rules applicable to Sponsored GC Trades set forth in Sections 7(b), 8(b), and 9(b) of Rule 3A. As described more fully below, new Section 8(a) of Rule 8 would describe how ACS Triparty Trades would be processed through GSD's Netting System and would be Novated by FICC, the new Section 8(b) of Rule 8 would describe securities settlement for ACS Triparty Transactions, and the new Section 8(c) of Rule 8 would describe funds-only settlement for the ACS Triparty Service. Each of these new sections of Rule 8 would mirror, with no substantive differences, Section 7(b) of Rule 3A (addressing netting and Novation of Sponsored GC Trades), Section 8(b) of Rule 3A (addressing securities settlement of Sponsored GC Trades), and Section 9(b) (addressing Funds-Only Settlement Amounts applicable to Sponsored GC Trades).
Paragraph (a)(i) of the new Section 8 of Rule 8 would provide that, as with Sponsored GC Trades,
Paragraph (a)(ii) of new Section 8 of Rule 8 would set forth the requirements that would need to be satisfied in order for an ACS Triparty Trade to be novated on a given Business Day. These requirements, which are the same as those as apply to Sponsored GC Trades,
• the trade data on the ACS Triparty Trade must have been submitted to FICC by the Agent Clearing Member pursuant to Rule 6A by the deadline set forth in FICC's proposed new Schedule of ACS Triparty Trade Timeframes,
• the data on the ACS Triparty Trade must have been compared in the Comparison System pursuant to Rule 6A,
• the Start Leg of the ACS Triparty Trade must have fully settled at the ACS Triparty Clearing Agent Bank by the deadline set forth in FICC's proposed new Schedule of ACS Triparty Trade Timeframes,
• the ACS Triparty Clearing Agent Bank must have, pursuant to communications links, formats, timeframes, and deadlines established by FICC for such purpose, provided to FICC a report containing such data as FICC may require from time to time, including information regarding the specific ACS Triparty Repo Securities that were delivered in settlement of the Start Leg of the ACS Triparty Trade, and
• FICC must determine that the data contained in such report matches the data on the ACS Triparty Trade submitted by the Agent Clearing Member pursuant to Rule 6A.
Paragraph (a)(iii) of new Section 8 of Rule 8 would state that, as with Sponsored GC Trades,
Paragraph (a)(iv) of new Section 8 of Rule 8 would require that each Agent Clearing Member, on its own behalf and on behalf of each Executing Firm Customer, acknowledges and agrees that it has authorized each relevant ACS Triparty Clearing Agent Bank to provide FICC with all information and data as FICC may require or request from time to time in order to novate and process ACS Triparty Trades. This requirement is similar to Section 7(b)(iv) of Rule 3A, which requires each relevant Sponsoring Member and Sponsored Member to acknowledge and agree that it has authorized each relevant Sponsored GC Clearing Agent Bank to provide FICC with all information and data as FICC may require or request from time to time in order to novate and process Sponsored GC Trades.
Paragraph (b)(i) of new Section 8 of Rule 8 would state that an ACS Triparty Funds Lender and ACS Triparty Funds Borrower must satisfy their ACS Triparty Collateral Return Obligations and cash payment obligations associated with ACS Triparty Collateral Return Entitlements, respectively, within the timeframes established for such by FICC in the proposed Schedule of ACS Triparty Trade Timeframes. In addition, any failure by the ACS Triparty Funds Borrower to satisfy its cash payment obligations associated with ACS Triparty Collateral Return Entitlements within the timeframe established for such by FICC in the Schedule of ACS Triparty Trade Timeframes would subject it to a late fee as if such ACS
Paragraphs (b)(ii) and (iii) of new Section 8 of Rule 8 would set forth the terms under which FICC would risk manage the mark-to-market movement of Purchased GC Securities. These terms would be substantially the same as those set forth in Sections 8(b)(ii) and (iii) of Rule 3A applicable to Sponsored GC Trades. In particular, paragraph (b)(ii) of new Section 8 of Rule 8 would state that if on any Business Day, the market value of an ACS Triparty Funds Borrower's ACS Triparty Collateral Return Entitlement from the previous Business Day (or the current Business Day) is less than the GC Start Leg Market Value, then such ACS Triparty Funds Borrower shall deliver to FICC (and FICC shall deliver to the relevant ACS Triparty Funds Lender) additional GC Comparable Securities and/or cash, such that the market value of the ACS Triparty Funds Borrower's ACS Triparty Collateral Return Entitlement (and the market value of the relevant ACS Triparty Funds Lender's ACS Triparty Collateral Return Obligation) is at least equal to the GC Start Leg Market Value. Such additional securities and/or cash would need to be delivered by the ACS Triparty Funds Borrower within the timeframe set forth in the Schedule of ACS Triparty Trade Timeframes.
Paragraph (b)(iii) of new Section 8 of Rule 8 would state that if on any Business Day, the market value of an ACS Triparty Funds Lender's ACS Triparty Collateral Return Obligation from the previous Business Day (or the current Business Day) is greater than the GC Start Leg Market Value, then such ACS Triparty Funds Lender shall deliver to FICC (and FICC shall deliver to the relevant ACS Triparty Funds Borrower) some of the Purchased ACS Triparty Repo Securities, such that the market value of the ACS Triparty Funds Lender's ACS Triparty Collateral Return Obligation (and the market value of the relevant ACS Triparty Funds Borrower's ACS Triparty Collateral Return Entitlement) is not more than the GC Start Leg Market Value. Such Purchased ACS Triparty Repo Securities must be delivered within the timeframe set forth in the Schedule of ACS Triparty Trade Timeframes. In connection with this proposed change, FICC is proposing to make a conforming and clarifying change to Section 8(b)(iii) of Rule 3A, applicable to the Sponsored GC Service.
Paragraph (b)(iv) of new Section 8 of Rule 8 would state that, as under Sponsored GC Trades,
Paragraph (b)(v) of new Section 8 of Rule 8 would state that, as under Sponsored GC Trades,
Paragraph (b)(vi) of new Section 8 of Rule 8 would provide that, as with Sponsored GC Trades,
Paragraph (b)(vii) of new Section 8 of Rule 8 would state that, as under Sponsored GC Trades,
Lastly, paragraph (c) of the new Section 8 of Rule 8 would set forth the Funds-Only Settlement Amount obligations that would be payable in respect of ACS Triparty Trades. It would provide that, as with Sponsored GC Trades,
FICC would amend Section 10 (“Liquidation of the Agent Clearing Transactions of an Executing Firm Customer”) of Rule 8, which is being proposed to be added by the Default Management Proposal as Section 9 and to be renumbered as Section 10 with this proposed rule change, to exclude ACS Triparty Trades from the liquidation mechanism that would be described in proposed Section 10(c)(i). Specifically, this subsection would provide that the mechanism applies “with respect to the liquidation of positions resulting from Agent Clearing Transactions other than ACS Triparty Trades.”
The deadline would be 5:30 p.m. for (i) substitutions of Purchased ACS Triparty Repo Securities in accordance with Section 8(b)(v) of Rule 8, and (ii) the ACS Triparty Funds Lender and ACS Triparty Funds Borrower, respectively, to satisfy ACS Triparty Collateral Return Obligations and cash payment obligations associated with ACS Triparty Collateral Return
Under the Schedule of ACS Triparty Trade Timeframes, the time during which reports would be made available with respect to end of day Clearing Fund requirements and funds-only settlement requirements would be from 10:30 p.m. to 2:00 a.m. 2:00 p.m. would be the time during which reports would be made available with respect to the intraday Clearing Fund requirements, and intraday funds-only settlement requirements. At 10:00 a.m., funds-only settlement debits and credits would be executed via the Federal Reserve's National Settlement Service, and at 4:30 p.m., the intraday funds-only settlement debits and credits would be executed via the Federal Reserve's National Settlement Service.
9:00 a.m. would be the deadline for the ACS Triparty Funds Borrower to deliver additional GC Comparable Securities and/or cash in accordance with Sections 8(b)(ii) and (vi) of Rule 8. FICC would also reserve the right to require an ACS Triparty Funds Borrower to satisfy such obligation on an intraday basis based on the market value of the applicable ACS Triparty Repo Securities as determined by the ACS Triparty Clearing Agent Bank in accordance with Section 8(b)(vii) of Rule 8. 12:00 p.m. would be the deadline for the ACS Triparty Funds Borrower (or if the repo rate for the relevant ACS Triparty Trade is negative, the ACS Triparty Funds Lender) to pay to FICC the accrued GC Daily Repo Interest as described in Section 8(b)(iv) in accordance with the provisions of Section 8(b)(vi) of Rule 8 (unless the End Leg of the related ACS Triparty Trade is due to settle on the same day). Any accrued GC Daily Repo Interest that is due on the settlement day of the End Leg of the related ACS Triparty Trade would need to be paid in connection with the settlement of the End Leg.
5:00 p.m. would be the deadline for final input by Agent Clearing Members to FICC of ACS Triparty Trade data. And, finally, 7:00 p.m. would be the deadline for full settlement of the Start Leg of the ACS Triparty Trade in accordance with Section 8(a)(ii)(C) of Rule 8.
The Schedule of ACS Triparty Trade Timeframes would provide for the ACS Triparty Clearing Agent Bank to determine the time by which an ACS Triparty Funds Lender would be required to deliver any excess securities to an ACS Triparty Funds Borrower in connection with Section 8(b)(iii) of Rule 8. It would further provide FICC with the ability to extend timeframes as needed to (i) address operational or other delays that would reasonably prevent members or FICC from meeting the deadline or timeframe, as applicable, or (ii) allow FICC time to operationally exercise its existing rights under the Rules. In addition, it would state that times applicable to FICC are standards and not deadlines; actual processing times may vary slightly, as necessary.
FICC proposes to revise the Schedule for the Deletion of Trade Data to provide that, as with Sponsored GC Trades, the first paragraph thereof relating to how long uncompared trades will pend in the Comparison System would not apply to ACS Triparty Trades. In addition, FICC would add language to state that trade data on ACS Triparty Trades that remain uncompared on a given Business Day would, as with Sponsored GC Trades, pend in the Comparison System until FICC's deadline for final input by Agent Clearing Members of ACS Triparty Trade data (as provided in the Schedule of ACS Triparty Trade Timeframes) on such Business Day. FICC would also add language to state that trade data on ACS Triparty Trades, which have been compared in the Comparison System pursuant to Rule 6A but the Start Legs of which have not fully settled at an ACS Triparty Clearing Agent Bank by the deadline set forth in FICC's Schedule of ACS Triparty Trade Timeframes, would be deleted from the Comparison System during the same processing cycle as the Repo Start Date for such ACS Triparty Trades.
FICC proposes to revise the Schedule of Required and Accepted Data Submission Items for a Substitution of Existing Securities Collateral, and the Schedule of Required and Accepted Data Submission Items for a Substitution for New Securities Collateral to state that, as with Sponsored GC Trades, they would not apply to ACS Triparty Trades.
FICC proposes to revise the Schedule of GC Comparable Securities to state that one could refer to the ACS Triparty Clearing Agent Bank, as applicable, for details regarding the Fed “tickers” applicable to GC Comparable Securities.
FICC understands that, like Sponsoring Members and their Sponsored Members under the Sponsored Service, an Agent Clearing Member may choose to post to its Executing Firm Customer a haircut in order to address regulatory and/or investment guideline concerns.
Therefore, to ensure that Initial Haircuts are not returned until final settlement under done-with Agent Clearing Transactions, FICC proposes to adopt Rules that would align the treatment of Initial Haircuts under Agent Clearing Transactions with how FICC treats Initial Haircuts under Sponsored Member Trades. In particular, FICC proposes to calculate the Collateral Mark (
In addition, FICC proposes to make clear that an ACS Triparty Trade, like a Sponsored GC Trade, may but need not have an Initial Haircut.
Lastly, FICC proposes to make clear that an Agent Clearing Transaction with an Initial Haircut, just like a Sponsored Member Trade with an Initial Haircut, would constitute an “Off-the-Market Transaction.” When FICC adopted this clarification in the context of Sponsored Member Trades, it noted that treatment of transactions with an Initial Haircut as Off-the-Market Transactions is appropriate “given that these additional funds payments are pass-through amounts and do not represent risk to FICC or its members.”
To implement the proposed changes described above, FICC proposes to make the following amendments to its Rules.
FICC would revise the definitions of “Current Haircut”, “Haircut Deficit”, and “Haircut Surplus” to provide that these terms apply to Agent Clearing Transactions between the Agent Clearing Member and the Executing Firm Customer.
FICC would also revise the definition of “Initial Haircut” to mean, as regards any Agent Clearing Transaction that is not an ACS Triparty Trade, the absolute value of the dollar difference, if any, between the Market Value of the Agent Clearing Transaction, as of the settlement date of the Start Leg, and the Contract Value of the Start Leg of the Agent Clearing Transaction, and as regards any ACS Triparty Trade, any difference between (x) the Contract Value of the Start Leg of the ACS Triparty Trade and (y) the GC Start Leg Market Value. These changes correspond to how Initial Haircut is defined in relation to Sponsored Member Trades.
Lastly, FICC would revise the definition of “Off-the-Market Transaction” to state that an Off-the-Market Transaction includes a Sponsored Member Trade and an Agent Clearing Transaction with an Initial Haircut.
In addition, FICC would revise Section 7(h) of Rule 8 (former Section 7(f) of Rule 8) to state that except as expressly set forth in Rule 8, if a loss or liability of FICC is determined to arise in connection with the close-out or liquidation of an Agent Clearing Transaction of an Executing Firm Customer that is an Off-the-Market Transaction because the Executing Firm Customer has provided an Initial Haircut, FICC would allocate such loss or liability attributable to the Initial Haircut to such Executing Firm Customer in accordance with the provisions of Section 7 of Rule 4. This allocation of losses arising from Initial Haircuts to the Executing Firm Customer that posted such haircuts would align with the treatment of such haircuts under Sponsored Member Trades and thus be “consistent with FICC's practice to facilitate Initial Haircuts as payments but [not otherwise include them as] part of FICC's risk management processes.”
As discussed above, FICC does not Novate the Start Legs of same-day starting done-with Sponsored Member Trades considering the operational and legal complexities for Sponsored Members and Sponsoring Members of doing so. Since FICC understands similar complexities apply to Executing Firm Customers and their Agent Clearing Members, FICC proposes amendments to the Rules to provide that FICC would similarly not Novate the Start Leg of any done-with same-day starting Agent Clearing Transactions. As mentioned above, FICC also proposes that FICC would not Novate the Start Leg of any ACS Triparty Trade.
To implement this proposed change, FICC proposes to revise the definition of “Same-Day Settling Trade” in Rule 1 to make clear that the only Agent Clearing Transaction that constitutes a Same-Day Settling Trade is one that (1) is not an ACS Triparty Trade, (2) is executed between an Executing Firm Customer and a Netting Member or Indirect Participant other than its Agent Clearing Member and (3) meets the requirements of clause (i) and (ii) of that definition. This revision would align the way the Same-Day Settling Trade definition applies to Agent Clearing Transactions with how it applies to Sponsored Member Trades. Accordingly, by virtue of this change, a same-day settling done-with Agent Clearing Transaction or any ACS Triparty Trade would not be a Same-Day Settling Trade and therefore would not be subject to FICC's Same-Day Settling Service through which
FICC also proposes to revise Section 7(e) of Rule 8 (to be renumbered Section 7(f) pursuant to these proposed rule changes) which currently provides that, notwithstanding the provisions of Rule 12 (which addresses securities settlement), Agent Clearing Transactions that are Same-Day Settling Trades are not settled at FICC through its Comparison System if the Agent Clearing Member delivers a notice to FICC that it does not wish to have such transactions settle at FICC. The proposed changes would simplify and clarify this section to align with the proposed changes to the definition of Same-Day Settling Trade to simply provide that Agent Clearing Transactions that are Same-Day Settling Trades do not settle at FICC, and would remove the need for an Agent Clearing Member to provide a notice.
Finally, FICC proposes to make a number of clarifying, conforming, and technical changes in connection with the proposed rule changes described above.
FICC proposes to revise the definitions of “Current Haircut,” “Haircut Deficit,” and “Haircut Surplus” to make clear that those definitions only apply to done-with DVP Repo Transactions. This is because FICC does not support Initial Haircuts for done-away DVP Repo Transactions. It only supports Initial Haircuts in the context of done-with DVP Repo Transactions. For similar reasons, FICC proposes to amend Section 9 of Rule 3A to clarify that FICC only incorporates Initial Haircuts into its calculation of Funds-Only Settlement Amounts in relation to done-with Sponsored Member Trades.
FICC would revise Section 4 of Rule 5 to require ACS Triparty Trades be submitted exactly as executed. Section 7(h) of Rule 8 would be relocated as a new sentence at the end of new Section 7(d).
FICC proposes to add a new Section 7(c) to Rule 8 to state that ACS Triparty Trades would not be subject to the Schedule of Timeframes applicable to Agent Clearing Transactions generally, but instead to the Schedule of ACS Triparty Trade Timeframes.
FICC proposes to renumber Section 7(e) of Rule 8 as Section 7(f).
Subject to approval by the Commission, FICC would implement the proposed rule change by no later than 6 months after approval. FICC would announce the effective date of the proposed changes by an Important Notice posted to its website.
FICC believes these proposed changes are consistent with the requirements of the Act, and the rules and regulations thereunder applicable to FICC. Specifically, FICC believes that the proposed changes are consistent with Section 17A(b)(3)(F) of the Act
Section 17A(b)(3)(F) of the Act requires, in part, that the Rules be designed to foster cooperation and coordination with persons engaged in the clearance and settlement of securities transactions, to remove impediments to and perfect the mechanism of a national system for the prompt and accurate clearance and settlement of securities transactions, and, in general, to protect investors and the public interest.
As described above, the Agent Clearing Service contains certain features, including net margining of positions across Executing Firm Customers, a legal framework similar to the U.S. futures clearing model, a more streamlined onboarding process, and intermediation sufficient to allow perfection of security interests without financing statements, that can make it easier and less expensive for direct participants to submit their customers' transactions, including done-away transactions, to FICC for clearance and settlement.
In addition, by aligning the treatment of haircuts and Start Legs under Agent Clearing Transactions with the treatment applicable to Sponsored Member Trades, the proposed changes would facilitate access to FICC's clearing and settlement services for market participants that require Initial Haircuts and/or face challenges in relation to the Novation of Start Legs. By facilitating greater access to FICC's clearance and settlement services, the proposed rule changes would remove impediments to and perfect the mechanism of a national system for the prompt and accurate clearance and settlement of securities transactions.
Rule 17ad-22(e)(4)(i) under the Act requires that FICC establish, implement, maintain, and enforce written policies and procedures reasonably designed to effectively identify, measure, monitor, and manage its credit exposures to participants and those arising from its payment, clearing, and settlement processes by maintaining sufficient financial resources to cover its credit exposure to each participant fully with a high degree of confidence.
Rule 17ad-22(e)(18)(iv)(C) requires, in part, FICC to ensure that it has appropriate means to facilitate access to clearance and settlement services of all eligible secondary market transactions in U.S. Treasury securities, including those of indirect participants.
Rule 17ad-22(e)(19) under the Act requires that FICC establish, implement, maintain, and enforce written policies and procedures reasonably designed to identify, monitor, and manage the material risks to the covered clearing agency arising from arrangements in which firms that are indirect participants in the covered clearing agency rely on the services provided by direct participants to access the covered clearing agency's payment, clearing, or settlement facilities.
Rule 17ad-22(e)(23)(ii) under the Act requires that a covered clearing agency establish, implement, maintain, and enforce written policies and procedures reasonably designed to provide sufficient information to enable participants to identify and evaluate the risks, fees, and other material costs they incur by participating in the covered clearing agency.
FICC believes that the proposed changes would promote competition by providing market participants with another way to access FICC's clearance and settlement services. As mentioned above, the ACS Triparty Service would combine the benefits of the existing Sponsored GC Service and Agent Clearing Service. Accordingly, it would further allow market participants to access FICC's clearance and settlement services (or provide access) in a way that meets their regulatory, cost, legal, operational and other needs. As a result, the proposed rule changes would limit the extent to which certain market participants are placed at a disadvantage due to regulatory, operational, legal, size, or other challenges that limit their ability to access clearing. Moreover, the proposed changes would place those unable to onboard directly with FICC,
FICC has not received or solicited any written comments relating to this proposal. If any written comments are received, they will be publicly filed as an Exhibit 2 to this filing, as required by Form 19b-4 and the General Instructions thereto.
Persons submitting comments are cautioned that, according to Section IV (Solicitation of Comments) of the Exhibit 1A in the General Instructions to Form 19b-4, the Commission does not edit personal identifying information from comment submissions. Commenters should submit only information that they wish to make available publicly, including their name, email address, and any other identifying information.
All prospective commenters should follow the Commission's instructions on
Within 45 days of the date of publication of this notice in the
(A) by order approve or disapprove such proposed rule change, or
(B) institute proceedings to determine whether the proposed rule change should be disapproved.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
Cboe EDGA Exchange, Inc. (the “Exchange” or “EDGA”) proposes to introduce a Small Retail Broker Hosted Solutions Program and to update the existing eligibility requirements for the Small Retail Brokerage Distribution Program for the Cboe One Summary Feed. The text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the Exchange's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to adopt a Small Retail Broker Hosted Solutions Program (the “Program”) for Cboe One Summary Data (collectively, the “Applicable Feed”).
Further, the Exchange proposes to increase the allowed maximum Non-Professional Data User subscriber count for the existing Small Retail Broker Program for Cboe One Summary Feed.
Currently, the Exchange offers a Small Retail Broker Distribution Program
The Exchange now proposes to create a new Program based on the proposed eligibility criteria for Small Retail Brokers to specifically support Small Retail Brokers who are operating platforms on behalf of other Small Retail Brokers. Based on customer feedback, there are Small Retail Brokers who would like to provide this data via a hosted solution as a White Label Service
Of further note, the Hosting Small Retail Broker is responsible for reporting its External Hosted Subscribers and their users, and ultimately the Hosting Small Retail Broker is responsible for payment of all data fees for both its External Subscribers and itself. While the Exchange is not privy to pass-through costs between Hosting Small Retail Broker Distributor and the External Hosted Subscribers, the Hosting Small Retail Broker is ultimately charged Distribution Fees (in addition to the other applicable fees) for the (i) Applicable Feed to the External Hosted Subscriber and (ii) Applicable Feed to the External Hosted Subscriber's end users, despite the Hosting Small Retail Broker managing the application for the External Hosted Subscriber's users. This proposed Program is intended to provide relief for the overall charges that a Hosting Small Retail Broker incurs based on operating a platform that allows an External Hosted Subscriber's retail users to receive data.
Additionally, given that External Hosted Subscribers are smaller relative to other Small Retail Brokers currently participating in the existing Small Retail Broker Distribution Program, their ability to subscribe to the Applicable Feed as Hosting Small Retail Broker Distributors is likely not feasible. Specifically, the costs of the Applicable Feed may themselves make access to this data impractical. Additionally, the costs associated with building and maintaining the technological infrastructure to receive and disseminate data, may make access to such data impractical. Generally speaking, technology, infrastructure, and connectivity costs are a significant monetary investment and require significant human expertise and resources to maintain. As such, the totality of costs can make access to data difficult. The Exchange believes, though, that the proposed fees and the ability to subscribe to the Applicable Feed as External Hosted Subscribers will make access to data more feasible. Indeed, the Exchange anticipates that the retail broker-dealers that would seek to become External Hosted Subscribers are broker-dealers that do not have the technological infrastructure in place to ingest and disseminate data as a Hosting Small Retail Broker, and that are likely to have smaller client bases and business models not as conducive to making the investments necessary to become a Hosting Small Retail Broker Distributor.
In these regards, the Exchange believes that the proposed program will incentivize Hosting Small Retail Broker Distributors to offer the Applicable Feed to External Hosted Subscribers, thereby making data accessible to a larger number of broker-dealers and their clients, at an affordable cost. Specifically, under the proposed program, a Hosting Small Retail Broker Distributor providing the data to at least one External Hosted Subscriber would
In addition to the changes set forth above, the Exchange also proposes to modify the existing Small Retail Broker Program for Cboe One Summary Feed to increase the number of Non-Professional Data User maximum from 5,000 to 10,000 to be consistent with the proposed threshold for External Hosted Subscribers. As previously discussed, the Exchange proposes to also use the cap of 10,000 Non-Professional Data Users for the proposed Program. The Exchange proposes to increase this in support of increased participation across both retail and investor markets in order to facilitate the growth of smaller retail brokers on a global scale.
As mentioned above, the existing fee structure makes it costly for both Hosting Small Retail Broker Distributors and its External Hosted Subscribers to provide data to the External Hosted Subscribers' retail clients as Distribution Fees are assessed on both Small Retail Brokers. Overall, the Exchange believes that this fee proposal will help to make its data more widely accessible for retail users who receive their data from External Hosted Subscribers. Specifically, the Exchange believes that that this proposal will (i) further increase the competitiveness of the Exchange's top of book market data products compared to competitor offerings that may currently be cheaper for firms with a limited subscriber base that do not yet have the scale to take advantage of the lower subscriber fees offered by the Exchange; and will (ii) provide additional incentives for Hosting Small Retail Broker Distributors to provide hosted solution services for other Small Retail Brokers in order to make data more widely available to retail investors. In turn, the Exchange believes that this change may benefit market participants and investors by spurring additional competition and increasing the accessibility of the Exchange's top of book data.
The Exchange notes that at least one other exchange has a similar offering. For example, the New York Stock Exchange has a Redistribution Fee Waiver for NYSE Trades, for which redistributors of data may have their redistribution fee waived so long as they provide the data to at least one data feed recipient and reports such data feed recipient or recipients to the Exchange.
Without the proposed pricing discounts, the Exchange believes that (i) prospective customers may not be interested in purchasing top of book data from the Exchange, and may instead purchase such data from other national securities exchanges or the Securities Information Processors (“SIPs”), potentially at a higher cost than would be available pursuant to the proposed program and (ii) that Hosting Small Retail Broker Distributors are not incentivized to make the Applicable Feed available via a hosted solution for retail investors of its External Hosted Subscribers. Similar to the existing Small Retail Broker Program previously introduced, the Exchange believes that the proposed Program will continue to increase competition for such market data, and that enhanced competition could help to further reduce data fees as providers compete for subscribers, as well as help diversify the availability and quality of data offerings available to retail investors through their Hosting Small Retail Broker Distributors. Ultimately, the Exchange believes that it is critical that it be allowed to compete by offering attractive pricing to customers as increasing the availability of such products ensures continued competition with alternative offerings. Such competition may be constrained when competitors are impeded from offering alternative and cost-effective solutions to customers.
The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,
The Exchange also believes that the proposed rule change is consistent with Section 11(A) of the Act.
In adopting Regulation NMS, the Commission granted SROs and broker-dealers increased authority and flexibility to offer new and unique market data to the public. It was believed that this authority would expand the amount of data available to consumers, and also spur innovation and competition for the provision of market data. The Exchange believes that the proposed fee change would further broaden the availability of U.S. equity market data to investors, and in particular retail investors, consistent with the principles of Regulation NMS.
The Exchange operates in a highly competitive environment. Indeed, there are sixteen registered national securities exchanges that trade U.S. equities and offer associated top of book market data products to their customers. The national securities exchanges also compete with the SIPs for market data customers. The Commission has repeatedly expressed its preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. Specifically, in Regulation NMS, the Commission highlighted the importance of market forces in determining prices and SRO revenues
Making alternative data products available to market participants ultimately ensures increased competition in the marketplace and constrains the ability of exchanges to charge prohibitive fees. If a market participant views one exchange's top of book data fees as more or less attractive than the competition they can, and frequently do, switch between competing products. In fact, the competitiveness of the market for such top of book data products is one of the primary factors animating this proposed rule change, which is designed to allow the Exchange to further compete for this business. As mentioned above, at least one other Exchange provides a similar waiver for redistribution of market data.
The Exchange notes that the Applicable Feed is distributed and purchased on a voluntary basis, in that neither the Exchange nor market data distributors are required by any rule or regulation to make these data products available. Distributors (including vendors) and Users can therefore discontinue use at any time and for any reason, including due to an assessment of the reasonableness of fees charged. Further, the Exchange is not required to make any proprietary data products available or to offer any specific pricing alternatives to any customers.
The Commission has long stressed the need to ensure that the equities markets are structured in a way that meets the needs of ordinary investors. For example, the Commission's strategic plan for fiscal years 2018-2022 touts “focus on the long-term interests of our Main Street investors” as the Commission's number one strategic goal.
The Exchange notes that the proposed waivers for the Applicable Feed only apply to Hosting Small Retail Broker Distributors and its External Hosted Subscribers for three reasons. The first is that the Hosting Small Retail Broker Distributors undertake the operation of the platform of which the ultimate retail investors view the data provided by the External Hosted Subscriber. The Hosting Small Retail Broker Distributor maintains control of the application's data, entitlements and display. In comparison, to the existing Small Retail Broker Program, eligible participants have no such obligations and are eligible for this only by meeting the requirements and externally distributing the data (which may be directly to retail investors). In order to incentivize the Hosting Small Retail Broker Distributors to undergo this challenge, the Exchange believes it is not unfairly discriminatory to provide a waiver of the Distribution Fee for the Hosting Small Retail Broker, as opposed to the standard discounted Distribution Fee normally paid under the current Small Retail Broker Distribution Program.
Second, by creating this program, the Exchange is further able to reach additional retail investors. By waiving Distribution Fees for both the Hosting Small Retail Broker Distributor and its External Hosted Subscriber, both parties are incentivized to work together to provide data to retail investors. Finally, as mentioned previously, the Hosting Small Retail Broker Distributor is responsible for the fees and reporting for both its activity and its External Hosted Subscriber. This means that under the existing program, if a Hosting Small Retail Broker has one External Hosted Subscriber, the Hosting Small Retail Broker is receiving a bill for two Distribution Fees, two Data Consolidation fees and the cost of both its and its External Hosted Subscriber's Professional Users and Non-Professional Users. Through this Program, the fees will not be a deterrent for Hosting Small Retail Broker Distributors and External Hosted Subscribers to establish platforms that reach a wider scope of retail investors.
Furthermore, while this Program would be effectively limited to smaller firms in accordance with the proposed eligibility requirements, the Exchange does not believe that this limitation makes the fees inequitable or unfairly discriminatory. The Exchange notes that large broker-dealers and/or vendors that distribute the Exchange's data products to a sizeable number of investors benefit from the current fee structure, which includes lower subscriber fees and Enterprise licenses. Due to lower subscriber fees, distributors that provide the Applicable Data Feed to more than the proposed capped amounts of Users permitted under either the Small Retail Broker Program or this Program already enjoy cost savings compared to competitor products. The Program, in addition to the existing Small Retail Broker Program, would therefore continue to ensure that small retail brokers that distribute top of book data to their retail investor customers could also benefit from reduced pricing, and would aid in increasing the competitiveness of the Exchange's data products for this key segment of the market.
Moreover, the Exchange does not believe that the proposed fees unfairly discriminate between Hosting Small Retail Broker Distributors and External Hosted Subscribers. While the proposal provides additional benefits to External Hosted Subscribers that would not otherwise accrue to them under the current program, the Exchange notes that such benefits are designed only to make access to market data more accessible to smaller retail broker-dealers that either do not possess the financial and technological resources necessary to receive data as a Small Retail Broker, or simply choose not commit such resourced based on their business models. In turn, to continue to incentivize the provision of the Applicable Feed by Hosting Small Retail Broker Distributors, the Exchange has sought to provide appropriate incentives to these brokers as well. Collectively, the fee structure provides benefits to both Hosting Small Retail Broker Distributors and External Hosted Subscribers.
While External Hosted Subscribers would receive benefits they would not accrue under the current program, these are not benefits that today's Small Retail Brokers would choose to avail themselves of under the new fee structure, because it is highly unlikely that today's Small Retail Brokers would choose to instead become External Hosted Subscribers. The Exchange notes that today's Small Retail Brokers that qualify under the current program, have already committed significant capital in terms of time, technology, and finances towards building out and maintaining the technological infrastructure and
Rather, the Exchange believes that the more likely case is that the proposed fee structure will attract a new population of Small Retail Brokers who will seek to access the Applicable Feed as Hosted External Subscribers, at a cost-effective price point, thereby providing even more investors with access to top of book market data for U.S. equities. Another likely use case is that the proposed fee structure may incentivize more Small Retail Brokers to subscribe to the Applicable Feed as External Hosted Subscribers and, as they build their own business models and attract subscribers of their own, eventually commit time and resources to building their own infrastructure to evolve into a Hosting Small Retail Broker.
Furthermore, the Exchange acknowledges that under the proposed fee schedule that a Hosting Small Retail Broker Distributor is eligible for a waiver of its Distribution Fee once its first External Hosted Subscriber is subscribed, whereas under current program a Small Retail Broker is not eligible for such a waiver. However, the Exchange does not believe that this proposed fee structure unfairly discriminates between existing Small Retail Brokers and Hosting Small Retail Brokers, because the application of these fees is based on meaningful differences between existing Small Retail Brokers and potential Hosting Small Retail Broker Distributors.
Specifically, existing Small Retail Brokers are brokers that distribute the Applicable Feed to their own customers. These Small Retail Brokers typically operate their own retail trading businesses, and the provision of the Applicable Feed is part of the package of services provided to their own customers. Comparatively, similar to certain subscribers
Relatedly, the proposed fees are based on the competitive environment for market data products such as the Applicable Feed. In response to competition from other market data feeds such as NYSE BQT, the Exchange's proposed fees are merely intended to provide a financial incentive for vendors/redistributors that do not currently subscribe to any Exchange market data products to subscribe to the Applicable Feed. By focusing on this segment of the market, the Exchange believes that the proposed fees will make the Applicable Feed more competitive and attractive for vendors/redistributors to subscribe to, thereby increasing the availability of the Exchange's data products, expanding the options available to firms making data purchasing decisions on their business needs, and generally increasing competition. In this regard, the Exchange believes that the proposed fees—particularly the waiver of the Distribution Fee—will incentivize Hosting Small Broker Distributors (
Moreover, the Exchange believes that the proposed change to provide a waiver of the Distribution Fee to a Hosting Small Retail Broker Distributor (
Finally, the Exchange notes that nothing in the current proposal prevents an existing Small Retail Broker from choosing to instead subscribe to the Applicable Feed as an External Hosted Subscriber. However, the Exchange does not believe that this makes the proposal unfairly discriminatory between Hosting Small Retail Broker Distributors and External Hosted Subscribers, as broker-dealers are free operate their businesses however they may choose in response to a host of a reasons, only one of which are associated costs.
The Exchange believes that the proposed cap of 10,000 for the Cboe One Summary Data Feed for this Program, as
The Exchange believes that the Distribution Fee Waivers for both the External Hosted Subscriber and the Hosting Small Retail Broker Distributor are reasonable as they represent a significant cost reduction for the Hosting Small Retail Broker Distributor to provide a hosted solution for the External Hosted Subscriber, to ultimately provide the data to the External Hosted Subscriber's retail investors. By targeting the Distribution Fee waiver to vendors/redistributors that provide external distribution of the Applicable Feeds, the Exchange believes that this would provide an incentive for redistributors to make the Applicable Feeds available to its customers. Specifically, if a data recipient is interested in subscribing to the Applicable Feeds and relies on a vendor/redistributor to obtain market data products from the Exchange, that data customer would need the vendor/redistributor to first subscribe to and distribute the Applicable Feeds. In this regard, the Exchange believes the proposed waiver would provide an incentive for vendors/redistributors to make the Applicable Feeds available to their customers, which will increase the availability of the Applicable Feeds to a larger potential population of retail investors.
While the existing fee structure does provide a benefit of a discounted waiver for Small Retail Brokers that externally distribute the data, these discounted Distribution Fees are still incurred by both the external Hosted Subscriber and the Hosting Small Retail Broker Distributor. In an attempt to alleviate these costs, and make this data more available to retail investors, the Exchange proposes to waive the Distribution Fees for both the Hosting Small Retail Broker Distributor and the External Hosted Subscriber. With this Program, the Exchange believes it will increase market accessibility and data to investors on a global scale. Exchange Hosted Subscribers may not have the infrastructure or technical capabilities to offer market data and/or execution services to its retail investors. Through waiving these fees for the External Hosted Subscriber, the Exchange hopes to reach a broader scale of retail investors globally. Further, as discussed above, the Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber and the Hosting Small Retail Broker Distributor given the development and maintenance the Hosting Small Retail Broker Distributor undergoes to provide this data to the External Hosted Subscriber's end users.
The Exchange believes it is reasonable to not charge the External Hosted Subscriber the Data Consolidation Fee for Cboe One Summary Data for the duration of the time that they are eligible for this program. As previously discussed, the waiver of fees for the External Hosted Subscriber is intended to make this data more available to retail investors. The Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber because, as described above, the Exchange believes by alleviating some of the barriers to entry, that Exchange Hosted Subscribers are able to bring this data and execution services to their retail investors. Of further note, the Exchange believes it is reasonable to maintain this cost for the Hosting Small Retail Broker Distributor as the Hosting Small Retail Broker Distributor is the party receiving this data from the Exchange where it is consolidated for the benefit of the Hosting Small Retail Broker Distributor.
The Exchange believes it is reasonable to set a fixed cost for Non-Professional Users fees for External Hosted Subscribers by charging a flat, fixed cost instead of charging per user to allow for additional savings. Under this structure, the External Hosted Subscriber shall still be responsible by paying the standard per User fee of a Professional Users under the Applicable Feed. The Exchange does not believe this is unfairly discriminatory as the program is based around making the Applicable Feed available for Non-Professional Users. The Exchange also notes that it has taken a similar approach here to the NYSE Per User Access Fee, which sets a fixed cost where the data is used only for display purposes.
The Exchange does not believe that the proposed rule change would result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange operates in a highly competitive environment, and its ability to price these data products is constrained by: (i) Competition among exchanges that offer similar data products to their customers; and (ii) the existence of inexpensive real-time consolidated data disseminated by the SIPs. Top of book data is disseminated by both the SIPs and the sixteen equities exchanges. There are therefore a number of alternative products available to market participants and investors. In this competitive environment potential subscribers are free to choose which competing product to purchase to satisfy their need for market information. Often, the choice comes down to price, as broker-dealers or vendors look to purchase the cheapest top of book data product, or quality, as market participants seek to purchase data that represents significant market liquidity. In order to better compete for this segment of the market, the Exchange is proposing to reduce the cost of top of book data provided by Hosting Small Retail Broker Distributors to its External Hosted Subscribers, and in turn, their retail investors. The Exchange believes that this would facilitate greater access to such data, ultimately benefiting the retail investors that are provided access to such market data.
The Exchange also believes the proposed fee changes will better enable it to compete in the Asia Pacific region, which is an area of increasing interest and growth within the U.S. equities markets, generally. As the Asia Pacific investor base seeks access to the liquidity and efficient price discovery processes that exist in the U.S. equities markets, various broker-dealers have begun offering trading in this region, and exchanges have begun to contemplate 24-hour trading solutions designed to capture the increased demand from the Asia Pacific investor base.
The Exchange does not believe that this price reduction would cause any unnecessary or inappropriate burden on intermarket competition as other exchanges and data vendors are free to lower their prices to better compete with the Exchange's offering. Indeed, as explained in the basis section of this proposed rule change, the Exchange's decision to (i) waive the Distribution Fee for the Hosting Small Retail Broker Distributor and the External Hosted Subscriber and (ii) waiving the Consolidation Fee (when applicable) for the External Hosted Subscriber and (iii) setting a fixed cost for the Non-Professional Users for the External Hosted Subscriber is itself a competitive response to different fee structures available on competing markets. The Exchange therefore believes that the proposed rule change is pro-competitive as it seeks to offer pricing incentives to customers to better position the Exchange as it competes to attract additional market data subscribers. The Exchange also believes that the proposed reduction in fees the Hosting Small Retail Broker Distributor and the External Hosted Subscriber would not cause any unnecessary or inappropriate burden on intramarket competition. Although the proposed fee discount would be largely limited to small retail broker subscribers, larger broker-dealers and vendors can already purchase top of book data from the Exchange at prices that represent a significant cost savings when compared to competitor products that combine higher subscriber fees with lower fees for distribution. In light of the benefits already provided to this group of subscribers, the Exchange believes that additional discounts to small retail brokers would increase rather than decrease competition among broker-dealers that participate on the Exchange. Furthermore, as discussed earlier in this proposed rule change, the Exchange believes that offering pricing benefits to brokers that represent retail investors facilitates the Commission's mission of protecting ordinary investors, and is therefore consistent with the Act.
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to amend the fees for Nasdaq 100® Index options in the Exchange's Pricing Schedule at Options 7, Section 3.
While the changes proposed herein are effective upon filing, the Exchange has designated the amendments become operative on October 1, 2025.
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to amend the fees for the Nasdaq 100® Index (“NDX”).
As set forth in Options 7, Section 3, the Exchange currently charges all Non-Priority Customer
The Exchange now proposes to increase the Priority Customer pricing in NDX from $0.25 to $0.50 per contract. Priority Customers will continue to be assessed a lower fee as compared to Non-Customers. While the Exchange is increasing the fee, the Exchange believes that a Priority Customer fee of $0.50 per contract will continue to attract order flow to the Exchange.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The Exchange believes that its proposal to increase the Priority Customer pricing in NDX from $0.25 to $0.50 per contract is reasonable because Priority Customers will continue to be assessed a lower fee as compared to Non-Priority Customers. While the Exchange is increasing the fee, the Exchange believes that a Priority Customer fee of $0.50 per contract will continue to attract order flow to the Exchange. The Exchange notes that market participants are offered different ways to gain exposure to the Nasdaq 100 Index, whether through the Exchange's proprietary products like options overlying NDX or XND, or separately through multi-listed options overlying Invesco QQQ Trust (“QQQ”).
The Exchange believes that its proposal is equitable and not unfairly discriminatory because it will be applied uniformly to all Priority Customers. Assessing a lower fee to Priority Customers as compared to Non-Priority Customers is equitable and not unfairly discriminatory because Priority Customer liquidity benefits all market participants by providing more trading opportunities, which attracts market makers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants, to the benefit of all market participants who may interact with the order flow.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
In terms of intra-market competition, the Exchange believes that its proposal does not impose an undue burden on competition because the fee will be applied uniformly to all Priority Customers. Assessing a lower fee to Priority Customers as compared to Non-Priority Customers is does not impose an undue burden on competition because Priority Customer liquidity benefits all market participants by providing more trading opportunities, which attracts market makers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants, to the benefit of all market participants who may interact with the order flow.
In terms of inter-market competition, the Exchange 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, or rebate opportunities available at other venues to be more favorable. In such an environment, the Exchange must continually adjust its fees to remain competitive with other options exchanges. Because competitors are free to modify their own fees in response, and because market participants may readily adjust their order routing practices, the Exchange believes that the degree to which fee changes in this market may impose any burden on competition is extremely limited. As noted above, market participants are offered an opportunity to transact in NDX, NDXP, or XND, or separately execute options overlying QQQ. Offering these products provides market participants with a variety of choices in selecting the product they desire to use to gain exposure to the Nasdaq 100 Index.
In addition to the Exchange, market participants have alternative options exchanges that they may participate on and direct their order flow, which list proprietary products that compete with
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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: (i) necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) 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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange proposes to adopt monthly fees for its proprietary market data feeds. The proposed rule change is available on the Exchange's website at
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.
The Exchange is proposing to adopt the monthly fees it will charge Members
The Exchange offers three separate data feeds to subscribers—Depth of Book (“24X Depth”), Top of Book (“24X Top”), and Last Sale (“24X Last Sale”), as well as historical versions of each.
The 24X Depth feed is a 24X-only market data feed that contains all displayed orders for securities trading on the Exchange (
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• In connection with a Distributor's distribution of the 24X Depth feed, the Distributor must count as one User each unique User that is entitled to have access to the 24X Depth feed.
• Distributors must report each individual person who receives access to the 24X Depth feed through multiple devices or multiple methods (
• If a Distributor entitles one or more individuals to use the same device, the Distributor must include only the individuals, and not the device, in the User count. Thus, Distributors would not be required to report User device counts associated with a User's display use of the 24X Depth feed.
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The 24X Top feed is a 24X-only market data feed that contains top of book quotations based on equity orders entered into the trading system.
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• In connection with an External Distributor's distribution of the 24X Top feed, the Distributor must count as one User each unique User that is entitled to have access to the 24X Top feed.
• External Distributors must report each individual person who receives access to the 24X Top feed through multiple devices or multiple methods (
• If an External Distributor entitles one or more individuals to use the same device, the Distributor must include only the individuals, and not the device, in the User count. Thus, Distributors would not be required to report User device counts associated with a User's display use of the 24X Top feed.
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The 24X Last Sale feed is a 24X-only market data feed that contains only execution information based on equity orders entered into the System.
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• In connection with an External Distributor's distribution of the 24X Last Sale feed, the Distributor must count as one User each unique User that is entitled to have access to the 24X Last Sale feed.
• External Distributors must report each individual person who receives access to the 24X Last Sale feed through multiple devices or multiple methods (
• If an External Distributor entitles one or more individuals to use the same device, the Distributor must include only the individuals, and not the device, in the User count. Thus, Distributors would not be required to report User device counts associated with a User's display use of the 24X Last Sale feed.
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The Exchange believes that the proposed rule change is consistent with the provisions of Section 6(b)
The Exchange believes the proposed fees and fee structure are reasonable, equitably allocated, and not unreasonably discriminatory because they are consistent with the fee structure and fees charged by other exchanges with comparable market data products. As such, the Exchange believes it is adopting a model that is easily understood by Members and non-Members, most of which also subscribe to market data products from other exchanges, and that the proposed fees are consistent with the Act generally, and Section 6(b)(5)
The Exchange believes that the proposed fees for the Exchange Data Feeds are reasonable when compared to fees for comparable products at MEMX, MIAX Pearl, and Cboe BZX, as illustrated in the table above, given that in nearly all cases, the Exchange's proposed fees are the same as or lower than the fees charged by those other exchanges.
The Exchange believes that its proposed fees are reasonable, fair, and equitable, and not unfairly discriminatory because they are designed to align with services provided. The Exchange believes that the proposed fees are equitably allocated because they will apply uniformly to all data recipients that choose to subscribe to the Exchange Data Feeds. Any Firm that chooses to subscribe to one or more Exchange Data
The Exchange believes that the proposed fees are not unfairly discriminatory because they would apply to all data recipients that choose to subscribe to the same Exchange Data Feeds. Any subscriber that chooses to subscribe to the Exchange Data Feeds is subject to the same Fee Schedule, regardless of what type of business it operates. Because the proposed fees for the 24X Depth feed are higher, subscribers seeking lower cost options may instead choose to receive data from the Securities Information Processors or through the 24X Top and/or 24X Last Sale feeds for a lower cost. Alternatively, subscribers can choose to pay for the 24X Depth feed in order to receive data in a single feed with depth-of-book information if such information is valuable to them. The Exchange notes that subscribers can also choose to subscribe to a combination of data feeds for redundancy purposes or to use different feeds for different purposes. In sum, each subscriber has the ability to choose the best business solution for itself. The Exchange does not believe it is unfairly discriminatory to base pricing upon the amount of information contained in each data feed. As described above, the 24X Top and 24X Last Sale data feeds can be utilized to trade on the Exchange but contain less information than the 24X Depth feed (
In accordance with Section 6(b)(8) of the Act,
The Exchange does not believe that the proposed fees for Exchange Data Feeds place certain market participants at a relative disadvantage compared to other market participants because, as noted above, the decision to subscribe to any Exchange Data Feeds is optional and proposed fees are associated with the usage of Exchange Data Feeds by each market participant based on the type of business it operates. The fees associated with the Exchange Data Feeds are based on objective differences in usage of Exchange Data Feeds among different Firms, which are still ultimately in the control of each particular Firm, and such fees do not impose a barrier to entry to smaller participants. Accordingly, the proposed fees for Exchange Data Feeds do not favor certain categories of market participants in a manner that would impose a burden on competition; rather, the allocation of the proposed fees reflects the types of Exchange Data Feeds consumed by various market participants and their usage thereof.
The Exchange does not believe the proposed fees place an undue burden on competition on other SROs that is not necessary or appropriate. In particular, market participants are not forced to subscribe to any of the Exchange Data Feeds, as described above. Additionally, other exchanges have similar market data fees in place for their participants, but with comparable and in some cases higher rates for market data feeds.
No written comments were solicited or received with respect to the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Exchange Act”)
The proposed rule change
In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of this proposed rule change is to amend the Underwriting Guide and OA to (i) enhance the securities eligibility processes within DTC's Underwriting Service through implementation of a process called “Rapid Issuance,” (ii) update language and details to account for DTC's modernization process, including the technical migration of access to certain functions from one user interface to another, (iii) clarify requirements and practices in the confirmation process, and (iv) make technical, clarifying, and conforming changes.
DTC, through its Underwriting Service, supports the financial industry by making securities eligible for depository services. This enables Participants to distribute new and secondary offerings quickly and economically via electronic book-entry delivery and settlement through DTC. Most eligible securities are introduced into the DTC system through its Underwriting Department. Securities can be credited to the accounts of underwriters who are Participants or correspondents of Participants working through Participant accounts and distributed to the market by delivery to other Participants.
Only a Participant, or its correspondent, may submit a request to make a security eligible for DTC services. The Participant or correspondent (also referred to in the Underwriting Guide and OA as the “underwriter”) seeking to make a security eligible for DTC services must provide an eligibility request by submitting certain required issuer and securities data and related offering and other eligibility-related documents to DTC through a designated platform for a given security type. These platforms include the online Securities Origination, Underwriting and Reliable Corporate Action Environment (“UW SOURCE”) and Underwriting Central (“UWC”). UW SOURCE is currently used for processing eligibility requests of security types other than electronic certificates of deposit (“E-CDs”) and money market instruments (“MMI Securities”),
While existing processes allow for processing of eligibility requests for non-MMI Securities in an efficient manner, DTC has identified opportunities for enhancement. More specifically, the modern features of UWC present an opportunity for the development of the proposed Rapid Issuance process, which would provide more efficient processing for non-MMI Securities and can be issued continuously via shelf offerings,
UWC, a modern platform currently used for eligibility processing for E-CDs and MMI Securities, offers an integrated user experience that reduces the need for manual documentation processing outside the system. Its modern design also provides a foundation for future enhancements to eligibility services, as it is streamlined, resilient, and aligned with the needs and usability standards of Participants and issuers.
To expand the use of UWC's modern design and streamlined functionality, DTC proposes to implement Rapid Issuance for processing shelf offerings of non-MMI Securities. While continuously issued securities for non-MMI shelf offerings may be made eligible and issued through UW SOURCE or the MMI system today, Rapid Issuance will offer benefits over both systems for eligibility and issuance of non-MMI Securities.
A key benefit of Rapid Issuance involves streamlined eligibility processes, especially for those securities currently processing through UW SOURCE, which requires a new eligibility request per CUSIP.
Rapid Issuance will also accommodate complex payment structures typically associated with certain non-MMI Securities, such as structured notes, which may have floating rates, rather than more simple structures typical of MMI Securities. Eligible non-MMI Securities will benefit from such flexibility when offered through Rapid Issuance rather through other means.
DTC notes that implementation of Rapid Issuance will not preclude Participants or correspondents from making eligibility requests of non-MMI Securities via UW SOURCE or the MMI system in UWC, if the applicable non-MMI Securities are eligible for those systems today. Rather, Rapid Issuance provides an alternative and more specialized path to eligibility for certain non-MMI Securities, in addition to the existing methods. It is DTC's expectation that Participants and correspondents will transition over to Rapid Issuance given the benefits offered.
To implement Rapid Issuance, and make other technical and clarifying changes, the Underwriting Guide and OA would be amended as set forth below.
First, the Underwriting Guide's “New Issue Eligibility” section will be updated to reflect the ongoing modernization of DTC's systems and the availability of the Rapid Issuance system. The text will include a descriptive paragraph stating that UW SOURCE is the primary application for new issue eligibility requests. However, as part of an effort to modernize the Underwriting systems, UWC has been implemented for processing MMIs and E-CDs. It will also state that Rapid Issuance will be available through UWC for expedited eligibility of eligible non-MMI Securities.
Second, a subsection will be added describing Rapid Issuance and stating that it may be used for structured notes offered using the same base prospectus in a shelf offering.
Third, the section titled “Closings” will be updated for a technical change to reflect the current closing process for new issues. Prior to the creation of UWC, all new issuances required an underwriter and the agent for the issuer to participate in a closing call with DTC to confirm positions to be credited to the underwriter's account. Positions credited through UWC do not require a closing call but are confirmed systemically. Therefore, the text describing this process will be updated to clarify that closings for new issues submitted through UW SOURCE require a closing call with the underwriter and issuer's agent, while closing confirmations for issues submitted through UWC are made systemically using DTC's Securities Processing Application (“SPA”).
Fourth, text under the “Closings” section stating that it is the responsibility of the DTC Closing area to ensure that securities are credited to an underwriter's account will be updated to refer to the process of the issuer or its agent or underwriter confirming appropriate details with DTC. This change provides clarification that it is the parties effecting the issuance that proactively take action to ensure closing occurs.
Fifth, a subsection under “Closings” titled “Associated Participant Terminal Functions (PTS)” that lists related system functions would be revised. This section refers to the availability of the “FRAC” and “GWIZ” functions through DTC's Participant Terminal System (“PTS”). The FRAC function which allows an agent to confirm or reject the balance of securities being issued, as set forth on a FAST Underwriting Shipment Control List,
First, Section II.A.1.a. (MMI CUSIPS), which currently provides the requirements relating to CUSIP Lists for MMI Securities, will be updated to reflect the addition of Rapid Issuance and related CUSIP List requirements. It will include the requirements that the issuer or underwriter making an eligibility request for a non-MMI Security via Rapid Issuance must obtain a CUSIP List from CUSIP Global Services and require an additional CUSIP List to be obtained once a certain number of CUSIPs remain unassigned. Consistent with the current
Second, Section I.A.1. (Submission of an Eligibility Request to DTC), which outlines the responsibilities of agents in confirming the features and attributes of new securities issued through DTC's Underwriting Department, will be revised. Specifically, the paragraph, which previously focused on the confirmation process for UW SOURCE requests, will clarify agent responsibilities and specify how agents must complete a confirmation of the securities' features and attributes provided by the underwriter for both UW SOURCE and UWC submissions. It will clarify that the agent confirmation for UW SOURCE submissions must be supplied by email to DTC's Underwriting Department. This email will confirm the new issue's features and attributes based on the security type. The paragraph will also include a reference to a new “Asset Services Central” portal,
Third, consistent with the changes relating to FRAC described above, Sections II.B.1. (Possession and Inspection) will be updated to reflect that confirmations made using FRAC will be performed on SPA, rather than PTS and PBS.
Fourth, Section II.B.2.b.(FRAC) will be revised to clarify text relating to closing on an issue. The text will be revised to clearly state that a Participant will not be credited unless DTC's Underwriting Department receives confirmation that the underwriter and the agent agree on the number of securities to be issued.
Fifth, Exhibit B of the OA, which contains a table of “Underwriting Standard Time Frames” with headings for “information and/or Materials Needed” (“Column A”) and Time Frame (“Column B”) will be amended for technical and clarifying changes as follows:
a. A subheading stating that the table contains “Information and/or Materials Needed by DTC to Process an Underwriting and Notify Participants in a Timely Fashion” would be revised to replace “Underwriting” with “Eligibility Submission” and “Notify DTC Participants” with “Close the Issuance.” This change more accurately reflects the activity the table is intended to cover.
b. An entry in Column A containing a note referring to UW SOURCE as indicating to a submitter the data that is required with a submission, will be revised to replace “UW SOURCE” with “The DTC user interfaces.” This change reflects the availability of UWC for certain issuance types.
c. An entry in column A referring to confirmations via FRAC will be revised to reflect that FRAC is available on SPA rather than PBS. A corresponding entry in Column B stating “. . . in no event will credit be given to a Participant's account without the Underwriting Department having received closing call information from the underwriter and Agent” will be revised to state “. . . in no event will credit be given to a Participant's account without the Underwriting Department having received confirmation from both the underwriter and Agent that they are in agreement on the positions to be credited to the underwriter's account.” This change makes the text consistent with a change described above where details of UWC closings are provided systemically and do not require a closing call, and also clarifies that the underwriter and agent must agree.
The proposed rule change would be implemented on November 3, 2025.
DTC believes that the proposed rule change is consistent with the requirements of the Exchange Act, and the rules and regulations thereunder applicable to a registered clearing agency. Specifically, DTC believes that the proposed rule change is consistent with Section 17A(b)(3)(F) of the Exchange Act
Section 17A(b)(3)(F) of the Exchange Act requires, in part, that the rules of a clearing agency, such as DTC, be designed to promote the prompt and accurate clearance and settlement of securities transactions.
These proposed amendments to the Underwriting Guide are designed to enhance the efficiency and accuracy of the clearance and settlement of securities transactions. By modernizing the systems and processes involved in new issue eligibility and closing procedures, these changes aim to streamline operations and reduce the potential for errors.
First, the update to the “New Issue Eligibility” section reflects the integration of the Rapid Issuance system and the implementation of UWC for processing MMIs and E-CDs. This modernization effort ensures that new issue eligibility requests are processed more swiftly and accurately.
Second, the addition of a subsection on Rapid Issuance for Securities using the same base prospectus in a shelf offering introduces a more efficient process for prequalifying non-MMI CUSIPs. This allows for expedited issuance of securities, thereby promoting prompt and accurate settlement.
Third, the changes to the “Closings” section clarify the current closing process for new issues. By eliminating the need for a closing call for positions credited through UWC and confirming these positions systemically, the amendments reduce the time and effort required for closing transactions, enhancing overall efficiency.
Fourth, the clarification in the “Closings” section that the responsibility for ensuring securities are credited to an underwriter's account lies with the issuer or its agent or underwriter emphasizes the proactive role of these parties in the closing process. This change ensures that all parties involved are aware of their responsibilities, thereby reducing the risk of errors and delays.
Last, the revision of the “Associated Participant Terminal Functions (PTS)” section to reflect the proposed migration of the FRAC function from PTS to SPA and the renaming of GWIZ to Security Detail and its availability on PBS ensures that the guide accurately represents functions that would be in use and how they are accessed. Renaming the section as “Associated Functions” provides clarity that the
The proposed amendments to the OA are also designed to enhance the efficiency and accuracy of the clearance and settlement of securities transactions.
First, the update to Section II.A.1.a. (MMI CUSIPS) reflects the addition of Rapid Issuance and related CUSIP List requirements. This modernization effort ensures that new issue eligibility requests are processed more swiftly and accurately, leveraging the capabilities of Rapid Issuance.
Second, the revision to Section I.A.1. (Submission of an Eligibility Request to DTC) outlines the responsibilities of agents in confirming the features and attributes of new securities issued through DTC's Underwriting Department. By clarifying agent responsibilities and specifying how agents must complete a confirmation of the securities' features and attributes provided by the underwriter for both UW SOURCE and UWC submissions, the amendments ensure that new issue eligibility requests are processed accurately and efficiently. The agent confirmation for UW SOURCE submissions will be supplied by email from DTC's Underwriting Department, confirming the new issue's features and attributes based on the security type. Additionally, the introduction of the “Asset Services Central” portal for systemic confirmation of securities issued through UWC further streamlines the process, reducing the potential for errors and delays.
Third, consistent with the changes relating to FRAC described above, Section II.B.1. (Possession and Inspection) will be updated for a technical change to reflect that FRAC is now performed on SPA, rather than PTS and PBS. This update ensures that the guide accurately represents the current systems in use, promoting the accurate processing of securities transactions by providing clear and up-to-date information on the available functions.
Fourth, Section II.B.2.b. will be revised to clarify text relating to closing on an issue. By clearly stating that a Participant will not be credited unless DTC's Underwriting Department receives confirmation that the underwriter and the agent agree on the number of securities to be issued, the amendments reduce the risk of errors and delays in the closing process. This clarification ensures that all parties involved are aware of their responsibilities, thereby promoting the prompt and accurate settlement of securities transactions.
Last, the modifications to Exhibit B ensure that the information and materials needed for processing are clearly defined and updated to reflect current practices. By revising the subheading to specify “Eligibility Submission” and “Close the Issuance,” it accurately describes the activities covered by the table, reducing ambiguity. The change from “UW SOURCE” to “The DTC user interfaces” reflects the availability of UWC for certain issuance types, ensuring that users are aware of the correct platforms to use. Additionally, updating the reference from FRAC on PTS to FRAC on SPA directs users to the correct system for confirmations. The revision to the entry in Column B clarifies that credit will only be given when both the underwriter and agent are in agreement on related details, ensuring consistency and accuracy in the information provided. These changes collectively enhance the efficiency and reliability of the underwriting process, thereby supporting the timely and accurate settlement of securities transactions.
Overall, these amendments are intended to promote the prompt and accurate clearance and settlement of securities transactions by modernizing and clarifying the processes and systems involved. Therefore, the Clearing Agencies believe the proposed changes described above are consistent with Section 17A(b)(3)(F) of the Exchange Act.
DTC does not believe that the proposed changes to the Underwriting Guide and OA, as described above, will have any impact, or impose any burden, on competition.
The proposed amendments apply equally to all affected Participants, issuers and agents, ensuring that the benefits of enhanced efficiency and accuracy are available to all users without additional cost or effort, except for user testing. In addition, use of Rapid Issuance will be voluntary. To the extent issues are eligible for processing through UW SOURCE or the MMI system, they can still be processed as such. Therefore, DTC does not believe that the proposed rule change would impose a burden on competition.
The DTC has not received or solicited any written comments relating to this proposal. If any written comments are received, DTC will amend its filing to publicly file such comments as an Exhibit 2 to its filing, as required by Form 19b-4 and the General Instructions thereto.
Persons submitting written comments are cautioned that, according to Section IV (Solicitation of Comments) of the Exhibit 1A in the General Instructions to Form 19b-4, the Commission does not edit personal identifying information from comment submissions. Commenters should submit only information that they wish to make available publicly, including their name, email address, and any other identifying information.
All prospective commenters should follow the Commission's instructions on
DTC reserves the right to not respond to any comments received.
Because the foregoing proposed rule change does not:
(i) significantly affect the protection of investors or the public interest;
(ii) impose any significant burden on competition; and
(iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Exchange Act
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 Exchange Act.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to set fees for the purchase of field-programmable gate array (“FPGA”) technology as an optional delivery mechanism for the Nasdaq GEMX Depth of Market Data Feed.
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to establish a fee schedule for the purchase of field-programmable gate array (“FPGA”) technology as an optional delivery mechanism for the Nasdaq GEMX Depth of Market Data Feed (“Depth of Market Feed”).
FPGA is a hardware-based delivery mechanism that utilizes an integrated circuit that is programmed to reduce “jitter”—a technical term of art referring to the deviation in amplitude, phase timing or width of a signal pulse in a digital signal—that will allow data to be processed in a more predictable, or
The benefits of determinism depend on the use case of the customer, as well as the customer's specific system architecture.
Higher determinism does not necessarily mean lower latency. The concepts of determinism and latency are related, but distinct. Determinism refers to predictability in the rate of data transmission; latency refers to the time required to process data or transport it from one location to another. Low latency is not necessarily deterministic, and higher determinism does not necessarily mean low latency. As such, use of FPGA technology will increase determinism, but does not guarantee lower latency.
Among customers that seek a higher degree of determinism, the benefits of FPGA technology vary, as FPGA technology is one possible solution, among a catalog of possible solutions, for increasing the consistency and predictability of message throughput over the course of the trading day. Some customers are able to adequately control jitter without using FPGA technology; other customers address jitter using specialized software, coding or other design solutions in conjunction with FPGA; still others use FPGA alone. The specific choice depends on a complex analysis of the customer's information technology systems in the context of their particular use cases.
FPGA is a broadly available, commonly used type of programmable circuit that can be modified to suit different use cases. It is used in a wide spectrum of industries, including consumer electronics, automotive, and aerospace, as well as in a variety of industrial applications. It is not unique to the financial services industry,
FPGA technology has been offered by both the Nasdaq Stock Exchange and the Nasdaq Options Market for over a decade,
The Exchange proposes to offer the GEMX FPGA service in conjunction with the Exchange's Depth of Market Feed.
Customers that choose to purchase the Depth of Market Feed without the GEMX service will receive the same data as customers that elect to purchase the Depth of Market Feed with the GEMX FPGA service.
The proposal to offer optional FPGA technology to customers of the GEMX Depth of Market Feed is in response to customer demand.
GEMX proposes separate fees for internal and external distribution for Hardware-Based Delivery of its Depth of Market Feed. The term “Hardware-Based Delivery” means that a distributor is processing data sourced from a hardware-coded market data format such as FPGA technology. Proposed fees are $8,000 per month per distributor for internal only distribution, $1,000 per month per distributor for external only distribution, and the sum of those two fees, $9,000 per month, for both internal and external distribution.
Customers that elect to receive the Depth of Market Feed without the FPGA service will pay no fee in addition to the underlying fees listed above.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The proposal provides for the equitable allocation of reasonable dues, fees, and other charges because: (i) FPGA technology will facilitate the ingestion of information for some customers; (ii) the proposed service is entirely optional and any customer can choose to purchase or not for any reason, including the fees charged; and (iii) the proposed fees are comparable to those charged by similarly situated options exchanges.
As explained above, FPGA is a hardware-based delivery mechanism that utilizes an integrated circuit that is programmed to reduce jitter, allowing data to be processed in a more deterministic fashion. This can be useful for certain customers, depending on the use case of the customer and the customer's system architecture. This service is not available today on the GEMX exchange, and the proposal will therefore enhance the service offerings for certain customers, as described above. The Exchange is aware of a number of customers have expressed interest in purchasing the FPGA service from this Exchange.
The FPGA Service is optional for all categories of customers. No customer and no category of customers (such as, for example, proprietary trading firms, banks, or market makers) are required to purchase the FPGA Service for either legal or technological reasons—even a customer that seeks to reduce jitter.
In the experience of the Nasdaq Options Market, the FPGA Service is purchased by market makers, wholesalers, proprietary trading firms, banks, and others. The Nasdaq exchange is aware of no systematic differences within any of these categories among market participants that choose to use or not to use the Nasdaq FPGA Service.
Customers may choose not to use FPGA technology at all. As noted above, FPGA technology processes data at a consistently predictable rate relative to software. This predictability in the rate of processing may not be advantageous or optimal for all systems receiving the exchange data feed.
The design of data processing architecture is complex. The ingestion of data from an exchange is just one step in the lifecycle of trading. Customers must generate and submit orders, evaluate trades, and then generate new orders while interacting with multiple exchanges. All of these steps are part of a single trading system. Changing any one step in the process—by, for example, purchasing the Exchange's FPGA Service when other exchanges may not offer FPGA—often results in the need for changes to other aspects of the process. As such, the decision to buy the Exchange's FPGA Service will be based on whether the service is compatible with the customer's trading system as a whole, not just on whether it may facilitate the processing of data from a single exchange. The appropriateness of any particular solution will depend on the customer's system architecture, and the specific use cases for the market data consumed.
Even if a customer chooses to use FPGA technology, purchase from the Exchange is only one of several options available, as such technology is not unique to the Exchange or even the financial services industry. Third-party data vendors offer FPGA technology services, or a customer may purchase and deploy its own FPGA hardware, without purchasing the proposed FPGA technology service from the Exchange,
Over ten years of experience in selling the FPGA Service for the Nasdaq Options Market (“NOM”) has shown that the majority of depth of book customers—over 80 percent—do not use Nasdaq's FPGA Service.
The NOM experience also shows that customer demand changes over time, even for customers that continue to purchase depth of book information. Of the firms that purchased but later cancelled the FPGA service at NOM, approximately 66% continued to purchase depth of market data even after they cancelled FPGA, demonstrating that customers can discontinue the use of the FPGA Service at any time, for any reason.
Customers that choose to purchase the Depth of Market Feed without the GEMX FPGA service will receive the same data as customers that elect to purchase the Depth of Market Feed with the GEMX FPGA service.
The proposed fees for the GEMX FPGA service are comparable to those currently charged for the use of FPGA technology in the Nasdaq Options Market based on market share. No other options exchange currently offers FPGA technology as a separate service.
The Exchange has assessed the market share
FPGA fees for the Nasdaq Options Market are currently $10,530 for internal only distribution, $1,000 for use in external only distribution, and the sum of those two fees, $11,530, for both internal and external distribution.
The difference in internal distribution fees reflects the underlying difference in market share. GEMX is proposing fees of $8,000 per month for internal distribution as compared to $10,530 for the Nasdaq Options Market. The lower fee reflects GEMX's market share of 3.1% as compared to NOM's market share of 5.3%. Because NOM has more liquidity than GEMX, NOM charges more than GEMX for FPGA hardware to account for the greater amount of information being processed. Because the differences between the GEMX and NOM fees are reasonably related to market share, the fees are comparable.
With respect to external only distribution, the proposed GEMX fees of $1,000 are the same as those charged for the Nasdaq Options Market and Nasdaq proposes that they remain consistent across all options exchanges. This is because the external FPGA service is primarily used to provide two or more firms with the option of sharing the benefits of that technology. The external distribution fee allows them to do so, providing more options for configuring this service. As such, it is reasonable to charge a flat fee for this service without regard to market share, and the proposed ISE fees are therefore comparable to the fees currently charged by NOM.
The combined fees for both are the sum of the fees for internal and external distribution, respectively. As both component fees are comparable, the sum is also comparable.
The Proposal is not unfairly discriminatory. The FPGA Service will be available to all customers on a non-discriminatory basis, and therefore the proposed fees are not designed to permit unfair discrimination between customers, issuers, brokers, or dealers.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
Nothing in the Proposal burdens inter-market competition (the competition among self-regulatory organizations) because approval of the Proposal does not impose any burden on the ability of other exchanges to compete. As noted above, FPGA technology is generally available and any exchange has the ability to offer such technology if it chooses.
Nothing in the Proposal burdens intra-market competition (the competition among consumers of exchange data) because the FPGA Service will be available to any customer under the same fee schedule as any other customer, and any market participant that wishes to purchase the FPGA Service can do so on a non-discriminatory basis.
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to establish a fee schedule for the purchase of field-programmable gate array (“FPGA”) technology as an optional delivery mechanism for the Nasdaq MRX Depth of Market Data Feed (“Depth of Market Feed”).
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to establish a fee schedule for the purchase of field-programmable gate array (“FPGA”) technology as an optional delivery mechanism for the Nasdaq MRX Depth of Market Data Feed (“Depth of Market Feed”).
FPGA is a hardware-based delivery mechanism that utilizes an integrated circuit that is programmed to reduce
The benefits of determinism depend on the use case of the customer, as well as the customer's specific system architecture.
Higher determinism does not necessarily mean lower latency. The concepts of determinism and latency are related, but distinct. Determinism refers to predictability in the rate of data transmission; latency refers to the time required to process data or transport it from one location to another. Low latency is not necessarily deterministic, and higher determinism does not necessarily mean low latency. As such, use of FPGA technology will increase determinism, but does not guarantee lower latency.
Among customers that seek a higher degree of determinism, the benefits of FPGA technology vary, as FPGA technology is one possible solution, among a catalog of possible solutions, for increasing the consistency and predictability of message throughput over the course of the trading day. Some customers are able to adequately control jitter without using FPGA technology; other customers address jitter using specialized software, coding or other design solutions in conjunction with FPGA; still others use FPGA alone. The specific choice depends on a complex analysis of the customer's information technology systems in the context of their particular use cases.
FPGA is a broadly available, commonly used type of programmable circuit that can be modified to suit different use cases. It is used in a wide spectrum of industries, including consumer electronics, automotive, and aerospace, as well as in a variety of industrial applications. It is not unique to the financial services industry,
FPGA technology has been offered by both the Nasdaq Stock Exchange and the Nasdaq Options Market for over a decade,
The Exchange proposes to offer the MRX FPGA service in conjunction with the Exchange's Depth of Market Feed.
Customers that choose to purchase the Depth of Market Feed without the MRX FPGA service will receive the same data as customers that elect to purchase the Depth of Market Feed with the MRX FPGA service.
The proposal to offer optional FPGA technology to customers of the MRX FPGA service is in response to customer demand.
MRX proposes separate fees for internal and external distribution for Hardware-Based Delivery of its Depth of Market Feed. The term “Hardware-Based Delivery” means that a distributor is processing data sourced from a hardware-coded market data format such as FPGA technology. Proposed fees are $8,000 per month per distributor for internal only distribution, $1,000 per month per distributor for external only distribution, and the sum of those two fees, $9,000 per month, for both internal and external distribution.
Customers that elect to receive the Depth of Market Feed without the FPGA service will pay no fee in addition to the underlying fees listed above.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The proposal provides for the equitable allocation of reasonable dues, fees, and other charges because: (i) FPGA technology will facilitate the ingestion of information for some customers; (ii) the proposed service is entirely optional and any customer can choose to purchase or not for any
As explained above, FPGA is a hardware-based delivery mechanism that utilizes an integrated circuit that is programmed to reduce jitter, allowing data to be processed in a more deterministic fashion. This can be useful for certain customers, depending on the use case of the customer and the customer's system architecture. This service is not available today on the MRX exchange, and the proposal will therefore enhance the service offerings for certain customers, as described above. The Exchange is aware of a number of customers have expressed interest in purchasing the FPGA service from this Exchange.
The FPGA Service is optional for all categories of customers. No customer and no category of customers (such as, for example, proprietary trading firms, banks, or market makers) are required to purchase the FPGA Service for either legal or technological reasons—even a customer that seeks to reduce jitter.
In the experience of the Nasdaq Options Market, the FPGA Service is purchased by market makers, wholesalers, proprietary trading firms, banks, and others. The Nasdaq exchange is aware of no systematic differences within any of these categories among market participants that choose to use or not to use the Nasdaq FPGA Service.
Customers may choose not to use FPGA technology at all. As noted above, FPGA technology processes data at a consistently predictable rate relative to software. This predictability in the rate of processing may not be advantageous or optimal for all systems receiving the exchange data feed.
The design of data processing architecture is complex. The ingestion of data from an exchange is just one step in the lifecycle of trading. Customers must generate and submit orders, evaluate trades, and then generate new orders while interacting with multiple exchanges. All of these steps are part of a single trading system. Changing any one step in the process—by, for example, purchasing the Exchange's FPGA Service when other exchanges may not offer FPGA—often results in the need for changes to other aspects of the process. As such, the decision to buy the Exchange's FPGA Service will be based on whether the service is compatible with the customer's trading system as a whole, not just on whether it may facilitate the processing of data from a single exchange. The appropriateness of any particular solution will depend on the customer's system architecture, and the specific use cases for the market data consumed.
Even if a customer chooses to use FPGA technology, purchase from the Exchange is only one of several options available, as such technology is not unique to the Exchange or even the financial services industry. Third-party data vendors offer FPGA technology services, or a customer may purchase and deploy its own FPGA hardware, without purchasing the proposed FPGA technology service from the Exchange,
Over ten years of experience in selling the FPGA Service for the Nasdaq Options Market (“NOM”) has shown that the majority of depth of book customers—over 80 percent—do not use Nasdaq's FPGA Service.
The NOM experience also shows that customer demand changes over time, even for customers that continue to purchase depth of book information. Of the firms that purchased but later cancelled the FPGA service at NOM, approximately 66% continued to purchase depth of market data even after they cancelled FPGA, demonstrating that customers can discontinue the use of the FPGA Service at any time, for any reason.
Customers that choose to purchase the Depth of Market Feed without the MRX FPGA service will receive the same data as customers that elect to purchase the Depth of Market Feed with the MRX FPGA service.
The proposed fees for the MRX FPGA service are comparable to those currently charged for the use of FPGA technology in the Nasdaq Options Market based on market share. No other options exchange currently offers FPGA technology as a separate service.
The Exchange has assessed the market share
FPGA fees for the Nasdaq Options Market are currently $10,530 for internal only distribution, $1,000 for use in external only distribution, and the sum of those two fees, $11,530, for both internal and external distribution.
The difference in internal distribution fees reflects the underlying difference in market share. MRX is proposing fees of $8,000 per month for internal distribution as compared to $10,530 for the Nasdaq Options Market. The lower fee reflects MRX's market share of 2.8% as compared to NOM's market share of 5.3%. Because NOM has more liquidity than GEMX, NOM charges more than GEMX for FPGA hardware to account for the larger number of transactions processed. GEMX and NOM fees are therefore comparable.
With respect to internal only distribution, the proposed MRX fees of $1,000 are the same as those charged for the Nasdaq Options Market, and Nasdaq proposes that they remain consistent across all options exchanges. This is because the external FPGA service is primarily used to provide two or more firms with the option of sharing the benefits of that technology. The external distribution fee allows them to do so, providing more options for configuring this service. As such, it is reasonable to charge a flat fee for this service without regard to market share, and the proposed ISE fees are therefore comparable to the fees currently charged by NOM.
The combined fees for both are the sum of the fees for internal and external distribution, respectively. As both component fees are comparable, the sum is also comparable.
The Proposal is not unfairly discriminatory. The FPGA Service will be available to all customers on a non-discriminatory basis, and therefore the proposed fees are not designed to permit unfair discrimination between customers, issuers, brokers, or dealers.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
Nothing in the Proposal burdens inter-market competition (the competition among self-regulatory organizations) because approval of the Proposal does not impose any burden on the ability of other exchanges to compete. As noted above, FPGA technology is generally available and any exchange has the ability to offer such technology if it chooses.
Nothing in the Proposal burdens intra-market competition (the competition among consumers of exchange data) because the FPGA Service will be available to any customer under the same fee schedule as any other customer, and any market participant that wishes to purchase the FPGA Service can do so on a non-discriminatory basis.
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to amend the Exchange's Pricing Schedule at Options 7, Section 3, Table 1 to offer a rebate for eligible Members that add liquidity in Penny Symbols, as described further below.
The Exchange initially filed the proposed pricing changes on September 2, 2025 (SR-MRX-2025-18). On September 11, 2025, the Exchange withdrew that filing and submitted this filing.
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to amend the Exchange's Pricing Schedule at Options 7, Section 3, Table 1 to offer a rebate for eligible Members that add liquidity in Penny Symbols. The Exchange initially filed the proposed pricing changes on September 2, 2025 (SR-MRX-2025-18). On September 11, 2025, the Exchange withdrew that filing and submitted this filing.
Today, the Exchange assesses all Non-Priority Customers
As proposed, this note 2 incentive would only apply to Members that achieve Tier 4 and meet the proposed qualifications in note 2. Effectively, for example, a qualifying Non-Priority Customer under the proposed note 2 incentive would pay $0.48 per contract for all their Penny Symbol transactions adding liquidity for that month (
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The Exchange's proposed changes to its Pricing Schedule are reasonable in several respects. As a threshold matter, the Exchange is subject to significant competitive forces in the market for options securities transaction services that constrain its pricing determinations in that market. The fact that this market is competitive has long been recognized by the courts. In
The Commission and the courts have repeatedly expressed their preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. In Regulation NMS, while adopting a series of steps to improve the current market model, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system “has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.”
Numerous indicia demonstrate the competitive nature of this market. For example, clear substitutes to the Exchange exist in the market for options security transaction services. The Exchange is only one of eighteen options exchanges to which market participants may direct their order flow. Within this environment, market participants can freely and often do shift their order flow among the Exchange and competing venues in response to changes in their respective pricing schedules. As such, the proposal represents a reasonable attempt by the Exchange to increase its liquidity and market share relative to its competitors.
The Exchange believes that it is reasonable to provide Members in Tier 4 the proposed $0.02 per contract Penny Symbol rebate if they add liquidity greater than or equal to 50% of their Total Affiliated Member or Affiliated Entity Volume because the Exchange seeks to incentivize Members to add greater liquidity on the Exchange in Penny Symbols in order to obtain the proposed rebate. By requiring Members to meet both the highest Tier 4 volume requirement and a significant add liquidity component (at least 50% of their Total Affiliated Member or Affiliated Entity Volume), the proposed incentive could potentially encourage more trading activity and additional liquidity on MRX. This, in turn, could improve overall market quality for all market participants through more trading opportunities and tighter spreads. The Exchange also believes that setting the proposed threshold at 50%, as discussed above, is reasonable because this could encourage Members to aggregate volume and add liquidity as the majority of their overall activity in Penny Symbols on the Exchange. The Exchange also believes it is reasonable to have the note 2 incentive be available through December 31, 2025 so that the Exchange can use the time period in between to consider the benefits of the program and evaluate whether to extend. The Exchange believes that this four month period will provide sufficient time for the Exchange to evaluate the incentive and Members' responses to it.
The Exchange further believes that the proposed note 2 incentive is equitable and not unfairly discriminatory because the proposed incentive will be provided uniformly to all similarly situated market participants. Any Member may qualify for Tier 4 by meeting the volume requirements for that tier. The Exchange believes that requiring all Members to add liquidity greater than or equal to 50% of their Total Affiliated Member or Affiliated Entity Volume to receive the $0.02 rebate is equitable and not unfairly discriminatory because the proposal applies a uniform percentage threshold across all Members. While Members may begin from different absolute trading levels, each is measured against its own Total Affiliated Member or Affiliated Entity activity on the Exchange. This ensures that all Members are evaluated by the same proportionate standard, rather than one group being held to stricter or looser requirements based on absolute volume thresholds. By applying a consistent percentage requirement, the proposal ensures that every Member seeking the proposed note 2 incentive must demonstrate a comparable level of commitment to add liquidity relative to its total activity on the Exchange. Furthermore, the proposed incentive will be temporary and will only be available through December 31, 2025, after which the Exchange must come in with another rule filing if it wishes to extend this incentive. To the extent the proposed incentive attracts additional liquidity on the Exchange during this
The Exchange notes that Priority Customers will continue to receive more favorable pricing under the proposal, as discussed above. The Exchange does not believe its proposal is unfairly discriminatory as the Exchange has historically provided more favorable pricing to Priority Customers.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
In terms of intra-market competition, the proposed changes to provide the note 2 incentive to Tier 4 Members do not impose an undue burden on competition because any Member may qualify for Tier 4 by meeting the volume requirements for that tier. As discussed above, the proposal applies a uniform percentage threshold across all Members, which the Exchange believes will ensure that every Member seeking the proposed note 2 incentive will demonstrate a comparable level of commitment to add liquidity relative to its total activity on the Exchange. While Priority Customers will continue to receive more favorable pricing under the proposal, the Exchange does not believe that this is unfairly discriminatory because the Exchange has historically provided more favorable pricing to Priority Customers.
In terms of inter-market competition, the Exchange 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, or rebate opportunities available at other options exchanges to be more favorable. In such an environment, the Exchange must continually adjust its fees to remain competitive with other options exchanges. Because competitors are free to modify their own fees in response, and because market participants may readily adjust their order routing practices, the Exchange believes that the degree to which fee changes in this market may impose any burden on competition is extremely limited. In sum, if the changes proposed herein are unattractive to market participants, it is likely that the Exchange will lose market share as a result. Accordingly, the Exchange does not believe that the proposed changes will impair the ability of members or competing order execution venues to maintain their competitive standing in the financial markets.
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to establish a fee schedule for the purchase of field-programmable gate array (“FPGA”) technology as an optional delivery mechanism for the ISE Real-time Depth of Market Raw Data Feed (“Depth of Market Feed”).
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to establish a fee schedule for the purchase of field-programmable gate array (“FPGA”) technology as an optional delivery mechanism for the ISE Real-time Depth of Market Raw Data Feed (“Depth of Market Feed”).
FPGA is a hardware-based delivery mechanism that utilizes an integrated circuit that is programmed to reduce “jitter”—a technical term of art referring to the deviation in amplitude, phase timing or width of a signal pulse in a digital signal—that will allow data to be processed in a more predictable, or “deterministic,” fashion. Reducing jitter can be useful for certain customers due to the variability in the timing of market data packets transmitted by an exchange over the course of the trading day. Orders, and therefore market data packets, typically accumulate in larger numbers at the beginning and end of the trading day, as well as during the peaks of activity that occur at random intervals during the day. These bursts of activity may alter the time interval between the delivery of data packets because software processes information at variable rates depending on load to the system. Processing times may increase at higher loads, and decrease during periods of lesser activity. FPGA technology processes data packets at a constant time interval, without regard to the number of packets processed. Higher levels of determinism means less variable queuing, which improves the predictability of data transfer, particularly during times of peak market activity.
The benefits of determinism depend on the use case of the customer, as well as the customer's specific system architecture.
Higher determinism does not necessarily mean lower latency. The concepts of determinism and latency are related, but distinct. Determinism refers to predictability in the rate of data transmission; latency refers to the time required to process data or transport it from one location to another. Low latency is not necessarily deterministic, and higher determinism does not necessarily mean low latency. As such, use of FPGA technology will increase determinism, but does not guarantee lower latency.
Among customers that seek a higher degree of determinism, the benefits of FPGA technology vary, as FPGA technology is one possible solution, among a catalog of possible solutions, for increasing the consistency and predictability of message throughput over the course of the trading day. Some customers are able to adequately control jitter without using FPGA technology; other customers address jitter using specialized software, coding or other design solutions in conjunction with FPGA; still others use FPGA alone. The specific choice depends on a complex analysis of the customer's information technology systems in the context of their particular use cases.
FPGA is a broadly available, commonly used type of programmable circuit that can be modified to suit different use cases. It is used in a wide spectrum of industries, including consumer electronics, automotive, and aerospace, as well as in a variety of industrial applications. It is not unique to the financial services industry,
FPGA technology has been offered by both the Nasdaq Stock Exchange and the Nasdaq Options Market for over a decade,
The Exchange proposes to offer the ISE FPGA service in conjunction with the Exchange's Depth of Market Feed.
Customers that choose to purchase the Depth of Market Feed without the ISE FPGA service will receive the same data as customers that elect to purchase the Depth of Market Feed with the ISE FPGA service.
The proposal to offer optional FPGA technology to customers of the ISE Depth of Market Feed is in response to customer demand.
ISE proposes separate fees for internal and external distribution for Hardware-Based Delivery of its Real-time Depth of Market Data Feed. The term “Hardware-Based Delivery” means that a distributor is processing data sourced from a hardware-coded market data format such as FPGA technology. Proposed fees are $12,500 per month per distributor for internal only distribution, $1,000 per month per distributor for external only distribution, and the sum of those two fees, $13,500 per month, for both internal and external distribution.
Customers that elect to receive the Depth of Market Feed without the FPGA service will pay no fee in addition to the underlying fees listed above.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The proposal provides for the equitable allocation of reasonable dues, fees, and other charges because: (i) FPGA technology will facilitate the ingestion of information for some customers; (ii) the proposed service is entirely optional and any customer can choose to purchase or not for any reason, including the fees charged; and (iii) the proposed fees are comparable to those charged by similarly situated options exchanges.
As explained above, FPGA is a hardware-based delivery mechanism that utilizes an integrated circuit that is programmed to reduce jitter, allowing data to be processed in a more deterministic fashion. This can be useful for certain customers, depending on the use case of the customer and the customer's system architecture. This service is not available today on the ISE exchange, and the proposal will therefore enhance the service offerings for certain customers, as described above. The Exchange is aware of a number of customers have expressed interest in purchasing the FPGA service from this Exchange.
The FPGA Service is optional for all categories of customers. No customer and no category of customers (such as, for example, proprietary trading firms, banks, or market makers) are required to purchase the FPGA Service for either legal or technological reasons—even a customer that seeks to reduce jitter.
In the experience of the Nasdaq Options Market, the FPGA Service is purchased by market makers, wholesalers, proprietary trading firms, banks, and others. The Nasdaq exchange is aware of no systematic differences within any of these categories among market participants that choose to use or not to use the Nasdaq FPGA Service.
Customers may choose not to use FPGA technology at all. As noted above, FPGA technology processes data at a consistently predictable rate relative to software. This predictability in the rate of processing may not be advantageous or optimal for all systems receiving the exchange data feed.
The design of data processing architecture is complex. The ingestion of data from an exchange is just one step in the lifecycle of trading. Customers must generate and submit orders, evaluate trades, and then generate new orders while interacting with multiple exchanges. All of these steps are part of a single trading system. Changing any one step in the process—by, for example, purchasing the Exchange's FPGA Service when other exchanges may not offer FPGA—often results in the need for changes to other aspects of the process. As such, the decision to buy the Exchange's FPGA Service will be based on whether the service is compatible with the customer's trading system as a whole, not just on whether it may facilitate the processing of data from a single exchange. The appropriateness of any particular solution will depend on the customer's system architecture, and the specific use cases for the market data consumed.
Even if a customer chooses to use FPGA technology, purchase from the Exchange is only one of several options available, as such technology is not unique to the Exchange or even the financial services industry. Third-party data vendors offer FPGA technology services, or a customer may purchase and deploy its own FPGA hardware, without purchasing the proposed FPGA technology service from the Exchange,
Over ten years of experience in selling the FPGA Service for the Nasdaq Options Market (“NOM”) has shown that the majority of depth of book
The NOM experience also shows that customer demand changes over time, even for customers that continue to purchase depth of book information. Of the firms that purchased but later cancelled the FPGA service at NOM, approximately 66% continued to purchase depth of market data even after they cancelled FPGA, demonstrating that customers can discontinue the use of the FPGA Service at any time, for any reason.
Customers that choose to purchase the Depth of Market Feed without the ISE FPGA service will receive the same data as customers that elect to purchase the Depth of Market Feed with the ISE FPGA service.
The proposed fees for the ISE FPGA service are comparable to those currently charged for the use of FPGA technology in the Nasdaq Options Market. No other options exchange currently offers FPGA technology as a separate service.
The Exchange has assessed the market share
FPGA fees for the Nasdaq Options Market are currently $10,530 for internal only distribution, $1,000 for use in external only distribution, and the sum of those two fees, $11,530, for both internal and external distribution.
The difference in internal distribution fees reflect the underlying difference in market share. While ISE is proposing fees of $12,500 per month for internal distribution as compared to $10,530 for the Nasdaq Options Market, ISE has a market share of 6.9% as compared to NOM's market share of 5.3%. Because ISE has approximately one third more liquidity than NOM, it charges somewhat more than NOM for FPGA hardware to account for the larger number of transactions processed. Because the differences between the ISE and NOM fees are reasonably related to market share, the fees are comparable.
With respect to external only distribution, the proposed ISE fees of $1,000 are the same as those charged for the Nasdaq Options Market, and Nasdaq proposes that they remain consistent across all options exchanges. This is because the external FPGA service is primarily used to provide two or more firms with the option of sharing the benefits of that technology. The external distribution fee allows them to do so, providing more options for configuring this service. As such, it is reasonable to charge a flat fee for this service without regard to market share, and the proposed ISE fees are therefore comparable to the fees currently charged by NOM.
The combined fees for both are the sum of the fees for internal and external distribution, respectively. As both component fees are comparable, the sum is also comparable.
The Proposal is not unfairly discriminatory. The FPGA Service will be available to all customers on a non-discriminatory basis, and therefore the proposed fees are not designed to permit unfair discrimination between customers, issuers, brokers, or dealers.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
Nothing in the Proposal burdens inter-market competition (the competition among self-regulatory organizations) because approval of the Proposal does not impose any burden on the ability of other exchanges to compete. As noted above, FPGA technology is generally available and any exchange has the ability to offer such technology if it chooses.
Nothing in the Proposal burdens intra-market competition (the competition among consumers of exchange data) because the FPGA Service will be available to any customer under the same fee schedule as any other customer, and any market participant that wishes to purchase the FPGA Service can do so on a non-discriminatory basis.
No written comments were either solicited or received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The proposed rule change would amend Rule 22 (Suspension of Rules) of the NSCC Rules.
In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The proposed rule change would amend Rule 22 (Suspension of Rules) of the NSCC Rules. The Clearing Agencies will each file with the Commission substantively similar proposals to amend their corresponding Waiver Rules. A substantially similar proposal to amend MBSD Rule 33 was already filed with the Commission and implemented by FICC.
Specifically, the proposed amendments to NSCC Rule 22 would (i) establish “reasonable and appropriate” as the new standard for when an extension, waiver or suspension may occur; (ii) require action under the rule to be in consideration of NSCC's obligations as a clearing agency; (iii) be more clear and concise about who may authorize action under the rule; and (iv) make technical, ministerial, and other conforming and clarifying changes.
NSCC Rule 22 authorizes NSCC, in general, to extend, waive, or suspend an NSCC Rule, Procedure or regulation issued by NSCC. Under the current rule, any extension, waiver, or suspension must be (A) necessary or expedient and (B) requires a written report of such extension, waiver, or suspension (other than an extension of time of less than eight hours), stating the pertinent facts, the identity of the person or persons who authorized such extension, waiver or suspension and the reason such extension, waiver or suspension was deemed necessary or expedient. The report must then be promptly made and filed with NSCC's corporate records and available for inspection during regular business hours on Business Days.
The proposed changes would harmonize the language, purpose, and governance of NSCC Rule 22 with the equivalent Waiver Rule of MBSD Rule 33,
NSCC proposes to eliminate the requirement that an extension, waiver, or suspension authorized under NSCC Rule 22 must be “necessary or expedient.” Instead, the proposed changes establish “reasonable and appropriate” as the applicable standard, which NSCC believes is a clearer and more relevant standard for the actions to be taken under the rule. Moreover, NSCC proposes to provide some general guidance as to when the rule may need to be invoked: to prevent, correct, mitigate or otherwise address an event or situation that, if left unaddressed, could result in a failure to satisfy a requirement of the NSCC Rules, the Procedures or regulations issued by NSCC. Similarly, the proposed rule change clarifies that such authority may not be used to circumvent NSCC's regulatory obligations provided under NSCC Rule 60 (Market Disruption and Force Majeure) in the event of a Market Disruption.
In determining whether to exercise the authority provided by the proposed changes to NSCC Rule 22, the proposed rule text would require NSCC to consider its obligation to facilitate the prompt and accurate clearance and settlement of securities transactions; to safeguard securities and funds which are in its custody or control; and, in general, to protect investors and the public interest. Examples of the types of actions that may be considered reasonable and appropriate include, but are not limited to, reversing fees assessed in connection with erroneous activity resulting from misunderstanding of established procedures; suspension or extension of margin calculations due to system disruptions; and temporary suspension of physical processing. Note, though, any extension, waiver or suspension under the proposed changes to NSCC Rule 22 could not be a permanent action, nor would the rule permit extension, waiver or suspension of any regulatory obligations of NSCC.
Currently, NSCC Rule 22 states that action under the rule can be authorized by NSCC's Board of Directors, the Chairman of the NSCC Board, the President, the General Counsel or any Managing Director. To be clearer and more concise about who can authorize action, particularly given changing Board and executive titles, NSCC proposes to modify the language to simply state that action can be authorized by the Board of Directors or by any Officer of the Corporation having a rank of Managing Director or higher.
The proposed rule change would also make technical, ministerial, and other conforming and clarifying changes, including updating the title of NSCC Rule 22 to “Extension, Waiver or Suspension of Rules” and correct missing and defined terms.
This proposed harmonization is important to help ensure that NSCC, DTC and both FICC divisions can reasonably, appropriately, and consistently manage situations that may apply across multiple divisions, Clearing Agencies, or common members.
Section 17A(b)(3)(F) of the Act requires that the rules of the clearing agency be designed,
As described above, the proposed rule change would (i) establish “reasonable and appropriate” as the new standard for when an extension, waiver or suspension may occur; (ii) require action under the rule to be in
The proposed rule change would help ensure that NSCC is able to respond reasonably, appropriately, and effectively to situations that may require an extension, waiver, or suspension of an NSCC Rule, Procedure or regulation issued by NSCC. The proposed changes also enable NSCC to respond to such situations in the same way that DTC, GSD, and MBSD can respond under their respective Waiver Rules and under the same governance structure. Specifically, replacing the current “necessary or expedient” standard with a clearer and more intuitive “reasonable and appropriate” standard would enhance transparency and consistency of actions taken under the rule. Clarifying who may authorize action under the rule helps ensure that the individuals with appropriate authority are clearly and efficiently identified, which strengthens governance and accountability. Finally, the proposed technical and confirming changes improve clarity and consistency within the rule.
Therefore, by improving the function and clarity of NSCC Rule 22, NSCC believes the proposed rule change would help to assure the safeguarding of securities and funds which are in the custody or control of NSCC or for which it is responsible, consistent with the requirements of the Act, in particular Section 17A(b)(3)(F) of the Act, cited above.
NSCC does not believe that the proposed rule change will have any impact or impose any burden on competition because, as described above, the proposed changes would not affect the rights and obligations of the NSCC membership. Rather, the proposed changes are limited to clarifying the standard and conditions under which NSCC may extend, waive, or suspend the NSCC Rules, Procedures or regulations issued by NSCC, while also making technical and ministerial edits. These proposed changes would not inhibit access to NSCC's services or disadvantage or favor any particular Member in relationship to another Member. As such, NSCC believes the proposed rule change would not have any impact on competition.
NSCC has not received or solicited any written comments relating to this proposal. If any written comments are received, NSCC will amend this filing to publicly file such comments as an Exhibit 2 to this filing, as required by Form 19b-4 and the General Instructions thereto.
Persons submitting written comments are cautioned that, according to Section IV (Solicitation of Comments) of the Exhibit 1A in the General Instructions to Form 19b-4, the Commission does not edit personal identifying information from comment submissions. Commenters should submit only information that they wish to make available publicly, including their name, email address, and any other identifying information.
All prospective commenters should follow the Commission's instructions on
NSCC reserves the right to not respond to any comments received.
Because the foregoing proposed rule change does not:
(i) significantly affect the protection of investors or the public interest;
(ii) impose any significant burden on competition; and
(iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
Cboe BYX Exchange, Inc. (the “Exchange” or “BYX”) proposes to introduce a Small Retail Broker Hosted Solutions Program and to update the existing eligibility requirements for the Small Retail Brokerage Distribution Program for the Cboe One Summary Feed and BYX Top Data Feed. The text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the Exchange's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to adopt a Small Retail Broker Hosted Solutions Program (the “Program”) for BYX Top Data and Cboe One Summary Data (collectively, the “Applicable Feed”).
Further, the Exchange proposes to increase the allowed maximum Non-Professional Data User subscriber count for the existing Small Retail Broker Program for Cboe One Summary Feed and BYX Top Data Feed. By way of background, the Exchange currently offers the BYX Top Data Feed, which is a data feed that offers top-of-book quotations and last sale information based on orders entered into the Exchange's System. The BYX Top Data Feed benefits investors by facilitating their prompt access to real-time top-of-book information contained in BYX Top Data. The Exchange's affiliated equities exchanges (
Currently, the Exchange offers a Small Retail Broker Distribution Program
The Exchange now proposes to create a new Program based on the proposed eligibility criteria for Small Retail Brokers to specifically support Small Retail Brokers who are operating platforms on behalf of other Small Retail
Of further note, the Hosting Small Retail Broker Distributor is responsible for reporting its External Hosted Subscribers and their users, and ultimately the Hosting Small Retail Broker Distributor is responsible for payment of all data fees for both its External Hosted Subscribers and itself. While the Exchange is not privy to pass-through costs between Hosting Small Retail Broker Distributors and External Hosted Subscribers, this proposed pricing allows Hosting Small Retail Broker Distributors the freedom to charge or not charge External Hosted Subscribers while also appropriately charging for a service provided to an External Hosted Subscriber that is benefitting from an infrastructure developed and supported by the Hosting Small Retail Broker Distributor. The Exchange notes that the current Small Retail Broker Program prevents the Hosting Small Retail Broker Distributor from packaging this waiver as part of their overall service to their External Hosted Subscribers (as External Hosted Subscribers would be billed directly under the existing Small Retail Broker Program).
Additionally, given that External Hosted Subscribers are smaller relative to other Small Retail Brokers currently participating in the Small Retail Broker Distribution Program, their ability to subscribe to the Applicable Feed as Hosting Small Retail Broker Distributors is likely not feasible. Specifically, the costs of the Applicable Feed may make access to this data impractical. Additionally, the costs associated with building and maintaining the technological infrastructure to receive and disseminate data, may make access to such data impractical. Generally speaking, technology, infrastructure, and connectivity costs are a significant monetary investment and require significant human expertise and resources to maintain. As such, the totality of costs can make access to data difficult. The Exchange believes, though, that the proposed fees and the ability to subscribe to the Applicable Feed as External Hosted Subscribers will make access to data more feasible. Indeed, the Exchange anticipates that the retail broker-dealers that would seek to become External Hosted Subscribers are broker-dealers that do not have the technological infrastructure in place to ingest and disseminate data as a Hosting Small Retail Broker, and that are likely to have smaller client bases and business models not as conducive to making the investments necessary to become a Hosting Small Retail Broker Distributor.
In these regards, the Exchange believes that the proposed program will incentivize Hosting Small Retail Broker Distributors to offer the Applicable Feed to External Hosted Subscribers, thereby making data accessible to a larger number of broker-dealers and their clients, at an affordable cost. Specifically, under the proposed program, a Hosting Small Retail Broker Distributor providing the data to at least one External Hosted Subscriber would be eligible for a credit of its Distribution Fee (a credit of $250/month for BYX Top Data Feed and a credit of $3,500/month for Cboe One Summary Feed) that it is normally responsible for under the existing Small Retail Broker Program. Additionally, the External Hosted Subscriber shall also receive a waiver of the Distribution Fee (a credit of $250/month for BYX Top Data Feed and a credit of $3,500/month for Cboe One Summary Feed). The External Hosted Subscriber will also receive a waiver of the Data Consolidation Fee for the Cboe One Summary Data (a credit of $350/month) and in lieu of paying the Non-Professional User fees, it shall bea set monthly fee of $100 for BYX Top and $850 for Cboe One Summary Data.
In addition to the changes set forth above, the Exchange also proposes to modify the existing Small Retail Broker Program for Cboe One Summary Feed and BYX Top Feed to increase the number of Non-Professional Data User maximum from 5,000 to 10,000 to be consistent with the proposed threshold for External Hosted Subscribers. As previously discussed, the Exchange proposes to also use the cap of 10,000 Non-Professional Data Users for the proposed Program. The Exchange proposes to increase this in support of
As mentioned above, the existing fee structure makes it costly for both Hosting Small Retail Broker Distributors and its External Hosted Subscribers to provide data to the External Hosted Subscribers' retail clients as Distribution Fees are assessed on both Small Retail Brokers. Overall, the Exchange believes that this fee proposal will help to make its data more widely accessible for retail users who receive their data from External Hosted Subscribers. Specifically, the Exchange believes that that this proposal will (i) further increase the competitiveness of the Exchange's top of book market data products compared to competitor offerings that may currently be cheaper for firms with a limited subscriber base that do not yet have the scale to take advantage of the lower subscriber fees offered by the Exchange; and will (ii) provide additional incentives for Hosting Small Retail Broker Distributors to provide hosted solution services for other Small Retail Brokers in order to make data more widely available to retail investors. In turn, the Exchange believes that this change may benefit market participants and investors by spurring additional competition and increasing the accessibility of the Exchange's top of book data.
The Exchange notes that at least one other exchange has a similar offering. For example, the New York Stock Exchange has a Redistribution Fee Waiver for NYSE Trades, for which redistributors of data may have their redistribution fee waived so long as they provide the data to at least one data feed recipient and reports such data feed recipient or recipients to the Exchange.
Without these discounts, a redistributor of NYSE Trades would pay the General Access Fee of $1,500/month in addition to the Redistribution Fee of $1,000/month and the applicable Professional User Fee ($4/month/User) and Non-Professional User Fee ($0.20/month/User).
While the eligibility requirements of the NYSE program and the proposed Program differ, both programs are intended to incentivize redistribution of applicable data feeds by providing enhanced discounts and both programs target different segments for a specific purpose. The proposed discounts under this Program are intended to make the Exchange's offering competitively priced relative to alternative options that participants may have.
Without the proposed pricing discounts, the Exchange believes that (i) prospective customers may not be interested in purchasing top of book data from the Exchange, and may instead purchase such data from other national securities exchanges or the Securities Information Processors (“SIPs”), potentially at a higher cost than would be available pursuant to the proposed program and (ii) that Hosting Small Retail Broker Distributors are not incentivized to make the Applicable Feed available via a hosted solution for retail investors of its External Hosted Subscribers. Similar to the existing Small Retail Broker Program, the Exchange believes that this proposed Program will continue to increase competition for such market data, and that enhanced competition could help to further reduce data fees as providers compete for subscribers, as well as help diversify the availability and quality of data offerings available to retail investors through their Hosting Small Retail Broker Distributors. Ultimately, the Exchange believes that it is critical that it be allowed to compete by offering attractive pricing to customers as increasing the availability of such products ensures continued competition with alternative offerings. Such competition may be constrained when competitors are impeded from offering alternative and cost-effective solutions to customers.
The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,
The Exchange also believes that the proposed rule change is consistent with Section 11(A) of the Act.
In adopting Regulation NMS, the Commission granted SROs and broker-dealers increased authority and flexibility to offer new and unique market data to the public. It was believed that this authority would expand the amount of data available to consumers, and also spur innovation and competition for the provision of market data. The Exchange believes that the proposed fee change would further broaden the availability of U.S. equity market data to investors, and in particular retail investors, consistent with the principles of Regulation NMS.
The Exchange operates in a highly competitive environment. Indeed, there are sixteen registered national securities exchanges that trade U.S. equities and offer associated top of book market data products to their customers. The national securities exchanges also compete with the SIPs for market data customers. The Commission has repeatedly expressed its preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. Specifically, in Regulation NMS, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system “has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.”
Making alternative data products available to market participants ultimately ensures increased competition in the marketplace and constrains the ability of exchanges to charge prohibitive fees. If a market participant views one exchange's top of book data fees as more or less attractive than the competition they can, and frequently do, switch between competing products. In fact, the competitiveness of the market for such top of book data products is one of the primary factors animating this proposed rule change, which is designed to allow the Exchange to further compete for this business. As mentioned above, at least one other Exchange provides a similar waiver for redistribution of market data.
The Exchange notes that the Applicable Feed are distributed and purchased on a voluntary basis, in that neither the Exchange nor market data distributors are required by any rule or regulation to make these data products available. Distributors (including vendors) and Users can therefore discontinue use at any time and for any reason, including due to an assessment of the reasonableness of fees charged. Further, the Exchange is not required to make any proprietary data products available or to offer any specific pricing alternatives to any customers.
The Commission has long stressed the need to ensure that the equities markets are structured in a way that meets the needs of ordinary investors. For example, the Commission's strategic plan for fiscal years 2018-2022 touts “focus on the long-term interests of our Main Street investors” as the Commission's number one strategic goal.
The Exchange proposes that the proposed waivers for the Applicable Feed only apply to Hosting Small Retail Broker Distributors and its External Hosted Subscribers for three reasons. First, the Hosting Small Retail Broker Distributor is creating a full-service offering for External Hosted Subscribers in contrast to the Small Retail Brokers under the current Program, which only provide services directly to its own retail clients. Maintaining an additional platform for External Hosted Subscribers' clients is an additional workstream for the Hosting Small Retail Broker Distributors (in contrast to the existing Small Retail Brokers that only provide data and services directly to their retail clients), requiring technological and capital investments, as they seek to support additional ecosystems of business, each with its own book of retail clients. In order to incentivize the Hosting Small Retail Broker Distributors to take on the additional duties associated with hosting External Hosted Subscribers (such as managing the data, entitlements, and display of the application provided to the External Hosted Subscriber), the Exchange believes it is not unfairly discriminatory to provide a waiver of the Distribution Fee for the Hosting Small Retail Broker Distributors, as opposed to the standard discounted Distribution Fee normally paid under the current Small Retail Broker Distribution Program.
Second, by creating this program, the Exchange is further able to reach additional retail investors. By waiving Distribution Fees for both the Hosting Small Retail Broker Distributor and its External Hosted Subscriber, both parties are incentivized to work together to provide data to retail investors. Third, as mentioned previously, the Hosting Small Retail Broker Distributor is responsible for the fees and reporting for both its own activity and that of its External Hosted Subscriber. While the Exchange is not privy to pass-through costs between Hosting Small Retail Broker Distributors and External Hosted Subscribers, this proposed pricing allows Hosting Small Retail Broker Distributors the freedom to charge or not charge External Hosted Subscribers while also appropriately charging for a service provided to an External Hosted Subscriber that is benefitting from an infrastructure developed and supported by the Hosting Small Retail Broker Distributor. The Exchange notes that the current Small Retail Broker Program prevents the Hosting Small Retail Broker Distributor from packaging this waiver as part of their overall service to their External Hosted Subscribers (as External Hosted Subscribers would be billed directly under the existing Small Retail Broker Program). Given that External Hosted Subscribers are smaller relative to other Small Retail Brokers currently participating in the Program, these costs associated with the Applicable Feed are inherently prohibitive to the External Hosted Subscriber. Through this Program, fees will not be a deterrent for Hosting Small Retail Brokers and External Hosted
Furthermore, while this Program would be effectively limited to smaller firms in accordance with the proposed eligibility requirements, the Exchange does not believe that this limitation makes the fees inequitable or unfairly discriminatory. The Exchange notes that large broker-dealers and/or vendors that distribute the Exchange's data products to a sizeable number of investors benefit from the current fee structure, which includes lower subscriber fees and Enterprise licenses. Due to lower subscriber fees, distributors that provide the Applicable Feed to more than the proposed capped amounts of Users permitted under either the Small Retail Broker Program or this Program already enjoy cost savings compared to competitor products. The Program, in addition to the existing Small Retail Broker Program, would therefore continue to ensure that small retail brokers that distribute top of book data to their retail investor customers could also benefit from reduced pricing, and would aid in increasing the competitiveness of the Exchange's data products for this key segment of the market.
Moreover, the Exchange does not believe that the proposed fees unfairly discriminate between Hosting Small Retail Broker Distributors and External Hosted Subscribers. While the proposal provides additional benefits to External Hosted Subscribers that would not otherwise accrue to them under the current program, the Exchange notes that such benefits are designed only to make access to market data more accessible to smaller retail broker-dealers that either do not possess the financial and technological resources necessary to receive data as a Small Retail Broker, or simply choose not commit such resourced based on their business models. In turn, to continue to incentivize the provision of the Applicable Feed by Hosting Small Retail Broker Distributors, the Exchange has sought to provide appropriate incentives to these brokers as well. Collectively, the fee structure provides benefits to both Hosting Small Retail Broker Distributors and External Hosted Subscribers.
While External Hosted Subscribers would receive benefits they would not accrue under the current program, these are not benefits that today's Small Retail Brokers would choose to avail themselves of under the new fee structure, because it is highly unlikely that today's Small Retail Brokers would choose to instead become External Hosted Subscribers. The Exchange notes that today's Small Retail Brokers that qualify under the current program, have already committed significant capital in terms of time, technology, and finances towards building out and maintaining the technological infrastructure and staffing needed to receive and distribute the Applicable Feed to their end users. To forego such financial and technological commitments simply to avail themselves of additional benefits afforded to External Hosted Subscribers under this proposal, would very likely require an existing Small Retail Broker to drastically change their current business model simply to avail themselves of the additional benefits provided to External Hosted Subscribers. Moreover, today's existing Small Retail Brokers are likely to be providing services to their subscribers other than the Additional Feeds, such as market access, order management systems, and other trading tools. To cease providing such a full suite of services—which required significant time and cost contributions—is unlikely and, again, would require a significant reversal in a Small Retail Broker's business model.
Rather, the Exchange believes that the more likely case is that the proposed fee structure will attract a new population of Small Retail Brokers who will seek to access the Applicable Feed as Hosted External Subscribers, at a cost-effective price point, thereby providing even more investors with access to top of book market data for U.S. equities. Another likely use case is that the proposed fee structure may incentivize more Small Retail Brokers to subscribe to the Applicable Feed as External Hosted Subscribers and, as they build their own business models and attract subscribers of their own, eventually commit time and resources to building their own infrastructure to evolve into a Hosting Small Retail Broker.
Furthermore, the Exchange acknowledges that under the proposed fee schedule that a Hosting Small Retail Broker Distributor is eligible for a waiver of its Distribution Fee once its first External Hosted Subscriber is subscribed, whereas under current program a Small Retail Broker is not eligible for such a waiver. However, the Exchange does not believe that this proposed fee structure unfairly discriminates between existing Small Retail Brokers and Hosting Small Retail Brokers, because the application of these fees is based on meaningful differences between existing Small Retail Brokers and potential Hosting Small Retail Broker Distributors.
Specifically, existing Small Retail Brokers are brokers that distribute the Applicable Feed to their own customers. These Small Retail Brokers typically operate their own retail trading businesses, and the provision of the Applicable Feed is part of the package of services provided to their own customers. Comparatively, similar to certain subscribers
Relatedly, the proposed fees are based on the competitive environment for market data products such as the Applicable Feed. In response to competition from other market data feeds such as NYSE BQT, the Exchange's proposed fees are merely intended to provide a financial incentive for vendors/redistributors that do not currently subscribe to any Exchange market data products to subscribe to the Applicable Feed. By focusing on this segment of the market, the Exchange believes that the proposed fees will make the Applicable Feed more competitive and attractive for vendors/redistributors to subscribe to,
Moreover, the Exchange believes that the proposed change to provide a waiver of the Distribution Fee to a Hosting Small Retail Broker Distributor (
Finally, the Exchange notes that nothing in the current proposal prevents an existing Small Retail Broker from choosing to instead subscribe to the Applicable Feed as an External Hosted Subscriber. However, the Exchange does not believe that this makes the proposal unfairly discriminatory between Hosting Small Retail Brokers and External Hosted Subscribers, as broker-dealers are free operate their businesses however they may choose in response to a host of a reasons, only one of which are associated costs.
The Exchange believes that the proposed cap of 10,000 for the Cboe One Summary Data Feed and BYX Top Data Feed for this Program, as well as increasing this cap to 10,000 for the Cboe One Summary Data Feed and BYX Top Data Feed for the Small Retail Broker Program is reasonable and not unfairly discriminatory as the Exchange believes it is in the best interest of all market participants to more broadly expand this in support of inclusion for more retail investors by participation in both programs by small retail brokers on a global scale.
The Exchange believes that the Distribution Fee Waivers for both the External Hosted Subscriber and the Hosting Small Retail Broker Distributor are reasonable as they represent a significant cost reduction for the Hosting Small Retail Broker Distributor to provide a hosted solution for the External Hosted Subscriber, to ultimately provide the data to the External Hosted Subscriber's retail investors. By targeting the Distribution Fee waiver to vendors/redistributors that provide external distribution of the Applicable Feeds, the Exchange believes that this would provide an incentive for redistributors to make the Applicable Feeds available to its customers. Specifically, if a data recipient is interested in subscribing to the Applicable Feeds and relies on a vendor/redistributor to obtain market data products from the Exchange, that data customer would need the vendor/redistributor to first subscribe to and distribute the Applicable Feeds. In this regard, the Exchange believes the proposed waiver would provide an incentive for vendors/redistributors to make the Applicable Feeds available to their customers, which will increase the availability of the Applicable Feeds to a larger potential population of retail investors.
While the existing fee structure does provide a benefit of a discounted waiver for Small Retail Brokers that externally distribute the data, these discounted Distribution Fees are still incurred by both the External Hosted Subscriber and the Hosting Small Retail Broker Distributor. In an attempt to alleviate these costs, and make this data more available to retail investors, the Exchange proposes to waive the Distribution Fees for both the Hosting Small Retail Broker Distributor and the External Hosted Subscriber. With this Program, the Exchange believes it will increase market accessibility and data to investors on a global scale. Exchange Hosted Subscribers may not have the infrastructure or technical capabilities to offer market data and/or execution services to its retail investors. Through waiving these fees for the External Hosted Subscriber, the Exchange hopes to reach a broader scale of retail investors globally. Further, as discussed above, the Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber and the Hosting Small Retail Broker Distributor given the development and maintenance the Hosting Small Retail Broker Distributor acquires to provide this data to the External Hosted Subscriber's end users.
The Exchange believes it is reasonable to not charge the External Hosted Subscriber the Data Consolidation Fee for Cboe One Summary Data for the duration of the time that they are eligible for this program. As previously discussed, the waiver of fees for the External Hosted Subscriber is intended to make this data more available to retail investors. The Exchange also believes it is appropriate and not unfairly discriminatory to limit this specific credit to the External Hosted Subscriber because, as described above, the Exchange believes by alleviating some of the barriers to entry, that Exchange Hosted Subscribers are able to bring this data and execution services to their retail investors. Of further note, the Exchange believes it is reasonable to maintain this cost for the Hosting Small Retail Broker Distributor as the Hosting Small Retail Broker Distributor is the party receiving this data from the Exchange where it is consolidated for the benefit of the Hosting Small Retail Broker Distributor.
The Exchange believes it is reasonable to set a fixed cost for Non-Professional Users fees for External Hosted Subscribers by charging a flat, fixed cost instead of charging per user to allow for additional savings. Under this structure, the External Hosted Subscriber shall still be responsible by paying the standard per User fee of a Professional Users under the Applicable Feed. The Exchange does not believe this is unfairly discriminatory as the program is based around making the Applicable Feed available for Non-Professional Users. The Exchange also notes that it has taken a similar approach here to the NYSE Per User Access Fee, which sets
The Exchange does not believe that the proposed rule change would result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange operates in a highly competitive environment, and its ability to price these data products is constrained by: (i) Competition among exchanges that offer similar data products to their customers; and (ii) the existence of inexpensive real-time consolidated data disseminated by the SIPs. Top of book data is disseminated by both the SIPs and the sixteen equities exchanges. There are therefore a number of alternative products available to market participants and investors. In this competitive environment potential subscribers are free to choose which competing product to purchase to satisfy their need for market information. Often, the choice comes down to price, as broker-dealers or vendors look to purchase the cheapest top of book data product, or quality, as market participants seek to purchase data that represents significant market liquidity. In order to better compete for this segment of the market, the Exchange is proposing to reduce the cost of top of book data provided by Hosting Small Retail Broker Distributors to its External Hosted Subscribers, and in turn, their retail investors. The Exchange believes that this would facilitate greater access to such data, ultimately benefiting the retail investors that are provided access to such market data.
The Exchange also believes the proposed fee changes will better enable it to compete in the Asia Pacific region, which is an area of increasing interest and growth within the U.S. equities markets, generally. As the Asia Pacific investor base seeks access to the liquidity and efficient price discovery processes that exist in the U.S. equities markets, various broker-dealers have begun offering trading in this region, and exchanges have begun to contemplate 24-hour trading solutions designed to capture the increased demand from the Asia Pacific investor base.
The Exchange does not believe that this price reduction would cause any unnecessary or inappropriate burden on intermarket competition as other exchanges and data vendors are free to lower their prices to better compete with the Exchange's offering. Indeed, as explained in the basis section of this proposed rule change, the Exchange's decision to (i) waive the Distribution Fee for the Hosting Small Retail Broker Distributor and the External Hosted Subscriber and (ii) waiving the Consolidation Fee (when applicable) for the External Hosted Subscriber and (iii) setting a fixed cost for the Non-Professional Users for the External Hosted Subscriber is itself a competitive response to different fee structures available on competing markets. The Exchange therefore believes that the proposed rule change is pro-competitive as it seeks to offer pricing incentives to customers to better position the Exchange as it competes to attract additional market data subscribers. The Exchange also believes that the proposed reduction in fees the Hosting Small Retail Broker Distributor and the External Hosted Subscriber would not cause any unnecessary or inappropriate burden on intramarket competition. Although the proposed fee discount would be largely limited to small retail broker subscribers, larger broker-dealers and vendors can already purchase top of book data from the Exchange at prices that represent a significant cost savings when compared to competitor products that combine higher subscriber fees with lower fees for distribution. In light of the benefits already provided to this group of subscribers, the Exchange believes that additional discounts to small retail brokers would increase rather than decrease competition among broker-dealers that participate on the Exchange. Furthermore, as discussed earlier in this proposed rule change, the Exchange believes that offering pricing benefits to brokers that represent retail investors facilitates the Commission's mission of protecting ordinary investors, and is therefore consistent with the Act.
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-CboeBYX-2025-029 and should be submitted on or before October 21, 2025.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to amend (1) Phlx's market data feed descriptions at Options 3, Section 23, Data Feeds and Trade Information; and (2) Phlx's market data pricing at Options 7, Section 9, B, Port Fees, and Section 10, Proprietary Data Feeds Fees, to set fees for two new feeds, the Trades Feed and the Spread Feed.
While these amendments are effective upon filing, the Exchange will implement this rule change on or before December 20, 2025. The Exchange will announce the operative date to members and member organizations in an Options Trader Alert.
The text of the proposed rule change is available on the Exchange's website at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
This proposal amends (1) Phlx's market data feed descriptions at Options 3, Section 23, Data Feeds and Trade Information; and (2) Phlx's market data pricing at Options 7, Section 9, B, Port Fees, and Section 10, Proprietary Data Feed Fees. Each change is described below.
The Exchange proposes to amend its market data feed descriptions in Options 3, Section 23, Data Feeds and Trade Information. Today, the Exchange offers 3 market data feeds: (1) Nasdaq Phlx Top of Market, (2) Nasdaq Phlx Order Feed, and (3) Nasdaq Phlx Depth of Market.
At this time, the Exchange proposes to harmonize its market data feeds at Options 3, Section 23(a) to Nasdaq ISE, LLC's (“ISE”) market data feeds at Options 3, Section 23(a) in connection with the technology migration. This harmonization will result in some enhancements to its current data feed offerings. Today, ISE offers the following market data feeds: (1) Nasdaq ISE Depth of Market Data Feed, (2) Nasdaq ISE Order Feed, (3) Nasdaq ISE Top of Market Feed, (4) Nasdaq ISE Trades Feed, and (5) Nasdaq ISE Spread Feed.
Currently, the Nasdaq Phlx Top of Market data feed at Options 3, Section 23(a)(1) provides,
The Exchange proposes to amend the description of the TOPO data feed to align the content of the feed to the Nasdaq ISE Top of Market Feed at Options 3, Section 23(a)(3). The Exchange proposes to provide in the first sentence, “. . . calculates and disseminates the Exchange's best bid and offer position, with aggregate size (including total size in aggregate, for Professional Order size in the aggregate and Public Customer Order size in the aggregate), based on displayable order and quote interest in the System.” This proposed rule text adds more specificity around aggregate size by noting that it includes total size in aggregate, for Professional Order size in the aggregate
The Exchange further proposes to modify the reference to last sale information in the definition of TOPO to align it with the content of the comparable top of book feeds contained in the ISE, MRX and GEMX rulebooks. This is part of the overall harmonization of the Phlx platform with those of other Nasdaq affiliated markets in Phlx's upcoming technology migration.
Conforming Phlx's data feeds to those of other Nasdaq affiliated markets will allow subscribers to reduce information processing costs by formatting their data processing systems on a common platform for Nasdaq markets. It will enable customers to ingest information from all Nasdaq exchanges without modifying their intake systems to ingest information using different exchange formats. This is a change from current practice, in which each exchange offers its own unique set of market data feeds, requiring subscribers to separately program their systems to ingest information from each distinct market. As such, the reference to last sale information
ISE, MRX and GEMX offer last sale information in a separate, standalone data feed, the Trades Feed.
With the proposed amendments, the description of the TOPO data feed at Options 3, Section 23(a)(1) would provide,
Currently, the Nasdaq Phlx Order Feed at Options 3, Section 23(a)(2) provides,
The Exchange proposes to amend the description of the Nasdaq Phlx Order Feed or “Order Feed,” as proposed, to align the content of the feed to the Nasdaq ISE Top of Market Feed at ISE Options 3, Section 23(a)(2). The Exchange proposes to add in the first sentence, “. . . provides pricing information on new orders resting on the Phlx Order Book (
The Exchange proposes to remove complex order details from the Order Feed. Complex order data will be included in a new Nasdaq Phlx Spread Feed as discussed below.
The Exchange also proposes to remove the sentence that provides, “The Nasdaq Phlx Order Feed provides real-time information to enable users to keep track of the single and complex order book(s)” because the Order Feed is for single-leg data only. With the proposed amendments, the description of the TOPO data feed at Options 3, Section 23(a)(2) would provide,
Currently, the Nasdaq Phlx Depth of Market data feed at Options 3, Section 23(a)(3) provides,
The Exchange proposes to amend the description of the Nasdaq Phlx Depth of Market data feed or “Depth of Market Feed,” as proposed, to align the content of the feed to the Nasdaq ISE Depth of Market Data Feed at ISE Options 3, Section 23(a)(1). The Exchange proposes to amend the first sentence to state, “. . . is a data feed that provides full order and quote depth information for individual quotes and orders on the order book and last sale information for trades executed on Phlx.” This amendment is non-substantive as it merely rewords the current sentence to align it to the first sentence of ISE Options 3, Section 23(a)(1). The Exchange proposes to remove the reference to auction information and the “Imbalance Message which includes the symbol, side of the market, size of matched contracts, size of the imbalance, and price of the affected series.” The Exchange would continue to offer “order imbalance information on opening/reopening (size of matched contracts and size of the imbalance),” however, as indicated in the final sentence of the description. The only substantive difference between the old and the new feeds in this context is that the Exchange will not provide exposure notifications with market participant capacity information on the new Depth of Market Feed.
Today, ISE offers the Nasdaq ISE Trades Feed (“Trades Feed”) at Options 3, Section 23(a)(4). This feed displays last trade information.
Today, ISE offers a Nasdaq ISE Spread Feed (“Spread Feed”) at Options 3, Section 23(a)(5). The ISE Spread Feed consists of: (1) options orders for all Complex Orders (
Similar to ISE, Phlx complex order data would be separately disseminated through the proposed Spread Feed.
Phlx proposes to amend its Pricing Schedule at Options 7, Section 10, Proprietary Data Fees, to adopt fees for the newly proposed Nasdaq Phlx Trades Feed and the Nasdaq Phlx Spread Feed.
The Exchange also proposes to amend its pricing schedule at Options 7,
Nasdaq proposes to offer the Trades Feed at no additional cost with the purchase of TOPO.
Nasdaq proposes to offer the Spread Feed at no additional cost with the purchase of the Order Feed.
The Exchange will implement this rule change on or before December 20, 2025.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The Proposal is an equitable allocation of fees because the proposed fees would apply to all market participants in a uniform manner.
The Proposal is not unfairly discriminatory. The proposed feeds are optional data fees available to all market participants on a non-discriminatory basis.
The Exchange believes that the proposed changes to the current data feed offerings in Phlx Options 3, Section 23(a) are consistent with the Act. Specifically, the Exchange believes that the proposed changes to TOPO, the Order Feed and the Depth of Market Feed will serve to align the information provided on Phlx to that provided in identical feeds at ISE (namely, Nasdaq ISE Depth of Market Data Feed, Nasdaq ISE Order Feed, and Nasdaq ISE Top of Market Feed at Options 3, Section 23(a)(1)-(3)), thereby ensuring a more consistent technology offering across the Nasdaq affiliated options exchanges.
The Exchange also believes that the modified TOPO feed will help to protect a free and open market by providing additional specificity concerning aggregate size. While the Exchange is removing the last sale information from the TOPO feed, the Exchange notes that it proposes to align it with the definitions of the comparable top of book feeds contained in the ISE, MRX and GEMX rulebooks.
Phlx proposes to harmonize its data feeds to those of other Nasdaq affiliated markets. Once the migration is completed, Phlx will have five market data feeds: (i) a depth of market feed, (ii) an order feed; (iii) a top of market feed; (iv) a trades feed; and (v) a spreads feed
The Exchange believes that the proposed changes to the Nasdaq Phlx Depth of Market data feed to no longer provide exposure notifications with market participant capacity information is consistent with the Act, as order imbalance information would continue to be offered in the Phlx Order Feed, and the information removed is immaterial to the Depth Feed. The proposal will serve to further align similar data feeds at ISE Options 3, Section 23(a)(1) and (2), thereby ensuring a more consistent technology offering across the Nasdaq affiliated options exchanges.
The Exchange's proposal to adopt a Phlx Trades Feed at Options 3, Section 23(a)(4) that is identical to the ISE Trades Feed at Options 3, Section 23(a)(4) is consistent with the Act because Phlx members and member organizations will have the opportunity to elect to subscribe to the same feed offered today on ISE.
The Exchange believes that its proposal furthers the objectives of Sections 6(b)(4) and 6(b)(5) of the Act,
The proposal offers three significant product enhancements. First, it will offer customers additional information on complex orders. Second, it is an essential element of Nasdaq's overall plan to standardize market data feeds across Nasdaq options exchanges, which will allow customers to ingest data more efficiently, and may result in customer cost saving. Third, the apportionment of market data across five feeds will allow customers to tailor their acquisition to only the data they need.
We expect our customers to take advantage of these additional options. Our experience with the ISE Exchange—which already offers a trades feed that is distinct from its top of book feed—shows that nearly a third of customers take either take the top of market feed only (approximately 17%) or the trades feed only (about 14%), while the remaining customers take both. We expect the same pattern to hold true for Phlx—about a third of customers will take one feed or the other, ingesting less data than would be required for a combined feed, and the remaining customers to take both feeds.
We expect that removing complex orders from the Order Feed and creating the new Spread Feed will enhance customer choice in a similar manner. The ISE Exchange offers an Order Feed that does not include complex orders, and a Spread Feed that does. Our experience with the ISE Exchange shows that approximately 45% of customers take either take the Spread Feed only (approximately 39%) or the Order Feed only (about 7%), while the remaining customers take both. We expect the same pattern to hold true for Phlx—somewhat less than half the customers will take one feed or the other, while the remaining customers will take both.
As discussed in detail below, the proposed feeds are identical to those of ISE, GEMX and MRX. Also, the proposed fees remain essentially unchanged from the current fee schedule. Although the current TOPO feed is proposed to be split into a new TOPO feed and a new Trades Feed, the Trades Feed will be offered in conjunction with TOPO for no additional cost, so there will be no change in fees for the customer. Similarly, the current Order Feed is proposed to be split into an Order Feed and a Spread Feed, but the new Spread Feed will be offered with the Order Feed at no additional cost, so there will be no change in fees.
Although there is an immaterial change to the Depth Feed regarding order exposure by capacity, the Exchange regards this to be an immaterial modification, and therefore fees for the Depth Feed remain essentially unchanged.
Further, for the reasons set forth below, fees for the Phlx remain comparable to those of the ISE, GEMX, and MRX exchanges relative to market share, as set forth below.
For the comparability analysis, the Exchange assessed market share
The Top of Market fees, which are not proposed to change from current levels, are comparable to, or less than, fees charged by Nasdaq ISE, Nasdaq GEMX and Nasdaq MRX based on relative market share.
As explained above, the Exchange proposes to remove the reference to last sale information from TOPO and offer last sale information in a separate, standalone data feed, the Trades Feed, to align Phlx's feeds with the structure used by the Nasdaq ISE, GEMX and MRX exchanges.
As noted above, changes are being proposed to the definition of the top of book feed for the ISE, GEMX and MRX exchanges to correct a technical error in the existing rule text.
For ISE, the inadvertent error appears to have occurred in the context of the September 9, 2024 technology migration by ISE to implement enhanced functionality.
A similar error occurred for GEMX in the context of the November 6, 2023 technology migration to implement enhanced functionality.
A similar error occurred for MRX in the context of the November 7, 2022 technology migration to implement enhanced functionality.
Although the contents of the top feeds changed in September 2024 for ISE, November 2023 for GEMX, and December 2022 for MRX, the Exchange is aware of no customer that changed its behavior as a result of this change. As such, customers did not perceive a significant shift in the relative value of the data, and the fees for ISE, GEMX, and MRX are comparable to the top of book information proposed by Phlx both before and after the data feed change.
The proposed fees for Phlx are comparable to, or less than, the fees charged by Nasdaq ISE, GEMX and MRX based on relative market share. The table below compares the proposed Phlx Top of Market Feed fees with those of ISE, GEMX and MRX.
The proposed (and current) Phlx fees for professional and non-professional users are also less than or comparable to ISE fees. Phlx charges a variable fee of $40 for professionals and $1 for non-professionals, while ISE charges a non-professional external distribution fee of $3,000 for non-professionals using a controlled device. Phlx's non-professional fees are below ISE fees for less than 3,000 users. ISE does not charge professional user fees.
Overall, the proposed Phlx fees are less than or comparable to the ISE fees, and reasonable given Phlx's market share of 9.2%, approximately 50 percent greater than ISE's market share of 6.3%.
Phlx also charges a variable fee of $40 for professionals and $1 for non-professionals; GEMX charges a non-professional external distribution fee of $1,000 for non-professionals using a controlled device that is not charged by Phlx. Phlx non-professional fees are lower than GEMX fees for fewer than 1,000 users. GEMX does not charge a professional user fee. Overall, the proposed Phlx fees are less than or comparable to GEMX fees, and reasonable given Phlx's market share of 9.2%, approximately four times greater than GEMX's market share of 2.4%.
Phlx also charges a variable fee of $40 for professionals and $1 for non-professionals; MRX charges a non-professional subscriber fee of $25.25 for professionals and $1 for non-professionals. MRX's Professional and Non-Professional charges cover the usage of all five MRX data products and are not assessed separately for each data product.
The proposed (and current) fees for the Phlx Order Feed are comparable to, or less than, fees charged by Nasdaq ISE,
As explained above, the Exchange proposes to remove complex order details from the Order Feed, but will offer such information free of charge on the Spread Feed with the purchase of an Order Feed subscription. Such information is not currently available on the Order Feeds of the Nasdaq ISE, Nasdaq GEMX and Nasdaq MRX exchanges, and therefore the proposed
The proposed fees for the Phlx Order Feed are comparable to, or less than, fees charged by Nasdaq ISE, Nasdaq GEMX and Nasdaq MRX exchanges based on relative market share. The table below compares the proposed Phlx Order Feed fees with those of ISE, GEMX and MRX.
The proposed (and current) fees for the Phlx Depth Feed are comparable to, or less than, fees charged by Nasdaq ISE,
Nasdaq proposes no additional fees for the Spread Feed, but rather will offer the Spread Feed at no cost with the purchase of the Order Feed. This will allow market participants to obtain both simple and complex order information for a single fee. Nasdaq will propose a separate fee for the purchase of the Order Feed at a later date.
Nasdaq proposes no additional fees for the Trades Feed, but rather will offer the Trades Feed at no cost with the purchase of TOPO. This will allow market participants to obtain both top of book information and trades information for a single fee. Nasdaq will propose a separate fee for the purchase of the Trades Feed at a later date.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act.
The Exchange's proposal to align its existing market data feeds (TOPO, Phlx Order Feed, and Phlx Depth of Market) to ISE's Market Data Feeds (ISE Depth of Market Data Feed, ISE Order Feed, and ISE Top of Market Feed) and adopt two other feeds (Phlx Trades Feed and Phlx Spread Feed) which are identical to ISE feeds (ISE Trades Feed, and ISE Spread Feed) does not impose an undue burden on intra-market competition, rather it provides Phlx member and member organization access to an equivalent amount of data currently available on ISE. All Phlx members and member organizations may subscribe to these feeds.
The Exchange's proposal to align its existing market data feeds (TOPO, Phlx Order Feed, and Phlx Depth of Market) to ISE's Market Data Feeds (ISE Depth of Market Data Feed, ISE Order Feed, and ISE Top of Market Feed) and adopt two other feeds (Phlx Trades Feed and Phlx Spread Feed) which are identical to ISE feeds (ISE Trades Feed, and ISE Spread Feed) does not impose an undue burden on inter-market as other options markets may elect to offer similar feeds.
Nothing in the proposal burdens inter-market competition (the competition among self-regulatory organizations) because approval of the Proposal does not impose any burden on the ability of other options exchanges to compete. As explained above, Nasdaq proposes no additional fees for the Trades or Spread feeds, but rather will offer both at no cost with the purchase of the TOPO or Order Feed, respectively. As such, the proposed fees for the Spread Feed and the Trades Feed are comparable to, and in some cases less than when compared to market share, those of other exchanges, as discussed above.
Nothing in the Proposal burdens intra-market competition (the competition among consumers of exchange data) because the Spread Feed and the Trades Feed are available to any market participant at the same price and any market participant that elects to purchase either the Spread Feed or the Trades Feed may do so on a non-discriminatory basis.
No written comments were either solicited or received.
Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
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.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Exchange Act” or “Act”),
The proposed changes were identified during OCC's annual review process and are designed to update the OCC Policies to better align the descriptions therein with OCC's current practices and make other non-substantive, clarifying, conforming, and administrative changes.
The proposed changes to the OCC Policies are contained in Exhibit 5A, Exhibit 5B and confidential Exhibit 5C to File No. SR-OCC-2025-015. Material proposed to be added is marked by underlining and material proposed to be deleted is marked with strikethrough text in the exhibits to File No. SR-OCC-2025-015. 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.
In its filing with the Commission, OCC included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. OCC has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of these statements.
OCC is the sole clearing agency registered with the Commission for standardized equity options listed on national securities exchanges. OCC also clears and settles certain stock loan transactions and transactions in futures and options on futures. In connection with its clearance and settlement of transactions in securities, OCC is a “covered clearing agency”
The RMF describes, in part, how OCC manages risk while providing efficient and effective clearing and settlement services. The RMF addresses OCC's ability to employ recovery tools and facilitate an orderly wind-down. Additionally, the RMF describes OCC's three lines of defense model, which assigns ownership and accountability and enhances communication for expectations around risk management at OCC. The TPRMF describes OCC's approach to the management of risks associated with third parties. Specifically, the TPRMF outlines a framework for OCC to identify, measure, monitor, and manage risks arising from third-party relationships including relationships with Clearing Members, clearing banks, custodians, liquidity providers, investment counterparties, financial market utilities, exchanges, and vendors. Lastly, the DMP summarizes the steps OCC may take in the event of a Clearing Member suspension, settlement bank failure, or the failure of a financial market utility with which OCC has a relationship to perform.
Consistent with regulatory obligations,
The purpose of this proposed rule change is to modify the OCC Policies to better reflect current practices at OCC and make other non-substantive, clarifying and administrative changes to the text of these policies.
OCC proposes to update the
The Legal and Regulatory Risk category under the
OCC proposes to revise the
OCC proposes to update the
Under the
Under the
OCC's proposed changes would update the
OCC proposes general revisions throughout the RMF, including formatting and grammatical changes, such as capitalizing defined terms, deleting unnecessary or redundant language and updating section numbering.
OCC's proposed changes to the TPRMF would update the definition of Third-Party as it relates to OCC's relationship with liquidity providers. Under the
OCC's proposed changes to the TPRMF would also remove an outdated refence to Article V of OCC's By-Laws, which is currently “reserved,” and replace it with reference to existing provisions throughout the OCC Rules. OCC recently reorganized such provisions in a prior rule filing.
OCC's proposed changes to the DMP update the
OCC's proposed changes also update footnote one in the
In the
OCC proposes amendments to the
In the
OCC proposes a clarifying change in the
OCC proposes additional revisions in the
OCC proposes additional minor and clarifying revisions to the
Under the
Within the
OCC also proposes amendments to the
OCC also proposes general revisions throughout the DMP, including formatting and grammatical changes, such as updating the section header of the document to align with current format, capitalizing the term “Clearing Member,” and deleting unnecessary or redundant language
OCC believes the proposed rule change is consistent with Section 17A of the Exchange Act
Rule 17ad-22(e)(1)
Rule 17ad-22(e)(2)
Lastly, Rule 17ad-22(e)(3) requires, in part, that OCC maintain a risk management framework that includes policies, procedures, and systems designed to identify, measure, monitor, and manage the range of risks that arise in or are borne by OCC, that are subject to review on a specified periodic basis and approved by the board of directors annually.
Section 17A(b)(3)(I) of the Act
Written comments were not and are not intended to be solicited with respect to the proposed change and none have been received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
The proposal shall not take effect until all regulatory actions required with respect to the proposal are completed.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Vanessa Countryman, Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or subject to copyright protection.
All submissions should refer to File Number SR-OCC-2025-015 and should be submitted on or before October 21, 2025.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On August 22, 2025, The Nasdaq Stock Market LLC (“Nasdaq” or “Exchange”) filed with the Securities and Exchange Commission (“SEC” or “Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On April 9, 2025, The Nasdaq Stock Market LLC (“Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
On June 12, 2025, pursuant to Section 19(b)(2) of the Act,
Section 19(b)(2) of the Act
The Commission finds that it is appropriate to designate a longer period within which to issue an order approving or disapproving the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange is filing with the Commission a proposed rule change to revise the Limited Liability Company Operating Agreement of 24X Bermuda Holdings LLC (the “24X Bermuda Holdco Agreement”) to provide a brief two-month extension of the temporary exemption from the ownership and voting limitations set forth in Section 9.2(g) of the 24X Bermuda Holdco LLC Agreement with respect to Dmitri Galinov and his Related Persons. 24X Bermuda Holdings LLC (“24X Bermuda Holdco”) wholly owns 24X US Holdings LLC (“24X US Holdco”), which, in turn, wholly owns the Exchange. The text of the proposed rule change is available on the Exchange's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange is filing with the Commission a proposed rule change to revise the Limited Liability Company Operating Agreement of 24X Bermuda Holdings LLC (the “24X Bermuda Holdco Agreement”) to provide a brief two-month extension of the temporary exemption from the ownership and voting limitations set forth in Section 9.2(g) of the 24X Bermuda Holdco LLC Agreement with respect to Dmitri Galinov and his Related Persons. 24X Bermuda Holdings LLC (“24X Bermuda Holdco”) wholly owns 24X US Holdings LLC (“24X US Holdco”), which, in turn, wholly owns the Exchange.
The 24X Bermuda Holdco LLC Agreement includes restrictions on the ability to own and vote units in 24X Bermuda Holdco (“Units”).
The relevant ownership limitation in the 24X Bermuda Holdco LLC Agreement provides that, for so long as 24X Bermuda Holdco shall control, directly or indirectly, 24X, no Person, either alone or together with its Related
In addition, with regard to the voting limitation, the 24X Bermuda Holdco LLC Agreement provides that no Person, alone or together with its Related Persons, may, directly, indirectly, or pursuant to any voting trust, agreement, plan or other arrangement, vote or cause the voting of Units or give any consent or proxy with respect to Units representing more than 20% of the voting power of the then issued and outstanding Units.
As set forth in the Section 9.2(g)(i) of the 24X Bermuda Holdco LLC Agreement, Dmitri Galinov and his Related Persons have a temporary exemption from the ownership limitation set forth in Section 9.2 of the 24X Bermuda Holdco LLC Agreement until nine months after the Commission grants 24X's application for registration as a national securities exchange or until 24X commences operation, if later than nine months.
Dmitri Galinov and his Related Persons also have a temporary exemption from the voting limitation set forth in Section 9.2 of the 24X Bermuda Holdco LLC Agreement until nine months after the Commission grants 24X's application for registration as a national securities exchange or until 24X commences operation, if later than nine months, but only with respect to any vote regarding any merger, consolidation or dissolution of the 24X Bermuda or any sale of all or substantially all of the assets of the 24X Bermuda.
When the Commission approved the limited temporary exemption in Section 9.2(g) of the 24X Bermuda Holdco LLC Agreement from the ownership limitation and voting imitations set forth in Section 9.2 of the 24X Bermuda Holdco LLC Agreement for Dmitri Galinov and his Related Persons as consistent with the Exchange Act, the Commission determined that the limited, defined period time in which the exemption would be in place would prevent Dmitri Galinov and his Related Persons from exercising undue control over 24X and minimize the possibility that 24X's ability to carry out its self-regulatory responsibilities under the Exchange Act could be impaired.
Exhibit K of 24X's Form 1 describes Dmitri Galinov and his Related Person's 43.07% ownership of 24X Bermuda Holdco. Absent the exemption, such ownership would exceed the 40% ownership limitation set forth in the 24X Bermuda Holdco LLC Agreement. Specifically, Exhibit K of 24X's Form 1 describes their ownership as follows:
Dmitri Galinov owns 7,000,000 Common Units and 179,215 Seed-3 Preferred Units, for a total of 7,179,215 Units for all classes outstanding. Dmitri Galinov is a Related Person of KNG CAPITAL LLC, Tanya Nazarov-Kenneally, and Vladimir Nazarov. KNG CAPITAL LLC owns 320,616 Seed-1 Preferred Units, which represents 1.84% of all classes of outstanding Units. Tanya Nazarov-Kenneally owns 1794 Seed-3 Preferred Units, which represents 0.01% of all classes of outstanding Units. Vladimir Nazarov owns 7176 Seed-3 Preferred Units, which represents 0.04% of all classes of outstanding Units. Accordingly, on an aggregate basis, Dmitri Galinov, together with his Related Persons, owns 43.07% of the Units of all classes of outstanding Units.
The Commission granted 24X's application for registration as a national securities exchange on November 27, 2024; therefore, nine months after such date is August 27, 2025. 24X plans to commence operation on September 29, 2025, which is the later of the two dates. Therefore, the temporary exemption is expected to expire on September 29, 2025.
The Exchange proposes to revise the 24X Bermuda Holdco LLC Agreement to provide a brief two-month extension of the temporary exemption from the
The proposed two-month extension of the temporary exemption would provide a reasonable and limited accommodation to a new entrant in the exchange market, allowing the Exchange to commence operation as scheduled on September 29, 2025 while it addresses the regulatory requirements related to the pending dilution transaction. The brief extension also would allow 24X Bermuda Holdco to avoid the potentially significant expense of redeeming all of the Units the holding of which by Dmitri Galinov and/or his Related Persons results in a violation of Section 9.2 for a price per Unit, as applicable, equal to the lesser of (a) book value or (b) Fair Market Value of such Units. Incurring such an expense, particularly for the indirect parent of a new Exchange seeking to commence operations, is unnecessary in light of the pendency of a transaction to dilute the ownership percentages of Dmitri Galinov and his Related Persons. Moreover, the proposed dilution transaction is intended to provide additional funds for 24X US Holdco, which may be used with regard to the operation and regulation of the Exchange.
Furthermore, the reasons that the Commission cited for approving the temporary exemption in Section 9.2(g) of the 24X Bermuda Holdco LLC Agreement as consistent with the Exchange Act also support the approval of the brief, two-month extension of the exemption. First, the limited, defined short period of time in which the extension would be in place would serve to prevent Dmitri Galinov and his Related Persons from exercising undue control over 24X and minimize the possibility that 24X's ability to carry out its self-regulatory responsibilities under the Exchange Act could be impaired. Second, because the exemption from the voting limitation would continue to apply only with respect to the limited situations involving any merger, consolidation or dissolution of 24X Bermuda Holdco or any sale of all or substantially all of the assets of the 24X Bermuda Holdco, it would not permit undue control over 24X or impair the regulatory responsibilities of 24X. Third, the extension of the temporary exemption is designed to afford Dmitri Galinov and his Related Persons the ability to protect the investment they have already made in the establishment of 24X that is over the current ownership limitation, which is only by 3.07% of the Units of all outstanding Units. Fourth, as the Commission previously noted, the Commission has approved other temporary exemptions from the ownership or voting limitations included in the governance documents of owners of a national securities exchange.
The Exchange believes that its proposed rule change is consistent with Section 6(b) of the Exchange Act
The brief two-month extension of the temporary exemption would provide a reasonable and limited accommodation to a new entrant in the exchange market, allowing the Exchange to commence operation as scheduled on September 29, 2025. The two-month extension would allow the Exchange to address the regulatory requirements related to the pending transaction without incurring the potentially significant expense of redeeming all of the Units in excess of the ownership limitations of Dmitri Galinov and/or his Related Persons.
Furthermore, the brief, two-month extension of the exemption would not undermine the goals of the ownership and voting limitations. Such a brief extension would serve to prevent Dmitri Galinov and his Related Persons from exercising undue control over 24X and minimize the possibility that 24X's ability to carry out its self-regulatory responsibilities under the Exchange Act could be impaired. Second, because the exemption from the voting limitation would continue to apply only with respect to the limited situations involving any merger, consolidation or dissolution of 24X Bermuda Holdco or any sale of all or substantially all of the assets of the 24X Bermuda Holdco, it would not permit undue control over 24X or impair the regulatory responsibilities of 24X. Third, the extension of the temporary exemption is designed to afford Dmitri Galinov and his Related Persons the ability to protect the investment they have already made in the establishment of 24X that is over the current ownership limitation, which is only by 3.07% of the Units of all outstanding Units. Fourth, the temporary exemption is consistent with other temporary exemptions from the ownership or voting limitations approved by the Commission with regard to other national securities exchanges.
Finally, the extension of the temporary exemption would provide additional time to facilitate additional investment and funding in 24X US Holdco. Such investment could be used by 24X US Holdco and its subsidiary, the Exchange, for general corporate expenses, including to support the operations and regulation of the Exchange. Such additional funding would enable the Exchange to be organized as to have the capacity to carry out the purposes of the Act and to comply with the provisions of the Act, the rules and regulations thereunder, and the rules of the Exchange, and, in turn, would protect investors and the public interest.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Exchange Act. The Exchange believes that the proposed brief, two-month extension of the temporary exemption from the ownership and voting limitations would enhance competition. By providing 24X, a new entrant to the exchange market, with limited additional time to address the regulatory requirements regarding the dilution of the indirect ownership interest of Dmitri Galinov and his Related Persons in the Exchange, the Exchange may commence operation as planned, thereby bringing a new exchange to market without delay. In doing so, however, the extension is short enough to limit adverse competitive consequences related to the exemption from the intended regulatory goals of the ownership and voting limitations. Furthermore, the proposed rule change would enhance competition by allowing additional time for the Exchange to seek to increase the diversity of indirect ownership of the Exchange.
The Exchange neither solicited nor received comments on the proposed rule change.
The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
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 will institute proceedings to determine whether the proposed rule change should be approved or disapproved.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
Cboe BYX Exchange, Inc. (“BYX” or the “Exchange”) proposes to update Rule 11.26(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the planned operation of the 24X National Exchange LLC (“24X Exchange”) as a registered national securities exchange
The text of the proposed rule change is also available on the Commission's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to update Rule 11.26(a) regarding the public disclosure of the sources of data that the Exchange utilizes when performing: (i) order handling; (ii) order routing; (iii) order execution; and (iv) related compliance processes to reflect the operation of the 24X Exchange as a registered national securities exchange.
On November 27, 2024, the Commission approved 24X Exchange's application to register as a national securities exchange.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,
The Exchange believes that its proposal to update Exchange Rule 11.26(a) to include 24X Exchange will ensure that the Rule publicly states on a market-by-market basis all of the specific network processor and proprietary data feeds that the Exchange utilizes for the handling, routing, and execution of orders, and for performing the regulatory compliance checks related to each of those functions. The proposed rule change also removes impediments to and perfects the mechanism of a free and open market and protects investors and the public interest because it provides additional specificity, clarity and transparency.
The Exchange believes its proposed rule change would not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, the Exchange believes the proposal would enhance competition because including all of the exchanges enhances transparency and enables investors to better assess the quality of the Exchange's execution and routing services.
The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from Members or other interested parties.
Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act
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 will institute proceedings to determine whether the proposed rule change should be approved or disapproved.
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:
• Use the Commission's internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On August 26, 2025, Cboe BZX Exchange, Inc. (“BZX”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Small Business Administration.
Notification of changes to Development Company Program; request for comments.
The U.S. Small Business Administration (SBA) is changing the job creation or retention requirements under its Development Company Loan Program (504 Loan Program) by increasing the dollar amounts used in calculating the number of jobs that must be created or retained for each 504 Project and for the portfolio average of each Certified Development Company.
SBA must receive comments by December 1, 2025.
You may submit comments, identified by Docket No. SBA-2025-0135, by any of the following methods:
(1)
(2)
SBA will post all comments on
Greg Suryadi, Finance and Loan Specialist, U.S. Small Business Administration, Office of Financial Assistance, telephone: (202) 205-6806 or email:
The 504 Loan Program is an SBA financing program authorized under Title V of the Small Business Investment Act of 1958 (SBI Act), 15 U.S.C. 695
• A loan obtained from a private sector lender with a senior lien covering at least 50 percent of the project cost;
• A loan obtained from a CDC (a 504 Loan) with a junior lien covering up to 40 percent of the total cost (backed by a 100 percent SBA-guaranteed debenture); and
• A contribution from the Borrower of at least ten percent equity.
To qualify for financing under the 504 Loan Program, each 504 Project must satisfy one of the economic development objectives or public policy goals set forth in sections 501(d)(1) through (3) of the SBI Act. Under section 501(d)(1), a Project is eligible for 504 financing if it creates job opportunities within two years of completion of the Project or if it preserves or retains jobs attributable to the Project. Section 501(e)(1) of the SBI Act required each 504 Project to create or preserve one job for every $65,000 guaranteed by SBA; in the case of a small manufacturing Project, the amount was $100,000. Under section 501(e)(2) of the SBI Act, if the Project was eligible for financing under one of the objectives or goals set forth in section 501(d)(2) or (3), the Project did not need to satisfy the job creation or preservation criteria described section 501(e) provided that the CDC's overall portfolio of outstanding debentures met or exceeded the job creation or preservation criteria of one job for every $65,000 guaranteed by SBA. In addition, under section 501(e)(3) of the SBI Act, for projects in Alaska, Hawaii, state-designated enterprise zones, empowerment zones and enterprise communities, labor surplus areas (as determined by the Secretary of Labor), and for other areas designated by SBA, the CDC's portfolio did not have to average more than $75,000 per job created or retained. See (Per the SBI Act loans for projects of small manufacturers are excluded from the overall portfolio calculations.)
The SBI Act authorizes SBA to develop the job creation or job preservation criteria that apply to the 504 Loan Program. See section 501(d) of SBI Act. SBA's regulations provide that “[a] Project must create or retain one Job Opportunity per an amount of 504 loan funding that will be specified by SBA from time to time in a
In 2018 SBA changed the job creation or retention requirements under the 504 Loan Program by increasing the dollar amounts used in calculating the number of jobs that must be created or retained for each 504 Project and for the portfolio average of each Certified Development Company, and designated Opportunity Zones as additional areas for which the higher portfolio average described in section 501(e)(3) of the SBI Act. See 83 FR 55224 (November 2, 2018). As a consequence of these changes, to satisfy the economic development objectives or public policy goals set forth in sections 501(d)(1) through (3) of the SBI Act, each 504 Project had to create or preserve one job for every $75,000 guaranteed by SBA; in the case of a small manufacturing Project, the amount was $120,000. Further, if the Project was eligible for financing under one of the objectives or goals set forth in section 501(d)(2) or (3), the Project did not need to satisfy the job creation or preservation criteria described in section 501(e)(1) provided that the CDC's overall portfolio of outstanding debentures met or exceeded the job creation or preservation criteria of one job for every $75,000 guaranteed by SBA. Finally, for projects in Alaska, Hawaii, State-designated enterprise zones, empowerment zones and enterprise communities, labor surplus areas (as determined by the Secretary of Labor), and for other areas designated by
In 2023 SBA again changed the job creation or retention requirements under the 504 Loan Program by increasing the dollar amounts used in calculating the number of jobs that must be created or retained for each 504 Project and for the portfolio average of each CDC. See 88 FR 30379 (May 11, 2023). Consequently, under current requirements, to satisfy the economic development objectives or public policy goals set forth in sections 501(d)(1) through (3) of the SBI Act, each 504 Project must create or preserve one job for every $90,000 guaranteed by SBA; in the case of a small manufacturing Project, the amount is $140,000.
Further, under current requirements, if the Project is eligible for financing under one of the objectives or goals set forth in section 501(d)(2) or (3), the Project need not satisfy the job creation or preservation criteria described in section 501(e)(1) provided that the CDC's overall portfolio of outstanding debentures meets or exceeds the job creation or preservation criteria of one job for every $90,000 guaranteed by SBA. Finally, under current requirements, for projects in Alaska, Hawaii, state-designated enterprise zones, empowerment zones and enterprise communities, labor surplus areas (as determined by the Secretary of Labor), and for other areas designated by SBA, which include Opportunity Zones (as described by section 13823 of the Tax Cuts and Jobs Act of 2017, Public Law 115-97), the CDC's portfolio may average not more than $100,000 per job created or retained.
Although SBA recently increased the job creation or retention standards for the 504 Loan Program, the Consumer Price Index for All Urban Consumers has increased 5.4 percent from May 2023 through August 2025 according to the Bureau of Labor Statistics of the U.S. Department of Labor. In addition, economic uncertainty and an increase in the costs of goods due to international trade relations and supply chain disruptions have increased construction costs, inventory costs and impacted the cost of job creation and retention. In 2024, 77 percent of small businesses reported rising costs for goods, services and wages according to the Federal Reserve's Small Business Credit Survey. Rising energy and fuel costs due to factors like geopolitical events and increased demand contributed to increased costs of goods and impacted shipping expenses. Supply chain disruptions, stemming from various factors including geopolitical tensions and extreme weather events, continue to challenge small businesses. Materials scarcity, shipping delays and higher transportation costs contribute to increased operation expenses. Rising wages, driven by factors like labor shortages, increase the jobs of job creation and job retention. Commercial insurance rates have generally increased in recent years, increasing the cost to provide employee benefit packages. This combination of increasing operating costs, ongoing supply chain disruptions, a tight labor market requiring competitive wages and benefits, rising insurance costs and the cost to train employees on AI technology advances have impacted the dollar per job costs for business for employee retention, job creation and work force development training.
Furthermore, due to the Administration's focus on HUB Zones, labor surplus areas and other specialty zones, the Administrator is resetting the adjusted dollar per job for that category to align with the manufacturing and energy public policy goal dollar per job.
Accordingly, pursuant to 13 CFR 120.829(a) and 120.861, SBA is modifying the job opportunity requirements as follows:
(1) A Project must create or retain one job opportunity per $95,000 guaranteed by SBA except that, in the case of a Project of a small manufacturer or a project that meets an energy public policy goal, the Project must create or retain one job opportunity per $150,000 guaranteed by SBA.
(2) For Projects that are eligible under 13 CFR 120.862, “Other economic development objectives,” a CDC's portfolio must reflect an average of one job opportunity for every $150,000 guaranteed by SBA; and (3) For Projects in Alaska, Hawaii, state-designated enterprise zones, empowerment zones and enterprise communities, labor surplus areas (as determined by the Secretary of Labor), and for other areas designated by SBA (which include Opportunity Zones), the CDC's portfolio may average not more than $150,000 per job created or retained.
SBA invites public comments on these new job creation or preservation standards and the designation of additional areas for application of the higher portfolio average described above. Please clearly identify paper and electronic comments as “Public Comments on 504 Loan Program's Job Opportunity Requirements, Docket No. SBA-2025-0135” and submit them by one of the methods identified in the
SBA will consider the comments and determine whether any revisions are necessary.
This notice announces the renewal of the charter for the President's Emergency Plan for AIDS Relief (PEPFAR) Scientific Advisory Board. The PEPFAR SAB is established under the general authority of the Secretary of State and the Department of State set forth in 22 U.S.C. 2656, and consistent with the Federal Advisory Committee Act, as amended (5 U.S.C. 1001 et seq).
For further information about the Board, please contact Dr. Emily Innis, Designated Federal Officer for the Board, Bureau of global health Security and Diplomacy, U.S. Department of State (telephone: 202-372-7867; email:
Notice is hereby given of the following determinations: I hereby determine that certain objects being imported from abroad pursuant to agreements with their foreign owners or custodians for temporary display in the exhibition entitled “Korean Treasures:
Reed Liriano, Program Coordinator, Office of the Legal Adviser, U.S. Department of State (telephone: 202-632-6471; email:
The foregoing determinations were made pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), Executive Order 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681,
Surface Transportation Board.
Notice tentatively approving and authorizing finance transaction.
TBL Group, Inc. (TBL Group), a noncarrier holding company that controls multiple interstate motor passenger carriers, has filed an application to acquire the assets of Kaptyn Nevada, LLC (Kaptyn), a federally regulated motor passenger carrier. The Board is tentatively approving and authorizing the transaction. If no opposing comments are timely filed, this notice will be the final Board action.
Comments must be filed by November 14, 2025. If any comments are filed, TBL Group may file a reply by December 1, 2025. If no opposing comments are filed by November 14, 2025, this notice shall be effective on November 15, 2025.
Comments, referring to Docket No. MCF 21139, may be filed with the Board either via e-filing on the Board's website or in writing addressed to: Surface Transportation Board, 395 E Street SW, Washington, DC 20423-0001. In addition, send one copy of comments to TBL Group's representative: Andrew K. Light, Scopelitis, Garvin, Light, Hanson & Feary, P.C., 10 W Market Street, Suite 1400, Indianapolis, IN 46204.
John Rackson at (202) 929-2676. If you require an accommodation under the Americans with Disabilities Act, please call (202) 245-0245.
On September 8, 2025, TBL Group filed an application under 49 U.S.C. 14303 and 49 CFR part 1182, for Board authority for TBL Group to acquire indirect control of Kaptyn's primary business assets through TBL Group's subsidiary, Echo Nevada, LLC (Echo Nevada). (Appl. 1, 8.)
The application states that TBL Group is a Texas corporation, headquartered at 15734 Aldine Westfield Road, Houston, TX 77032. (
The application also notes that TBL Group has filed an application, in Docket No. MCF 21138, to acquire control of BTM Coaches, Inc. (Coaches). (
According to TBL Group, in the proposed transaction, TBL Group's noncarrier subsidiary Echo Nevada will acquire substantially all of Kaptyn's business assets and become an interstate motor carrier. (Appl. at 8.) The application explains that Echo Nevada is a new Nevada limited liability company that TBL Group is organizing in order to acquire Kaptyn's assets and operate essentially the same business. (
The application describes Kaptyn as a Nevada limited liability company headquartered in Las Vegas, Nev., doing business under the names Presidential Transportation and Presidential Limousine. (
Under 49 U.S.C. 14303(b), the Board must approve and authorize a transaction that it finds consistent with the public interest, taking into consideration at least (1) the effect of the proposed transaction on the adequacy of transportation to the public, (2) the total fixed charges resulting from the proposed transaction, and (3) the interest of affected carrier employees. TBL Group has submitted the information required by 49 CFR 1182.2, including information demonstrating that the proposed transaction is consistent with the public interest under 49 U.S.C. 14303(b),
TBL Group does not expect the proposed transaction to have any detrimental impact on the adequacy of transportation services available for the public in Kaptyn's service area. (Appl. 10.) TBL Group anticipates that services available to the public will increase as additional capacity is made available and operating efficiencies are realized. (
TBL Group concedes that the proposed transaction will increase fixed charges in the form of interest expense, explaining that funds will be borrowed to finance the transaction. (
TBL Group states that there is strong demand for passenger surface transportation in Kaptyn's service area, with many service options available to passengers. (
Based on TBL Group's representations, the Board finds that the transaction proposed in the application is consistent with the public interest. The application will be tentatively approved and authorized. If any opposing comments are timely filed, these findings will be deemed vacated, and, unless a final decision can be made on the record as developed, a procedural schedule will be adopted to reconsider the application.
This action is categorically excluded from environmental review under 49 CFR 1105.6(c).
Board decisions and notices are available at
1. The proposed transaction is approved and authorized, subject to the filing of opposing comments.
2. If opposing comments are timely filed, the findings made in this notice will be deemed vacated.
3. This notice will be effective on November 15, 2025, unless opposing comments are filed by November 14, 2025. If any comments are filed, TBL Group may file a reply by December 1, 2025.
4. A copy of this notice will be served on: (1) the U.S. Department of Transportation, Federal Motor Carrier Safety Administration, 1200 New Jersey Avenue SE, Washington, DC 20590; (2) the U.S. Department of Justice, Antitrust Division, 10th Street & Pennsylvania Avenue NW, Washington, DC 20530; and (3) the U.S. Department of Transportation, Office of the General Counsel, 1200 New Jersey Avenue SE, Washington, DC 20590.
By the Board, Board Members Fuchs, Hedlund, and Schultz.
Surface Transportation Board.
Notice of Rail Energy Transportation Advisory Committee meeting.
Notice is hereby given of a meeting of the Rail Energy Transportation Advisory Committee (RETAC), pursuant to the Federal Advisory Committee Act.
The meeting will be held on Thursday, October 30, 2025, at 9:00 a.m. E.T.
The meeting will be held at the Surface Transportation Board headquarters at 395 E Street SW, Washington, DC 20423.
Elizabeth McGrath at (202) 748-4566 or
RETAC was formed in 2007 to provide advice and guidance to the Surface Transportation Board (Board), and to serve as a forum for discussion of emerging issues related to the transportation of energy resources by rail.
The meeting, which is open to the public, will be conducted in accordance with the Federal Advisory Committee Act, 5 U.S.C. Chapter 10; Federal Advisory Committee Management regulations, 41 CFR part 102-3; RETAC's charter; and Board procedures. Further communications about this meeting may be announced through the Board's website at
By the Board, Anika S. Cooper, Chief Counsel, Office of Chief Counsel.
CWW, LLC d/b/a Columbia-Walla Walla Railway (CWW), a Class III railroad, has filed a verified notice of exemption pursuant to 49 CFR 1150.41 to lease from the Port of Walla Walla (the Port) and operate approximately 900 feet of track, from the clearance point of a main line switch located at milepost 211.81 of Union Pacific Railroad Company's Ayer Subdivision to a point roughly 900 feet north and east, in Walla Walla County, Wash. (the Line). CWW indicates that the Line does not have mileposts.
According to the verified notice, CWW and the Port have entered into an agreement under which CWW will lease and operate the Line as a common carrier. CWW certifies that the agreement contains no clause or provision that may limit or prohibit interchange with any third-party connecting carrier. According to the verified notice, the agreement will take effect as of the effective date of this notice.
CWW certifies that its annual operating revenue does not and will not as a result of the subject transaction exceed the threshold of a Class I or Class II rail carrier.
The transaction may be consummated on or after October 23, 2025, the effective date of the exemption (30 days after the verified notice was filed).
If the verified notice contains false or misleading information, the exemption is void ab initio. Petitions to revoke the exemption under 49 U.S.C. 10502(d) may be filed at any time. The filing of a petition to revoke will not automatically stay the effectiveness of the exemption. Petitions for stay must be filed no later than October 16, 2025 (at least seven days before the exemption becomes effective).
All pleadings, referring to Docket No. FD 36884, must be filed with the Surface Transportation Board either via e-filing on the Board's website or in writing addressed to 395 E Street SW, Washington, DC 20423-0001. In addition, a copy of each pleading must be served on CWW's representative, Stephen J. Foland, Fletcher & Sippel LLC, 29 North Wacker Drive, Suite 800, Chicago, IL 60606.
According to CWW, this action is categorically excluded from environmental review under 49 CFR 1105.6(c) and from historic reporting requirements under 49 CFR 1105.8(b).
Board decisions and notices are available at
By the Board, Anika S. Cooper, Chief Counsel, Office of Chief Counsel.
Federal Aviation Administration (FAA), DOT.
Notice and request for comments.
In accordance with the Paperwork Reduction Act of 1995, FAA invites public comments about our intention to request the Office of Management and Budget (OMB) approval to renew an information collection. The collection involves information from applicants requesting or holding an FAA mechanic, repairman, or parachute rigger certificate, or a mechanic inspection authorization (IA). The information to be collected will be used to determine applicant eligibility for certification or authorization.
Written comments should be submitted by December 1, 2025.
Please send written comments:
Tanya Glines by email at:
IA refresher course training providers develop training and request FAA acceptance of training courses using FAA Form 8610-6. These courses provide IA holders with refresher training to be eligible for IA renewal. Light-sport repairman training course providers develop training and request FAA acceptance of the training course. These courses provide light-sport repairman applicants with training to be eligible for a light-sport repairman certificate with an inspection or maintenance rating. IA and light-sport repairmen training courses require FAA acceptance to ensure that certificate holder and applicant training provides the appropriate knowledge and skill to exercises the privileges of the certificate, rating, and authorization, to ensure aircraft are airworthy for operation.
Parachute riggers must maintain records of the packing, maintenance, and alteration of parachutes performed or supervised by the parachute rigger. These records are used to ensure that parachutes are properly maintained and are safe for use.
Federal Aviation Administration (FAA), U.S. Department of Transportation (DOT).
Notice; Solicitation of Nominations for Membership.
The Department solicits nominations for membership to serve on the Research, Engineering, and Development Advisory Committee (REDAC), which is intended to provide advice and recommendations to the FAA Administrator for the sustaining of the Agency's Research and Development (R&D) Portfolio.
The deadline for nominations for Committee members must be received on or before October 30, 2025.
All nomination materials should refer to the docket number above and be submitted by one of the following methods:
•
•
•
Chinita Roundtree-Coleman, REDAC Program Manager/Lead, Federal Aviation Administration, U.S. Department of Transportation;
REDAC was established by the Secretary of Transportation pursuant to Public Law (Pub. L.) 100-591 (1988), Public Law 101-508 (1990), and 49 U.S.C. 44508, and it is operated in accordance with the Federal Advisory Committee Act, 5 U.S.C. ch. 10. The purpose of REDAC is to provide advice to the FAA Administrator regarding the needs, objectives, plans, approaches, content, and accomplishments with respect to aviation research.
In particular, REDAC will consider aviation research, future technology, and the National Airspace System—present and future. The Committee will also assist in ensuring that such research is coordinated with similar research being conducted outside of FAA. In addition, the Committee will review and comment on the aviation research grants program and on the research and training to be carried out by air transportation centers of excellence. The Committee will be continuing and is currently in operation with an indefinite charter. The Committee is expected to meet twice per year, approximately every six months. If necessary, additional meetings may be added to address critical concerns. Unless otherwise required by law or approved by the Secretary, all meetings will be held virtually.
In this notice, the Department is soliciting nominations for membership to the Committee. The Committee shall report to the FAA Administrator and shall comprise approximately 30 members representing universities, corporations, associations, consumers, other government agencies, and regional centers of air transportation excellence. Members will serve 2-year terms but may be reappointed. Past members of the Committee are welcome to apply. The Department is interested in ensuring membership is balanced fairly in terms of the points of view represented and the functions to be performed by the Committee.
(1) Name, title, and relevant contact information (including phone, fax, and email address) of the individual requesting consideration;
(2) A letter of support from a company, union, trade association, academic, or nonprofit organization on letterhead containing a brief description of why the nominee should be considered for membership;
(3) A short biography of the nominee, including professional and academic credentials; and
(4) An affirmative statement that the nominee meets all Committee eligibility requirements and identifies which stakeholder group they would represent.
Please do not send company, trade association, or organization brochures or any other information. Materials submitted should total two pages or less. Should more information be needed, DOT staff will contact the nominee, obtain information from the nominee's past affiliations, or obtain information from publicly available sources, such as the internet.
Nominations must be received before October 30, 2025. Nominees selected for appointment to the Committee will be notified by return email and by a letter of appointment.
Issued in Washington, DC.
Pipeline and Hazardous Materials Safety Administration (PHMSA), DOT.
List of applications for special permits.
In accordance with the procedures governing the application for, and the processing of, special permits from the Department of Transportation's Hazardous Material Regulations, notice is hereby given that the Office of Hazardous Materials Safety has received the application described herein.
Comments must be received on or before October 30, 2025.
Record Center, Pipeline and Hazardous Materials Safety Administration U.S. Department of Transportation Washington, DC 20590.
Comments should refer to the application number and be submitted in triplicate. If confirmation of receipt of comments is desired, include a self-addressed stamped postcard showing the special permit number.
Donald Burger, Chief, Office of Hazardous Materials Safety General Approvals and Permits Branch, Pipeline and Hazardous Materials Safety Administration, U.S. Department of Transportation, East Building, PHH-13, 1200 New Jersey Avenue Southeast, Washington, DC 20590-0001, (202) 366-4535.
Each mode of transportation for which a particular special permit is requested is indicated by a number in the “Nature of Application” portion of the table below as follows: (1) Motor vehicle, (2) Rail freight, (3) Cargo vessel, (4) Cargo aircraft only, (5) Passenger-carrying aircraft.
Copies of the applications are available for inspection in the Records Center, East Building, PHH-13, 1200 New Jersey Avenue Southeast, Washington DC.
This notice of receipt of applications for special permit is published in accordance with part 107 of the Federal hazardous materials transportation law (49 U.S.C. 5117(b); 49 CFR 1.53(b)).
Pipeline and Hazardous Materials Safety Administration (PHMSA), DOT.
List of applications for modification of special permits.
In accordance with the procedures governing the application for, and the processing of, special permits from the Department of Transportation's Hazardous Material Regulations, notice is hereby given that the Office of Hazardous Materials Safety has received the application described herein.
Comments must be received on or before October 15, 2025.
Record Center, Pipeline and Hazardous Materials Safety Administration, U.S. Department of Transportation, Washington, DC 20590.
Comments should refer to the application number and be submitted in triplicate. If confirmation of receipt of comments is desired, include a self-addressed stamped postcard showing the special permit number.
Donald Burger, Chief, Office of Hazardous Materials Safety General Approvals and Permits Branch, Pipeline and Hazardous Materials Safety Administration, U.S. Department of Transportation, East Building, PHH-13, 1200 New Jersey Avenue Southeast, Washington, DC 20590-0001, (202) 366-4535.
Each mode of transportation for which a particular special permit is requested is indicated by a number in the “Nature of Application” portion of the table below as follows: (1) Motor vehicle, (2) Rail freight, (3) Cargo vessel, (4) Cargo aircraft only, (5) Passenger-carrying aircraft.
Copies of the applications are available for inspection in the Records Center, East Building, PHH-13, 1200 New Jersey Avenue Southeast, Washington, DC or at
This notice of receipt of applications for special permit is published in accordance with part 107 of the Federal hazardous materials transportation law (49 U.S.C. 5117(b); 49 CFR 1.53(b)).
Financial Crimes Enforcement Network (FinCEN), Treasury.
Notice and request for comments.
As part of its continuing efforts to reduce paperwork and respondent burden, FinCEN invites comments on the proposed renewal, without change, of existing information collection requirements found in Bank Secrecy Act (BSA) regulations concerning information sharing between government agencies and financial institutions. Specifically, the regulations require that, upon receiving an information request from FinCEN, a financial institution must search its records to determine whether it maintains or has maintained any account or engaged in any transaction with an individual, entity, or organization named in the request. If a financial institution identifies an account or transaction named in the request, it must report such information to FinCEN in the manner and timeframe specified in the request. This request for comment is being made pursuant to the Paperwork Reduction Act of 1995.
Written comments are welcome and must be received on or before December 1, 2025.
Comments may be submitted by any of the following methods:
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Please submit comments by one method only. Comments will be reviewed consistent with the Paperwork Reduction Act of 1995 and applicable OMB regulations and guidance. Do not include any personally identifiable information (such as name, address, or other contact information) or confidential business information that you do not want publicly disclosed. All comments are public records; they are publicly displayed exactly as received, and will not be deleted, modified, or redacted. Comments may be submitted anonymously.
FinCEN's Regulatory Support Section at
The legislative framework generally referred to as the BSA consists of the Currency and Foreign Transactions Reporting Act of 1970,
The BSA authorizes the Secretary of the Treasury (Secretary) to,
The USA PATRIOT Act charged the Department of the Treasury (Treasury) with developing regulations to facilitate information sharing among government entities and financial institutions for the purpose of combatting terrorism and money laundering. In 2002, FinCEN published a final rule implementing the authority contained in section 314(a) of the USA PATRIOT Act (the Section 314(a) Rule).
The requesting governmental entity must generally certify that each individual, entity, or organization about which the governmental entity is seeking information is engaged in, or is reasonably suspected based on credible evidence of engaging in, terrorist activity or money laundering. The requesting governmental entity must also provide FinCEN with information identifying each subject of a Section 314(a) Request, such as a name, date of birth (for an individual), address, and taxpayer identification number (TIN), or for an individual, social security number (SSN), or for an entity, employer identification number (EIN). The requesting governmental agency must also provide a point-of-contact (POC) who can be contacted by FinCEN or a financial institution in case there are any questions relating to the Section 314(a) Request.
Upon receiving a 314(a) Request, a financial institution is generally only required to search its records for: (i) any current account maintained for a named subject; (ii) any account maintained for a named subject during the preceding
A financial institution must report any matches to FinCEN, in the manner and in the timeframe specified in the Section 314(a) Request, and, as available, the following information: (i) the name of the match, such as the name of the individual, entity, or organization; (ii) the account number, or in the case of a transaction, the date and type of each such transaction; and (iii) any TIN information, passport number, date of birth, address, or other similar identifying information provided by the individual, entity, or organization when each such account was opened or each such transaction was conducted.
The Section 314(a) Rule also requires a financial institution, upon receiving a Section 314(a) Request, to provide to FinCEN a POC to receive future Section 314(a) Requests.
As set forth in 31 CFR 1010.520(a)(1), the information collection required under the Section 314(a) Rule, as described in this notice, pertains to an entity defined as a financial institution in 31 U.S.C. 5312(a)(2) but not necessarily defined as such in the regulations generally implementing the BSA.
While all the entities in Table 1 are required to respond to a Section 314(a) Request upon receipt, FinCEN generally only transmits a Section 314(a) Request to a limited subset of those financial institutions in any given year. Historically, the proportion of potentially affected financial institutions required to provide a response in a given year has remained below three percent. In 2024, for example, of the estimated 575,873 potential respondents, FinCEN transmitted Section 314(a) Requests to only 12,839 financial institutions, approximately 2.2 percent of the potentially affected population.
Of these respondents in 2024, approximately one third were banks or credit unions, nearly 15 percent were broker-dealers or mutual funds, and the remaining half were other types of covered financial institutions. This industry composition of respondent financial institutions (“Respondent FIs”) is broadly consistent with the distribution of estimated respondents at the time of the previous renewal which comprised “14,960 financial institutions, consisting of certain commercial banks, savings associations, and credit unions, broker or dealers in securities, future commission merchants, trust companies, life insurance companies, mutual funds and money services businesses.”
Over the period between 2023 and 2025, FinCEN sent, on behalf of itself or state and local or foreign law enforcement,
Table 2 provides a summary of requests and responses by the number of affected financial institutions since the last OMB control number renewal. The scope of new data used to update PRA estimates begins with calendar year 2023,
Despite certain changes to its methodological approach in this notice, FinCEN results are broadly consistent with the previous
The analysis also briefly reviews where changes in the mechanisms and processes by which the Section 314(a) Program operates that have become standard practice since prior OMB control number renewals are expected to affect anticipated burdens. Furthermore, consistent with the purposes of the PRA,
31 CFR 1010.520 includes subsections that FinCEN does not expect to impose PRA reporting or recordkeeping burdens despite being integral to the overall design and operations of the Section 314(a) Program. These include subsections 1010.520(a)(1)-(2), (b)(2), (b)(3)(iv)(B)(1)-(2), (b)(3)(v), and (b)(4)-(5). Public response is invited to the extent that commenters believe additional burden accrues because of these provisions, and should be included in future renewals.
31 CFR 1010.520 sets forth the requirements for parties that would initiate a Section 314(a) Request. Table 3
31 CFR 1010.520(b)(1) details the expectations of, and obligations accruing to, an LEA that wants FinCEN to distribute a Section 314(a) Request on its behalf, including (1) the certification, (2) the list of subjects and associated information, and (3) the designation of an LEA POC.
FinCEN believes all the information included in the certification set forth in 31 CFR 1010.520(b)(1) is not subject to the PRA, but even if some of it were, the incremental PRA burden of providing such information on affected LEAs is
As set forth in 31 CFR 1010.520(b)(3)(i), a Respondent FI, when searching for an account matching a named suspect, need only search for any current account maintained by a named suspect and any account maintained for a named suspect within the last preceding twelve months.
When a Respondent FI receives a Section 314(a) Request, it is provided a list of subjects identified by name,
To prepare a response, Respondent FIs must search their records for data matches, including accounts maintained by the named subject(s) during the preceding 12 months and non-account-related transactions conducted within the past 6 months. FinCEN expects that executing this may involve two types of activity: automated search and manual review. FinCEN presumes that all Respondent FIs first conduct an automated search by querying their records for positive matches to accounts maintained or transactions conducted with the subject(s) of a Section 314(a) Request. If that search yields records that appear to match, additional manual review is conducted to verify that identified matches are correct and that in each case the automated query has not identified a false positive match.
FinCEN expects that there may be substantial variation in the search time associated with the subject(s) of a Section 314(a) Request depending on the quality of the identified match. In cases where automated search results are relatively unambiguous,
31 CFR 1010.520(b)(3)(ii) delineates the required response if a Respondent FI identifies a matching account or transaction. To minimize burden on financial institutions, financial institutions only must confirm with FinCEN that they have a positive match to the subject of a Section 314(a) Request.
Responses to Section 314(a) Requests are expected to occur within two
FinCEN is not assigning a recordkeeping burden to this provision because financial institutions are not required to maintain records related to Section 314(a) Requests. Nevertheless, some Respondent FIs may choose to maintain records as part of their broader compliance program to demonstrate that all required searches have been performed and positive matches reported. Respondent FIs who wish to do so may obtain an activity report via FinCEN's secure portal, which provides download and response history. To the extent that burden is incurred by these activities, FinCEN expects that this would be captured by the recordkeeping burden hours assigned to 31 CFR 1010.520(b)(3)(iv)(A) as described below.
As previously described,
31 CFR 1010.520(b)(3)(iv)(A) provides that Respondent FIs may not use information obtained by a Section 314(a) Request for purposes other than responding to FinCEN's request
31 CFR 1010.520(b)(3)(iv)(C) provides that a Respondent FI shall maintain adequate procedures to protect the security and confidentially of Section 314(a) Requests. To account for this and other technology and data security costs associated with a Respondent FI's Section 314(a) program, FinCEN is assigning a $0.10 non-labor cost to each response.
The estimated burden per respondent includes the time associated with responding to Section 314(a) Requests (approximately 39 hours per respondent, on average)
Under the PRA, FinCEN as a Federal agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Records required to be retained under the BSA must be retained for five years.
In connection with a variety of initiatives FinCEN is undertaking to implement the AML Act, FinCEN intends to conduct, in the future, additional assessments of the PRA burden associated with BSA requirements. To assist with those activities, FinCEN is also requesting comments in response to the following additional questions:
1. FinCEN invites comment on its analytical approach in this OMB control number renewal. Does the new structure of the analysis more accurately reflect the experiences and costs incurred by participants in the Section 314(a) Program? Should alternative approaches be considered? If so, please describe.
2. FinCEN Section 314(a) Program burden estimates do not currently include an itemized consideration of information collections or reporting costs to State, local, and foreign law enforcement when originating Section 314(a) Requests because FinCEN believes the costs are
3. Are there start-up technology costs, such as costs to extend or further customize existing electronic records systems, that a potentially affected financial institution would need to incur as new respondents that FinCEN should separately itemize as an expected Section 314(a) Program cost? If so, please describe.
4. To what extent can a financial institution that would newly become a respondent be able to rely on third-party services, existing software, or other products to receive and process Section 314(a) Requests?
5. On average, how long does it take to ingest or otherwise upload a Section 314(a) Request to a Respondent FI's automated system and perform an electronic query for its subjects? Approximately how long does it take per subject? Are there meaningful differences in automated search time depending on subject type (
6. In what proportion do query results from a Respondent FI's automated search identify a potential match to a Section 314(a) Request subject that is ultimately determined to be a false positive? Are there ever instances where an automated search does not yield a match but a Respondent FI identifies this as a false negative?
7. What steps are taken, once an automated system generates a match, to determine if it is an actual match or a false positive? Approximately how much time is required, on average, to make a determination? Are there meaningful differences in time expended by outcome? By subject type?
8. What type of records are produced to document the results of this type of research? What type of records are maintained to document that a Section 314(a) Request search has been conducted? Are there meaningful differences in the time cost of recordkeeping that depend on the results of the search (
9. In practice, are there any cases where non-electronic records are searched or reviewed in connection with a Section 314(a) Request? If so, please describe the general frequency and nature of these instances.
10. 31 CFR 1010.520(b)(3)(i) provides that a Respondent FI may contact a Section 314(a) Request's designated Requestor POC if they have questions about the scope or terms or the request. What proportion of requests and what proportion of subjects necessitate such contact? In each case, how many times is contact typically required? How much time is spent on communications with this contact, per instance and per 314(a) request? Is this outreach usually part of the research activities specifically related to ambiguous query search results or to other aspects of the request?
11. Is it reasonable to assume that the average financial institution that is, or becomes, a respondent employs more than one person, or relies on employees in more than one occupational category, to conduct and review Section 314(a) Request searches?
12. This analysis uses a standard index wage rate that accounts for multiple occupational roles involved in reporting and recordkeeping activities. To what extent does this approach reflect how financial institutions conduct Section 314(a) Request-related activities? Do these activities generally involve several occupational roles, or would a single wage rate be more appropriate? If the work involves more
13. What is the typical occupation of an individual assigned by a financial institution to serve as their Section 314(a) POC? Approximately how much of their total labor is allocated to this function? Approximately what proportion of potentially affected financial institutions that have never been a Respondent FI have assigned a Section 314(a) POC in advance?
14. FinCEN's use of an index wage rate to estimate time costs assumes senior management participates in Section 314(a) Program activities. How often and to what extent do such persons typically review the search results for subjects of Section 314(a) Requests? How often and to what extent do such persons typically review their financial institution's Section 314(a) Program policies and procedures?
15. Does senior management typically evaluate policies, procedures, and activities related to the privacy and security of Section 314(a) Program-related data as a standalone activity or as part of broader review of their financial institution's data privacy and security practices?
Financial Crimes Enforcement Network (FinCEN), Treasury.
Notice and request for comments.
The Financial Crimes Enforcement Network (FinCEN), as part of its obligations under the Paperwork Reduction Act of 1995 (PRA), invites the general public and other Federal agencies to take this opportunity to comment on a proposed information collection, a Survey of the Costs of Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Compliance. The survey seeks to gather information on the direct compliance costs incurred by non-bank financial institutions (NBFIs), described below, with AML/CFT compliance requirements and, to the extent these expenses overlap with those of other activities (such as fraud monitoring), the amount attributable to AML/CFT compliance. FinCEN is seeking a new Office of Management and Budget (OMB) Control Number for this information collection.
Written comments are welcome and must be received on or before December 1, 2025.
Comments may be submitted by any of the following methods:
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Please submit comments by one method only. Comments will be reviewed consistent with the PRA and applicable OMB regulations and guidance. Do not include any personally identifiable information (such as name, address, or other contact information) or confidential business information that you do not want publicly disclosed. All comments are public records; they are publicly displayed exactly as received, and will not be deleted, modified, or redacted. Comments may be submitted anonymously.
A copy of the comments may also be submitted to the OMB desk officer for FinCEN: Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Washington, DC 20503.
FinCEN's Regulatory Support Section by submitting an inquiry at
FinCEN is requesting OMB approval for the following collection of information:
Interested members of the public may view the proposed survey questionnaire on the following web page:
Comments are invited on: (a) whether the collection of information is necessary for the proper performance of FinCEN's functions, including whether the information has practical utility; (b) the accuracy of the estimates of the burden of the information collections, including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. All comments will become a matter of public record.
Departmental Offices, Department of the Treasury.
The Department of the Treasury, as part of its continuing effort to reduce paperwork burdens, invites the general public and other Federal agencies to comment on renewal of a currently approved information collection that is to be proposed for approval by the Office of Management and Budget. The Office of International Affairs within the Department of the Treasury is soliciting comments concerning Treasury International Capital (TIC) Forms BC, BL-1, BL-2, BQ-1, BQ-2, and BQ-3 (called the “TIC B forms”). The collections are mandatory.
Written comments should be received on or before December 1, 2025 to be assured of consideration.
Direct all written comments to Dwight Wolkow, International Portfolio Investment Data Systems, Department of the Treasury, Room 1050, 1500 Pennsylvania Avenue NW, Washington, DC 20220. In view of possible delays in mail delivery, please also notify Mr. Wolkow by email (
Copies of the proposed forms and instructions are available on the Treasury's TIC Forms web page,
Departmental Offices; Department of the Treasury.
The Department of the Treasury, as part of its continuing effort to reduce paperwork burdens, invites the general public and other Federal agencies to comment on renewal of a currently approved information collection that is to be proposed for approval by the Office of Management and Budget. The Office of International Affairs of the Department of the Treasury is soliciting comments concerning Treasury International Capital (TIC) Forms CQ-1 and CQ-2, “Financial and Commercial Liabilities to, and Claims on, Unaffiliated Foreign Residents.” The collections are mandatory.
Written comments should be received on or before December 1, 2025 to be assured of consideration.
Direct all written comments to Dwight Wolkow, International Portfolio Investment Data Systems, Department of the Treasury, Room 1050, 1500 Pennsylvania Avenue NW, Washington, DC 20220. In view of possible delays in mail delivery, please also notify Mr. Wolkow by email (
Copies of the proposed forms and instructions are available on the Treasury's TIC Forms web page,
Commodity Futures Trading Commission.
Notice of proposed rulemaking.
The Commodity Futures Trading Commission (“CFTC” or “Commission”) is proposing amendments to certain of the Commission's business conduct and documentation requirements applicable to swap dealers and major swap participants. These amendments would provide exceptions to compliance with such requirements when executing swaps that are: intended by the parties to be cleared contemporaneously with execution; or subject to prime broker arrangements that meet certain qualifying conditions. The proposed amendments would also make certain other changes discussed herein. The proposed amendments, if adopted, would supersede certain no-action positions issued by the Commission's Market Participants Division (“MPD”).
Comments must be received on or before October 24, 2025.
You may submit comments, identified by “
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Please submit your comments using only one of these methods. To avoid possible delays with mail or in-person deliveries, submissions through the CFTC Comments Portal are encouraged.
All comments must be submitted in English, or if not, accompanied by an English translation. Comments will be posted as received to
Frank N. Fisanich, Deputy Director, 202-418-5949,
The Commission is issuing this notice of proposed rulemaking (“Proposal”) to propose amendments to certain business conduct standards for swap dealers (“SDs”) and major swap participants (“MSPs” and, together with SDs, “Swap Entities”)
Together, the Covered Staff Letters provided no-action positions regarding compliance with certain external business conduct standards (including certain required pre-trade disclosures) and documentation requirements applicable to Swap Entities in the context of: (1) swaps executed pursuant to prime broker arrangements between SDs acting as prime brokers and their customers; and (2) swaps executed by Swap Entities with counterparties where the parties to the swap intend the swap to be cleared contemporaneously with execution of such swap. The Commission expects that, upon the adoption of a final rule enacting this Proposal, MPD will withdraw some or all of the Covered Staff Letters as necessary to reflect the Commission's final rule.
Section 4s(h) of the CEA
The External Business Conduct Standards include certain pre-trade disclosures required to be made by Swap Entities to their counterparties that are not Swap Entities, security-based swap dealers, or security-based major swap participants, including a requirement under § 23.431(a)(3)(i) to disclose the price of the swap and the so-called “pre-trade mid-market mark” (the “PTMMM”; and such disclosure requirement, the “PTMMM Requirement”).
The External Business Conduct Standards also include a requirement under § 23.431(b) that an SD must provide counterparties that are not Swap Entities, security-based swap dealers, or security-based major swap participants with notice that the counterparty may request and consult on the design of a scenario analysis to allow the counterparty to assess its potential exposure in connection with a swap (the “Scenario Analysis Requirement”).
Section 4s(i) of the CEA requires the Commission to adopt rules governing swap documentation for Swap Entities.
In 2013, MPD issued CFTC Staff Letter 13-70
In addition, in 2022, MPD recognized that the Commission had exempted a number of non-U.S. central clearing counterparties from registration as a DCO and a number of non-U.S. trading facilities from registration as a SEF. Specifically, section 5b(h) of the CEA
Similarly, section 5h(g) of the CEA authorizes the Commission to exempt, conditionally or unconditionally, a SEF from registration, if the Commission finds that the facility is “subject to comparable, comprehensive supervision and regulation on a consolidated basis by . . . the appropriate governmental authorities in the home country of the facility.”
Because Swap Entities that are otherwise subject to the Commission's External Business Conduct Standards and documentation requirements are free to execute swaps on Exempt SEFs and clear swaps on Exempt DCOs pursuant to, and subject to the conditions of, the foregoing Commission actions, MPD recognized that execution by Swap Entities of ITBC Swaps on an Exempt SEF and/or clearing of such ITBC Swaps on an Exempt DCO should be treated the same as swaps executed on DCMs or SEFs and/or cleared on DCOs. Consequently, MPD issued CFTC Staff Letter 23-01, which superseded CFTC Staff Letter 13-70 in its entirety.
The Commission has preliminarily determined that the standardization that occurs when a type of swap is made available to trade on a SEF
The Commission has also preliminarily determined that because swaps, once cleared, are between the DCO and the market participant (not between the Swap Entity and its counterparty) and there is no ongoing trading relationship between the Swap Entity and its counterparty, compliance by a Swap Entity with the on-boarding requirements of the External Business Conduct Standards or the STRD Requirement represents a significant hinderance to the efficient trading of cleared swaps.
In 2013, MPD recognized that execution of swaps pursuant to long-standing conditions present in swap prime broker arrangements prevalent in the swap market made compliance with certain requirements under the External Business Conduct Standards by SDs operating as prime brokers (“PBs”) impossible due to the structure and information flows of these arrangements.
PBs engaging in these swaps provide credit intermediation for their PB customers while permitting such customers to solicit prices from a wide variety of swap market participants. The PB customer agrees on a price and other critical terms of a swap with a potential swap counterparty, but the swap is actually executed at that price and on those terms between the PB and the counterparty chosen by the PB's customer (the “trigger swap”). The PB, in turn, then enters into a matching swap with its customer (the “mirror swap”). Thus, the customer has the advantage of seeking favorable prices while maintaining a credit relationship with only its PB, simplifying its operations and benefiting from collateral netting. The PB enters into two equal but opposite swaps and thus all but eliminates its market risk and has only credit risk to its customer and the trigger swap counterparty (
However, because the PB arrangement permits the PB customer to seek prices from various counterparties, the PB cannot know the price or the exact terms of the swap before the PB is obligated to execute both the trigger swap and the mirror swap. This lack of information may prevent a PB that is an SD from complying with certain pre-trade regulatory obligations under the External Business Conduct Standards, most notably the pre-trade disclosure of the price and a PTMMM of the swaps as required by § 23.431(a)(3).
Recognizing these structural and informational hurdles to compliance with the External Business Conduct Standards, MPD issued a no-action position in CFTC Staff Letter 13-11 with respect to enumerated External Business Conduct Standards as they relate to certain covered transactions
In addition, MPD recognized that many trigger swap counterparties transacting in the market for foreign exchange swaps and forwards that were exempted from the swap definition pursuant to the Treasury Determination (“Exempt FX Transactions”)
Finally, in 2019, MPD recognized that certain PB transactions executed anonymously on SEFs raised additional structural and informational hurdles to compliance with the disclosure requirements of §§ 23.431(a) and (b)
The Commission has preliminarily determined that PB arrangements common in the swaps and Exempt FX Transaction markets prior to promulgation of the External Business Conduct Standards present significant structural and informational hurdles to compliance with the disclosure requirements of §§ 23.431(a) and (b).
In 2013, MPD provided a no-action position in CFTC Staff Letter 13-12 (which was a revision of CFTC Staff Letter 12-42)
MPD provided a substantially similar no-action position in CFTC Staff Letter 12-58, stating that it would not recommend enforcement action against a Swap Entity for failure to disclose a PTMMM for certain widely-traded interest rate swap or index credit default swaps,
Finally, MPD provided a no-action position in CFTC Staff Letter 25-09, stating that it would not recommend that the Commission commence an enforcement action against a Swap Entity for failure to satisfy the PTMMM Requirement for its non-Swap Entity counterparties. MPD issued CFTC Staff Letter 25-09 in response to a request from certain trade associations representing a wide breadth of swap market participants who argued that: (1) the PTMMM Requirement does not provide any significant informational value to a Swap Entity's counterparties; (2) the PTMMM Requirement imposes significant operational burdens on Swap Entities and, at worst, impedes the prompt execution of swaps transactions; and (3) the elimination of the PTMMM Requirement would further harmonize the Commission's regulations with those of the United States (“U.S.”) Securities and Exchange Commission (“SEC”) applicable to security-based swap dealers and major security-based swap participants, which do not require disclosure of a PTMMM in relation to security-based swaps. The no-action position in CFTC Staff Letter 25-09 will remain in effect until the adoption by the Commission of a regulation addressing the PTMMM Requirement, such as this Proposal.
As discussed below, the Commission has preliminarily determined that the PTMMM Requirement provides no useful information to counterparties and delays efficient execution; and is, thus, proposing to eliminate the PTMMM Requirement in its entirety. The Commission notes that its repeal of the PTMMM Requirement in a final rule would render the MPD no-action positions in CFTC Staff Letters 12-58, 13-12, and 25-09 moot; and it would therefore expect that MPD would withdraw such positions in due course.
The Commission is proposing certain amendments to the External Business Conduct Standards and the STRD Requirement, as described in this Section, that would provide exceptions to compliance with such requirements when executing swaps that are: (1) intended by the parties to be cleared contemporaneously with execution; or (2) subject to prime broker arrangements that meet certain qualifying conditions. The proposed amendments would also make certain other changes discussed herein, including eliminating the PTMMM Requirement. In addition, as a simplifying amendment as discussed above, the Commission is proposing to replace each reference in the External Business Conduct Standards to “swap dealer and major swap participant” with a reference to “swap entity,” as defined
The Commission requests comment on all aspects of the proposed amendments described below and has inserted more specific questions and requests for comment in numerical order in the discussion below. The Commission requests that commenters refer to the specific question number or request for comment in any response, if applicable.
The Commission is requesting comment on a proposal that the Swap Entity PTMMM Requirement set forth in § 23.431(a)(3)(i)
The Commission has several reasons for making this proposal based on its experience since 2013 when Swap Entity compliance with the External Business Conduct Standards was first required.
Although the Commission believed that the PTMMM Requirement would provide counterparties with “pricing information that facilitates negotiations and balances historical information asymmetry regarding swap pricing,”
The Commission also preliminarily believes that the no-action positions provided by MPD in the Covered Staff Letters show that the PTMMM Requirement has been unworkable in a wide variety of contexts in which uncleared swaps are executed between Swap Entities and their non-Swap Entity counterparties. This includes swaps executed pursuant to PB arrangements where a PB that is an SD does not know the price of a swap until after it is obligated to enter into the swap. It also includes, as discussed above, ITBC Swaps where the Swap Entities do not know the identity of their counterparty prior to execution, and widely-traded, highly-liquid swaps where the disclosure of a PTMMM is redundant because bid/offer prices are readily available to potential counterparties from trading and price information platforms.
In addition to the foregoing, the Commission notes that the PTMMM Requirement, unlike the uncleared swap daily mark disclosure requirement promulgated in § 23.431(d)(2),
The Commission is requesting comment on a proposal that the Scenario Analysis Requirement set forth in § 23.431(b)
The Commission is making this proposal to eliminate the Scenario Analysis Requirement based on its experience since 2013, when Swap Entity compliance with the External Business Conduct Standards was first required. The Commission notes that the Scenario Analysis Requirement was not required by the Dodd-Frank Act amendments to the CEA.
In adopting the Scenario Analysis Requirement in 2012, the Commission stated that it believed the requirement would assist to “materially enhance the ability of counterparties to assess the merits of entering into any particular swap transaction and reduce information asymmetries between swap dealers . . . and their counterparties.”
The Commission is proposing to amend the daily mark disclosure requirement in § 23.431(d)(2)
Section 4s(h)(3)(B) of the CEA required the Commission to adopt disclosure requirements for Swap Entities, including a requirement that a Swap Entity disclose a daily mark for uncleared swaps entered into with non-Swap Entities, but did not define “daily mark” or describe how it was to be calculated.
However, although the swap data reporting rules in part 45 of the Commission's regulations define “valuation data” by cross-referencing § 23.431,
In contrast, the Commission's uncleared margin rules
Thus, based on the foregoing, on any business day, a Swap Entity may be required to calculate the valuation of a swap for three different purposes using three similar but not identical criteria for purposes of: (1) providing the daily mark of the swap to its counterparty under § 23.431(d)(2); (2) reporting valuation data for the swap to a swap data repository under § 45.4(c)(2); and (3) calculating the variation margin amount for the swap under § 23.155. To harmonize these similar but not identical calculations so that a Swap Entity is only required to make a single calculation of the valuation of the swap, the Commission is proposing to amend § 23.431(d)(2) (renumbered as
The Commission believes that under this formulation non-Swap Entity counterparties would receive the daily mark required by section 4s(h)(3)(B) of the CEA, but a Swap Entity would only be required to calculate the valuation of a swap once daily and use the result of such calculation to provide the daily mark to its counterparty in compliance with § 23.431, and, if otherwise required, use such result for reporting valuation data to a swap data repository in compliance with § 45.4 and for purposes of calculating the variation margin amount in compliance with § 23.155.
The Commission is proposing to add new definitions to § 23.401
The Commission is proposing to add a new definition of “ITBC Swap” to the definitions in § 23.401 applicable to subpart H of part 23 of the Commission's regulations.
First, under the Proposal, one of the parties to the swap must be a swap entity, as defined in new § 23.401(j) to mean an SD or MSP. “Swap entity” is used throughout the definitions and the proposed amendments to refer to an SD or MSP. The External Business Conduct Standards and the STRD Requirement only apply to Swap Entities. Thus, swaps where no Swap Entity is a counterparty have no need to qualify for the ITBC Compliance Exceptions.
Second, the swap would be required to be of a type accepted for clearing by a DCO registered with the Commission or an Exempt DCO.
Third, the parties to the swap would be required to execute the swap with the present intention that the swap will be cleared contemporaneously with execution. The ITBC Compliance Exceptions would not be available for a swap that is entered bilaterally between two parties who then decide later that they would like to submit the swap for clearing. As discussed in the seventh condition below requiring submission of an ITBC Swap to a DCO or Exempt DCO as soon as practicable, a swap that is not intended to be cleared contemporaneously with execution means that there will be a trading relationship between the Swap Entity and its counterparty for some material period of time, which would necessitate compliance by the Swap Entity with the Commission's swap reporting, disclosure, and uncleared swap margin rules. While parties are free to enter into swaps that they intend to clear but are not cleared contemporaneously with execution, such swaps would not be ITBC Swaps and such swaps would not qualify for the ITBC Swap Compliance Exceptions.
Fourth, if the swap is intended to be cleared on a DCO, the Swap Entity and its counterparty would be required to either be clearing members of the DCO or have entered into an agreement with a clearing member of the DCO (
Fifth, if the swap is intended to be cleared on an Exempt DCO, the Swap Entity and its counterparty would be required to be eligible to clear the swap on the Exempt DCO in accordance with the terms and conditions of the Exempt DCO's Order of Exemption from Registration issued by the Commission. Each Exempt DCO is exempt from registration pursuant to a unique order issued by the Commission, which may contain conditions and limitations to the Exempt DCO's ability to clear certain products for or on behalf of U.S. Persons pursuant to that order.
Sixth, the Swap Entity would be prohibited from requiring its counterparty or the counterparty's clearing member (
Seventh, the Swap Entity would be required to ensure that the swap is submitted for clearing as quickly after execution as would be technologically practicable if fully automated systems were used. This proposed condition sets forth a standard for
Eighth, the Commission is proposing to require that if the swap is executed on a DCM, SEF, or Exempt SEF and is rejected from clearing, the swap must be void
Compliance with this condition may be accomplished by executing the swap on a SEF or DCM where such SEF or DCM is required to have rules requiring swaps submitted for clearing to be void
The Commission proposes to add a new definition of “A-ITBC Swap” to the definitions in § 23.401
The Commission proposes to add a new definition of “Covered Transaction” to the definitions in § 23.401
The Commission proposes to add a new definition of “Prime Broker Arrangement” to the definitions in § 23.401
A Prime Broker Arrangement as proposed to be defined in § 23.401 would include at least one PB/SD and two or more other parties evidenced by a written agreement or agreements.
The proposed “substantially equal but opposite” requirement is a recognition by the Commission that the terms and the price of a Mirror Transaction may be adjusted from those of a Trigger Transaction to allow for a spread or fee to be paid to the PB/SD, (or to an intermediary that has arranged the transaction), to compensate the PB/SD or the intermediary for providing the credit intermediation service evidenced by the Prime Broker Arrangement or the intermediary's services. The Commission also recognizes that the designation of a Trigger Transaction and a Mirror Transaction depends on the perspective of the parties to the transaction. For example, where two PBs are involved, the Mirror Transaction for one PB may be a Trigger Transaction for the second PB. The Commission is also aware that a single Trigger Transaction may trigger a string of transactions between various PBs and their PB customers, some of which could be both Trigger Transactions and Mirror Transactions.
The intention of the proposed definition of Prime Broker Arrangement is to capture the essence of the concept of credit intermediation through swap PB arrangements as it relates to compliance with the External Business Conduct Standards. In the Commission's preliminary view, such
The Commission proposes to add a new definition of “Qualified Prime Broker Arrangement” to the definitions in § 23.401
The Commission has preliminarily determined that providing an exception from the price disclosure obligation (and, if necessary, the PTMMM disclosure obligation) of an SD when entering into a swap pursuant to a Qualified Prime Broker Arrangement is a reasonable accommodation to the long-standing prime broker arrangements prevalent in the swaps market prior to promulgation of the External Business Conduct Standards. The Commission's view is based on the fact that Prime Broker Arrangements are entered into by swap counterparties seeking certain benefits, among which are: (1) the ability of swap counterparties to seek favorable pricing from a wide variety of market participants, rather than just a handful of SDs with which they may have trading relationships; (2) the credit intermediation provided by PBs that permits price shopping by swap counterparties but consolidates credit risk of the swap counterparty with only their PB(s); and (3) the consolidation of credit risk with only their PB(s) that permits for more efficient use of collateral through netting of positions with only their PB(s). In the Commission's preliminary view, an insistence on price disclosure (and, if necessary, a PTMMM disclosure) by an SD acting as a PB, a requirement that was intended to provide a benefit to non-Swap Entity counterparties, would undermine that very benefit and eliminate all of the other benefits of Prime Broker Arrangements to swap counterparties, forcing such counterparties to trade swaps only with a handful of SDs with the concomitant loss of competitive pricing. Thus, the Commission has determined to propose the following conditions for a Qualified Prime Broker Arrangement that would qualify for an exception to the price disclosure (and, if necessary, the PTMMM disclosure) requirement.
First, to qualify as a Qualified Prime Broker Arrangement, the Prime Broker Arrangement between a PB/SD and its PB Counterparty would be required to contain an agreement in writing on the type, parameters, and limits of each potential Covered Transaction that may be entered into by the PB Counterparty with the PB/SD pursuant to the Prime Broker Arrangement (each, a “Permitted PB Transaction”). This proposed condition would require the PB/SD to:
(1) Clearly delineate the types of transactions that the PB/SD will be obligated to enter into with the PB Counterparty pursuant to the Prime Broker Arrangement;
(2) To list all of the pre-conditions to the PB/SD's obligation to enter into each type of Permitted PB Transaction;
(3) To list all acceptable terms for each type of Permitted PB Transaction (such as tenor, payment terms, payment calculation terms, termination events, rate fallbacks, etc.); and
(4) To set limits (credit, market, trade volume, etc.) for each type of Permitted PB Transaction.
The purpose of this proposed condition is to ensure that, before execution of any Covered Transaction, the parties will know exactly what the PB/SD is required to execute with the PB Counterparty, thereby making compliance with the other conditions of the Qualified Prime Broker Arrangement definition possible. A PB/SD and its PB Counterparty would, of course, be free to update or adjust the parameters of Permitted PB Transactions at any time by agreeing to an amendment to their Prime Broker Arrangement.
Second, the PB/SD, now knowing the types and terms of all possible Covered Transactions that may be executed with the PB Counterparty pursuant to their Prime Broker Arrangement, would be required to provide the PB Counterparty with all disclosures that would be necessary for the Prime Broker to comply with § 23.431(a)
(1) The material risks of a particular type of Permitted PB Transaction, which may include market, credit, liquidity, foreign currency, legal, operational, and any other applicable risks;
(2) The material characteristics of a particular type of Permitted PB Transaction, which would include the
(3) The material incentives and conflicts of interest that the PB/SD may have in connection with a particular type of Permitted PB Transaction, which would include any compensation or other incentive from any source other than the PB Counterparty that the PB/SD may receive in connection with a particular type of Permitted PB Transaction.
As proposed, the disclosure obligation of the PB/SD under this second condition would be limited to the PB/SD's knowledge and reasonable belief at the time of disclosure. The Commission would consider a PB/SD to have met this condition if such disclosure is substantially the same as its disclosures to non-PB Counterparties for the same types of Covered Transactions, so long as such disclosures to non-PB Counterparties are not found deficient. The Commission notes that this condition would impose an on-going disclosure requirement that must be updated to the extent the PB/SD becomes aware of information that would make a previous disclosure incorrect, incomplete, or misleading.
Third, the PB/SD would be required to receive an acknowledgement from a PB Counterparty regarding various disclosures. The acknowledgement would state that: (1) the PB Counterparty has received the Regulatory Disclosures; and (2) the PB/SD has clarified or supplemented the Regulatory Disclosures as requested by the PB Counterparty in its sole discretion. Furthermore, the acknowledgement would provide that the PB/SD has no obligation to provide additional disclosures pursuant to section 4s(h)(3)(B)(i) of the CEA
Finally, the PB/SD would be required to make and keep a record of the Prime Broker Arrangement and the required acknowledgement from its PB Counterparty until the expiration or termination of all Permitted PB Transactions executed pursuant to the Prime Broker Arrangement, and for five years thereafter, in accordance with the SD recordkeeping rule, § 23.203.
The Commission acknowledges that the proposed Qualified Prime Broker Arrangement set forth in this Proposal differs significantly from the MPD no-action position set forth in CFTC Staff Letter 13-11. The no-action position in CFTC Staff Letter 13-11 was conditioned, in part, on a PB/SD allocating its obligations under certain External Business Conduct Standards to another SD, effectively limiting some part of the prime brokerage market in swaps to participation only by SDs registered with the Commission.
However, the Commission notes that another part of the no-action position set forth in CFTC Staff Letter 13-11, applicable only to Exempt FX Transactions, was not conditioned on an allocation of External Business Conduct Standard obligations from one SD to another, but rather was predicated on MPD's view that the only obligations impossible or impracticable for a PB/SD to perform in the context of swap prime brokerage are the obligations to provide a pre-trade price and a PTMMM.
In general, § 23.402 (General provisions) requires or allows Swap Entities to (a) have written policies and procedures reasonably designed to ensure compliance with the External Business Conduct Standards; (b) obtain “know-your-counterparty” (“KYC”) information about their swap counterparties; (c) reasonably rely on representations obtained from their swap counterparties; (d) agree with counterparties on how information required to be obtained or disclosed to swap counterparties will be communicated; and (e) comply with recordkeeping requirements.
The Commission proposes to amend § 23.402 by adding a new subparagraph (h) thereto that would state “Paragraph (b) and (c) of this section shall not apply to an ITBC Swap.” This proposed amendment would make clear that because ITBC Swaps are executed with counterparties with the intention to be cleared (and are generally void
In general, § 23.430 (Verification of counterparty eligibility) requires Swap Entities to (a) verify the ECP status of each swap counterparty; (b) verify whether a swap counterparty is a Special Entity (as defined in § 23.401); and (c) notify swap counterparties of any right to elect to be a Special Entity available under the definition of Special Entity in § 23.401(c)(6).
Subparagraph (e) of § 23.430 provides that these verifications and notice requirements will not apply to swaps initiated on a DCM or, where the Swap Entity does not know the identity of the counterparty prior to execution, a SEF.
The Commission proposes to amend § 23.430(e) by adding a further provision stating that the verification and notice requirements will not apply to A-ITBC Swaps or to ITBC Swaps that are initiated on a DCM, SEF, or Exempt SEF. This proposed amendment would make clear that because ITBC Swaps are executed with counterparties with the intention to be cleared (and are generally void
Additionally, with regard to A-ITBC Swaps, Swap Entities will not know, and may never know, the identity of the swap counterparty, making it impossible to comply with the verification and notification requirements of § 23.430.
In general, § 23.431 requires Swap Entities to (a) disclose to non-Swap Entity counterparties the material risks, characteristics, incentives, and conflicts of interest of any swap prior to entering into the swap; (b) provide the pre-trade price and the PTMMM of a swap to a non-Swap Entity counterparty prior to entering into the swap; (c) provide a scenario analysis of a swap if requested by a non-Swap Entity counterparty prior to entering into the swap; (d) provide non-Swap Entity counterparties that enter into cleared swaps with the Swap Entity with notice of the counterparty's right to receive, upon request, the daily mark for such cleared swaps from the appropriate DCO; and (e) provide the daily mark of an executed uncleared swap to a non-Swap Entity counterparty to such swap as of each business day from the execution of the swap to its expiration or termination.
Subparagraph (c) of § 23.431 provides that the pre-trade disclosure obligations of §§ 23.431(a) and (b) will not apply to transactions that are initiated on a DCM or SEF where the Swap Entity does not know the identity of the counterparty prior to execution.
The Commission proposes to amend § 23.431 by:
(1) Eliminating the PTMMM requirement as discussed in Section II.A. above;
(2) Eliminating the Scenario Analysis Requirement as discussed in Section II.B. above;
(3) Clarifying that a Swap Entity is not required to disclose to its counterparty information relating to the material characteristics of a particular swap to the extent that such characteristics are reflected in transaction documents that the counterparty has been provided prior to entering into the swap;
(4) Expanding the exception for pre-trade disclosures in subparagraph (c) to include (i) swaps executed
(5) Adding a new subparagraph (2) to § 23.431(d) (Daily mark) that would disapply the notice required to be given to cleared swap counterparties of the right to receive a daily mark from the clearing DCO for ITBC Swaps executed on a DCM, SEF or Exempt SEF and for any A-ITBC Swap;
(6) Revising the uncleared daily mark requirement in § 23.431(d)(2) (renumbered as proposed to be (d)(3)) as discussed in Section II.C. above; and
(7) Revising § 23.431(d)(3)(ii) (renumbered as proposed to be (d)(4)(ii)) to make clear that a Swap Entity may disclose to its non-Swap Entity counterparties that the daily mark provided to the counterparty each business day for existing swaps is an estimate only.
These proposed amendments reflect the Commission's preliminary view that:
(1) ITBC Swaps (including A-ITBC Swaps) are only swaps executed by a counterparty with the present intention to clear the swap and thus the counterparty has no need to receive notice of a right to receive a daily mark from the Swap Entity because the counterparty will face a clearing house;
(2) Swap Entities do not know the identity of their counterparties to A-ITBC Swaps prior to execution;
(3) Swaps may be executed by Swap Entities on or pursuant to the rules of Exempt SEFs and may clear swaps, if eligible, on Exempt DCOs;
(4) Swaps accepted for clearing on a DCO or Exempt DCO (especially those also listed for trading on DCM, SEF, or Exempt SEF) are sufficiently standardized and information about the material risks and characteristics of such swaps are available from the DCO or Exempt DCO (and/or a DCM, SEF, or Exempt SEF, if traded there); and
(5) The disclosure of information relating to material characteristics of a particular swap that are reflected in the transaction documentation for that swap would be duplicative.
In general, § 23.432 requires Swap Entities to provide notice to their non-Swap Entity counterparties that the counterparty has the right to elect to clear a swap executed with the Swap Entity (assuming the swap is eligible for clearing on a DCO) and has the right to choose the DCO on which the swap will be cleared, if eligible.
The Commission proposes to amend §§ 23.432(a) and (b) by making clear that the notice must be given prior to entering into a swap. The Commission further proposes to amend § 23.432 by adding a new subparagraph (c) that would disapply the notice requirements of subparagraphs (a) and (b) to ITBC Swaps executed on a DCM, SEF, or Exempt SEF and to all A-ITBC Swaps. As discussed above, this proposed amendment reflects the Commission's preliminary view that: (1) ITBC Swaps are only those where the counterparty has the present intention to clear the swap prior to execution and thus has no need to receive notice of a right to clear the swap or choose the clearinghouse; and (2) Swap Entities do not know the identity of their counterparties to A-ITBC Swaps prior to execution.
In general, § 23.434 requires SDs that recommend a swap or a swap trading strategy to a non-Swap Entity counterparty to have a reasonable basis to believe that such swap or swap trading strategy is suitable for the counterparty after engaging in reasonable diligence to ascertain the counterparty's investment strategy, trading objective, and ability to absorb potential losses.
However, § 23.434(b) provides a safe harbor, which, if complied with, deems the SD to have a reasonable basis to believe that the recommended swap or swap trading strategy is suitable for the counterparty.
The Commission proposes to amend § 23.434 to add a new subparagraph (d) that would provide an exception from the requirements of § 23.434 for A-ITBC Swaps and for ITBC Swaps executed by an SD with a non-Swap Entity on a DCM, SEF, or Exempt SEF. As stated above, the Commission has preliminarily determined that swaps listed for trading on a DCM, SEF, or Exempt SEF, and accepted for clearing on a DCO or Exempt DCO, are sufficiently standardized, and sufficient information about the pricing and material risks and characteristics of such swaps are available from the DCM, SEF, or Exempt SEF and/or the DCO or Exempt DCO. Because (i) this information is available to counterparties from sources other than an SD counterparty; (ii) ITBC Swap counterparties have no on-going relationship with an SD counterparty with respect to ITBC Swaps; and (iii) the Commission preliminarily believes that all or nearly all ITBC Swap counterparties have represented to any potential SD counterparty that they are capable of independently evaluating any recommendation from the SD, the Commission has preliminarily determined that ITBC Swap counterparties will likely look to SDs only for competitive pricing. Thus, the Commission preliminarily believes that requiring an SD to have a reasonable basis to believe that a recommended swap or swap trading strategy is suitable for its ITBC Swap counterparties is unnecessary where adequate information about the risks and characteristic of an ITBC Swap is available to the counterparty from sources other than the SD and the suitability analysis otherwise required is a hinderance to the efficient trading of ITBC Swaps for both the SD and its counterparty. Further, SDs that are counterparties to A-ITBC swaps do not know, and may never know, the identity of their counterparties, making a suitability analysis impossible.
The Commission considered but rejected the alternative of not proposing
In general, §§ 23.440 and 23.450 concern requirements that SDs must comply with when acting as advisors to, and Swap Entities must comply with when entering into swaps with, Special Entities.
Pursuant to §§ 23.440 and 23.450,
However, each of §§ 23.440 and 23.450 provides a safe harbor, which, if complied with, deems the SD to not be acting as an advisor to a Special Entity and/or have a reasonable basis to believe that the Special Entity has a QIR.
The Commission proposes to amend § 23.440 to add a new subparagraph (e), which would provide an exception from the requirements of § 23.440 in two circumstances. First, the proposed amendment would provide an exception from the requirements of § 23.440 for A-ITBC Swaps (
Section 4s(h)(4)(B) of the CEA provides that an SD that acts as an advisor to a Special Entity shall have a duty to act in the best interests of the Special Entity.
In applying this interpretation of the exception in section 4s(h)(7) of the CEA, the Commission incorporated a similar exception from certain External Business Conduct Standards for swaps initiated on a DCM or SEF where a Swap Entity does not know the identity of its counterparty prior to execution,
Thus, to further facilitate the trading of cleared swaps on DCMs, SEFs, and Exempt SEFs, in the context of ITBC Swaps initiated by a Special Entity on a DCM, SEF, or Exempt SEF, the Commission preliminarily interprets the condition in section 4s(h)(7) that the SD does not know the identity of the counterparty to be met not only where the SD is unaware of the name of the counterparty (
The Commission notes that the exception in 4s(h)(7) applies only to swaps “initiated by a Special Entity” on a DCM or SEF. This language is incorporated into the exception in the proposed amendment to § 23.440(e)(3) to better track the exception provided in the CEA, but the Commission has preliminarily determined that “initiated by” has no special meaning in this context and is synonymous with “entered into by” or “executed by.” The Commission understands that taking the active step of trading swaps on DCMs, SEFs, or Exempt SEFs may take many forms such as posting a request-for-quote, submitting a bid or offer to a central limit order book, or accepting a standing or resting bid or offer submitted by another market participant to a central limit order book. The Commission has preliminarily determined that limiting the proposed exception in proposed § 23.440(e)(3) to only a subset of the variety of available trading methodologies (
The Commission notes that where an SD knows the name of its counterparty, there may be situations where actual knowledge of the counterparty's status as a Special Entity could be reasonably inferred by the name of the counterparty alone. For example, a counterparty known to an SD as “City of New York” or “State of New York,” alone, without more information, should put an SD on notice that its counterparty is a governmental Special Entity. In such situations, the Commission is aware that the SD may have actual knowledge of both the counterparty's name and its status as a Special Entity (and therefore will be deemed to have actual knowledge of the counterparty's “identity” as that term is used in section 4s(h)(7) of the CEA) and, thus, the SD will not qualify for the exception in proposed § 23.440(e)(3). While the Commission is aware that this may limit the trading of ITBC Swaps by Special Entities with names that readily identify them as Special Entities, the Commission believes it is restrained by the language in section 4s(h) of the CEA from providing any further exceptions. As noted below, the Commission seeks comment from Special Entities and their current or potential SD counterparties on the effect of the limited exception the Commission has proposed.
With respect to Special Entities that are not readily identifiable as Special Entities from their name alone, in the Commission's preliminary view, an SD would only have actual knowledge of whether a counterparty is a Special Entity if it has entered into a trading relationship with such counterparty and has, for example, entered into documentation in compliance with the STRD Requirement.
The Commission also proposes to amend § 23.450 to add a new subparagraph (h) to § 23.450, which would provide an exception from the requirements of § 23.450 for A-ITBC Swaps (
The Commission preliminarily believes that the proposed amendments to §§ 23.440 and 23.450 better serve the intent of the CEA than the rules now in effect. As discussed above, the Commission has preliminarily determined that swaps listed for trading on a DCM, SEF, or Exempt SEF, and accepted for clearing on a DCO or Exempt DCO, are sufficiently standardized and information about the material risks and characteristics of such swaps are available from the DCM, SEF, or Exempt SEF and/or the DCO or Exempt DCO. Because (i) this information is available to counterparties from sources other than a Swap Entity counterparty, (ii) ITBC Swap counterparties have no on-going relationship with a Swap Entity counterparty with respect to ITBC Swaps, and (iii) the Commission preliminarily believes that all or nearly all ITBC Swap counterparties have represented to any Swap Entity counterparty that they will not rely on recommendations from a Swap Entity and/or that any such recommendation will be independently evaluated by a fiduciary or a QIR, the Commission has preliminarily determined that ITBC Swap counterparties will likely be entering into ITBC Swaps on DCMs, SEFs, or Exempt SEFs on their own initiative rather than looking to SDs for trading advice or disclosures and likely looking to SDs only for competitive pricing. Because information about the material risks and characteristics of ITBC Swaps is available to Special Entity counterparties from a source other than a Swap Entity, the Commission has also preliminarily determined that it is likely that there may be no material regulatory purpose served by requiring an SD to determine that a Special Entity counterparty has a QIR. Further, Swap Entities that are counterparties to A-ITBC swaps or ITBC Swaps with counterparties where the Swap Entity does not know the Special Entity status of the counterparty do not know, and may never know, the “identity” (as interpreted by the Commission as discussed above) of their counterparties, making a suitability analysis or determination that a Special Entity has a QIR impossible.
The Commission considered but rejected the alternative of not proposing any exception from the requirements of § 23.440 for ITBC Swaps, reasoning that there is no need for such exception if an SD simply refrains from recommending a swap or trading strategy involving a swap that is tailored to the particular needs or characteristics of a Special Entity that is an ITBC Swap counterparty. If an SD does not recommend a swap or swap trading strategy that is tailored to the particular needs of a Special Entity, then there is no need to comply with the requirement in § 23.440(c)(1) that the SD make a reasonable determination that any swap or trading strategy involving a swap recommended by the SD is in the best interests of the Special Entity. The Commission has preliminarily determined, however, that the tremendous uptake of adherence to the ISDA protocol discussed above is persuasive evidence that SDs are not willing to enter into swaps with Special Entities that have not made the representation necessary for an SD to rely on the safe-harbor in § 23.440(b). The Commission preliminarily understands that SDs are unwilling to take the risk that something communicated during swap negotiations will be seen as providing a recommendation despite the best efforts or policies and procedures of the SD designed to prevent sales and trading personnel from making any recommendation to Special Entity counterparties. The Commission also preliminarily understands that SDs often do not know whether a counterparty is a Special Entity even when the SD knows the identity of the counterparty prior to execution of a swap.
The Commission did not consider the alternative of not providing an exception from compliance with § 23.450 because the requirements of § 23.450 apply to a Swap Entity whenever it enters into a swap with a Special Entity. Thus, whenever a Swap Entity offers to enter into or enters into a swap with a counterparty that it knows is a Special Entity, the Swap Entity, absent the exception, would be required by § 23.450(b)(1) to have a reasonable basis to believe that the Special Entity has a QIR. The Commission has preliminarily determined that the burden of obtaining the information or representations necessary for a Swap Entity to establish that a Special Entity has a QIR would likely result in a significant decrease in the number of Swap Entities willing to enter into ITBC Swaps with Special Entities. As noted above, the Commission also preliminarily understands that Swap Entities often don't know whether an ITBC Swap counterparty is a Special Entity even when the Swap Entity knows the identity of the counterparty prior to execution.
As reflected in the proposed amended rule text
The term “statutory disqualification” means,
The foregoing proposed amendment to § 23.450(a)(2)
In general, § 23.451, subject to certain conditions and exceptions, prohibits SDs from entering into swaps with a governmental Special Entity (as defined in § 23.451(a)(3)) within two years after any political contribution to an official of such governmental Special Entity was made by the SD or a covered associate (as defined in § 23.451(a)(2)) of the SD.
The Commission proposes to amend § 23.451 by revising subparagraph (b)(2)(iii) to provide that the prohibition will not apply to: (1) swaps that are initiated on a DCM, SEF, or Exempt SEF; and (2) A-ITBC Swaps.
In proposing to include Commission regulation 23.451 in the ITBC Swap Compliance Exceptions for ITBC Swaps executed on a DCM, SEF, or Exempt SEF where the SD knows the identity of the counterparty, the Commission has preliminarily determined that the risk of political contributions inappropriately influencing governmental Special Entities' swaps trading decisions are substantially mitigated by the nature of trading on a DCM, SEF, or Exempt SEF. Such facilities, by definition, provide access to liquidity from multiple liquidity providers, not a single SD.
In addition, the Commission understands from market participants that MPD's observations in CFTC Staff Letter 23-01 regarding “no-trade” lists and other internal requirements designed to prevent or mitigate violations of Commission regulation 23.451 are not implemented as simply as MPD may have surmised in the context of trading on DCMs, SEFs, or Exempt SEFs. The Commission is aware that staff guidance has, since 2013, discouraged SEFs from permitting “enablement mechanisms” such as those that, according to market participants, would allow an SD to enforce a “no-trade” list when trading on a SEF.
The proposed amendment to § 23.451 to exclude A-ITBC Swaps is intended to ensure that all swaps executed anonymously, including those not initiated, on a DCM, SEF, or Exempt SEF, will not be subject to § 23.451. The Commission has preliminarily determined that it is not possible for an SD to comply with § 23.451 where an SD does not know the identity of the counterparty prior to execution, regardless of whether the swap is executed bilaterally or on or pursuant to the rules of a DCM, SEF, or Exempt SEF.
The Commission is also proposing to delete the word “Federal” from § 23.451(a)(1)(iii)
In general, § 23.504 requires Swap Entities to enter into swap trading relationship documentation covering certain enumerated topics with each swap counterparty prior to entering into a swap with such counterparty
The revised section would read as follows: (1) Applicability. The requirements of this section shall not apply to: (i) swaps executed prior to the date on which a swap dealer or major swap participant is required to be in compliance with this section; (ii) swaps that have been cleared on a derivatives clearing organization or cleared on a clearing organization that is currently exempted from registration by the Commission pursuant to section 5b(h) of the Act; and (iii) an ITBC Swap as defined in § 23.401(d) of this chapter.
These proposed changes recognize that the clearing of swaps between a Swap Entity and a counterparty involves two stages: (1) the execution of a swap between a Swap Entity and its counterparty; and (2) the novation of that swap to a clearing organization that results in two swaps: (i) a swap between the clearing organization and the Swap Entity; and (ii) a swap between the clearing organization and its counterparty. The proposed changes to the applicability of the STRD Requirement in § 23.504(a)(1) therefore recognize that the STRD Requirement should not apply to an ITBC Swap as defined in § 23.401(d),
As discussed above, section 4s(h) of the CEA
Section 15(a) of the CEA requires the Commission to “consider the costs and benefits” of its actions before promulgating a regulation under the CEA or issuing certain orders.
The Commission notes that this cost-benefit consideration is based on its understanding that the derivatives market regulated by the Commission functions internationally with: (1) transactions that involve U.S. entities occurring across different international jurisdictions; (2) some entities organized outside of the United States that are registered with the Commission; and (3) some entities that typically operate both within and outside the United States and that follow substantially similar business practices wherever located. Where the Commission does not specifically refer to matters of location, the discussion of costs and benefits below refers to the effects of the proposed regulations on all relevant derivatives activity, whether based on their actual occurrence in the United States or on their connection with, or effect on U.S. commerce.
The baseline for the Commission's consideration of the costs and benefits of the Proposal are: (1) the Commission's rules governing business conduct standards for Swap Entities in the dealings with counterparties, adopted by the Commission as subpart H of part 23 of its regulations (§§ 23.400-23.451) pursuant to rulemaking authority granted under section 4s(h) of the CEA (the “External Business Conduct Standards”);
Compliance with the conditions set forth in the definition of ITBC Swap in proposed § 23.401
Compliance with the conditions set forth in the definition of ITBC Swap in proposed § 23.401 would also benefit SDs by permitting SDs to qualify for exceptions to compliance with regulatory requirements that would otherwise require the SD to obtain information and representations from
If the Commission determines to eliminate the PTMMM disclosure requirement, as proposed above, SDs would benefit from a reduction in costs that would otherwise be incurred in preparing and disclosing the PTMMM. Not being required to source mid-market prices for certain swaps solely for disclosure of a PTMMM to non-Swap Entity counterparties may cause a cost savings for SDs.
Further, the Commission notes that, as a result of the no-action positions provided by MPD in CFTC Staff Letter 23-01 pertaining to ITBC Swaps, CFTC Staff Letter 13-12 pertaining to certain foreign exchange transactions (
Similarly, the Commission notes that as a result of the no-action position provided by MPD in CFTC Staff Letter 23-01 pertaining to ITBC Swaps, scenario analysis is probably not being provided by some SDs to some cleared swaps counterparties and, therefore, elimination of the Scenario Analysis Requirement may not be significant to the costs of or benefits to such SDs or their counterparties.
Finally, compliance with the ITBC Swap conditions would benefit some SDs and their counterparties by providing an exception to the expensive and time-consuming process of negotiating and executing swap trading relationship documentation under the STRD Requirement in cases where the documentation is unnecessary because the subject swaps will either be cleared or void
Compliance with the conditions set forth in the proposed definition of a Qualified Prime Broker Arrangement in proposed § 23.401
Regarding the other miscellaneous proposed amendments, the proposed amendment to the daily mark disclosure requirement in § 23.431 may benefit SDs by harmonizing the calculation of the daily mark with the calculation of valuation data for SDR reporting and the calculation of variation margin, thereby reducing SDs' operational burdens. The proposed amendment of the definition of “statutory disqualification” in § 23.450 would benefit those persons not automatically barred from being a QIR and may benefit certain Special Entities if they are not required to find a new QIR in the event their existing QIR is subject to a regulatory action that would have previously constituted a statutory disqualification. Finally, certain Swap Entities may benefit from the proposed amendment to § 23.451 that would remove “Federal” from the definition of “contributions” under the rule, thereby not prohibiting the Swap Entity from entering into swaps with Federal governmental Special Entities if the Swap Entity makes a contribution to the transition or inaugural expenses of a successful candidate for Federal public office.
As compared to the baseline of full compliance with the External Business Conduct Standards and the STRD Requirement, compliance with the conditions set forth in the proposed definition of ITBC Swap in § 23.401 may entail the following costs:
1. Costs incurred by an SD and its ITBC Swap counterparty in determining whether counterparties are eligible to clear an ITBC Swap on a particular DCO or Exempt DCO, likely would require a written inquiry and receipt of a written response and attendant recordkeeping processes or entry of response in trading systems;
2. Costs incurred by an SD and its ITBC Swap counterparty in ensuring that swaps are submitted to clearing on a DCO or Exempt DCO as quickly after execution as would be technologically practicable if fully automated systems were used, likely would require on-boarding to DCO and/or Exempt DCO swap submission systems, or to their respective client clearing service providers, with attendant applications and other paperwork as well as recordkeeping processes; and
3. Costs incurred by SDs and their ITBC Swap counterparties in adjusting execution documentation to ensure agreement that swaps not executed on a DCM, SEF, or Exempt SEF that fail to clear would be deemed by the SD and its counterparty to be void
The Commission notes that many, if not all, of the foregoing costs may have already been incurred by SDs to meet the conditions to the MPD no-action position in CFTC Staff Letter 23-01, though the Commission acknowledges that at least some additional costs would likely be incurred by SDs and their ITBC Swap counterparties due to minor variations between the Proposal and the conditions set forth in CFTC Staff Letter 23-01.
As compared to the baseline of full compliance with the External Business Conduct Standards, compliance with the conditions set forth in the proposed definition of Qualified Prime Broker Arrangement in proposed § 23.401 may entail costs incurred by PB/SDs and their new PB Counterparties to negotiate and enter into Prime Broker Arrangements, and costs incurred by PB/SDs and their existing PB Counterparties to negotiate and amend existing Prime Broker Arrangements, that meet the conditions of the definition of Qualified Prime Broker Arrangement, including:
1. Costs incurred to ensure that the parties have agreed on the type, parameters, and limits of each potential
2. Costs incurred in producing and maintaining records of all Regulatory Disclosures necessary to comply with the § 23.431(a) and (b),
3. Costs incurred in producing, delivering, and maintaining the required acknowledgement from PB Counterparties regarding receipt of the Regulatory Disclosures and the disapplication of the requirement that PB/SDs provide any further disclosures; and
4. Costs incurred for recordkeeping processes to maintain records of each Qualified Prime Broker Arrangement.
The Commission requests additional public comment regarding potential costs of the Proposal.
The Commission considered several alternatives to the Proposal. On one hand, the Commission, for analytical completeness, considered terminating the no-action positions in the Covered Staff Letters or allowing them to expire. When compared only to the existing External Business Conduct Standards and STRD Requirement, which is the baseline for the cost and benefit considerations, this alternative imposes neither costs nor benefits because this approach would effectively constitute a reversion to the Commissions regulations prior to issuance of the Covered Staff Letters. However, the Commission does not anticipate that there would be any significant benefit to this approach relative to the approach contemplated by the Proposal, and indeed, preliminarily believes that there would be significant costs to market participants when compared to the Proposal, particularly in consideration of market participants' probable reliance on the no-action letters, which the Proposal would have the effect of codifying, with the modifications described herein. Terminating or allowing the no-action positions to expire without amending the regulations as discussed herein would, as noted above, preclude swap market participants from achieving or maintaining significant benefits and would likely require incursion of significant costs to unwind trading relationships and Prime Broker Arrangements entered into in reliance on the no-action positions or enter into new documentation and trading relationships, or implement new counterparty vetting procedures to ensure compliance with the External Business Conduct Standards and STRD Requirement.
Alternatively, the Commission considered, in the ITBC Swaps context, limiting the ITBC Swap Compliance Exceptions only to those swaps executed anonymously on a DCM, SEF, or Exempt SEF and cleared on a DCO or Exempt DCO. The Commission considered this as a less complex alternative to the Proposal, relying on the “straight-through-processing” rules applicable to Swap Entities, SEFs, and DCOs
Similarly, the Commission considered, in the Prime Broker context, whether eliminating the compliance exceptions for swaps executed under a Qualified Prime Broker Arrangement as set forth in the Proposal would incentivize SDs and their prime brokerage customers to seek clearing of swaps and Exempt FX Transactions as an alternative to the credit intermediation and other services provided by PBs. However, as noted above, the Commission preliminarily believes that the swaps market has already made strides in this direction and has determined that interference at this stage would require significant time and effort and may prove more disruptive than to allow the clearing of swaps to develop at its own pace.
Because the Commission is not aware of any adverse consequences resulting from the no-action positions in the Covered Staff Letters that have been in place for as long as a decade or more, the Commission preliminarily believes that the proposed amendments, which would have the effect of codifying the no-action positions with certain revisions, would be the most appropriate and beneficial approach for Swap Entities and their counterparties.
Section 15(a) of the CEA
Section 15(a)(2)(A) of the CEA requires the Commission to evaluate the costs and benefits of a proposed regulation in light of considerations of protection of market participants and the public.
In general, the External Business Conduct Standards were adopted by the Commission as directed by the Dodd-Frank Act to increase protections for counterparties to Swap Entities by requiring additional disclosures about the material risks and characteristics of swaps and the material incentives and conflicts of interest that a Swap Entity may have to recommend or enter into swaps with such counterparties. One goal of the External Business Conduct Standards was to attempt to balance the historical asymmetry of information about swaps and the swap markets that had existed prior to the Dodd-Frank Act, leaving counterparties much less informed about the material risks and characteristics of swaps and the pricing of swaps, and the compensation being earned by Swap Entities when entering into swaps. The Proposal would provide regulatory compliance exceptions from
In the context of Prime Broker Arrangements, the price (and, if required by a final rule, the PTMMM)
In the context of ITBC Swaps, many more disclosure requirements and relationship-based requirements are proposed to be disapplied when Swap Entities enter into ITBC Swaps with non-Swap Entity counterparties. However, the Commission preliminarily believes that the disapplication of these regulatory requirements subject to the conditions provided for in the Proposal is reasonable when considered in light of the Commission's regulatory interest in promoting the trading of swaps on trading facilities and the clearing of swaps generally, two of the pillars of the reforms Congress intended be implemented for the swap markets by enactment of the Dodd-Frank Act. The Commission's purpose in disapplying the disclosure and trading relationship requirements in the context of ITBC Swaps as set forth in the Proposal
The elimination of the scenario analysis requirement in § 23.431(b) could also reduce the transparency of swaps transactions to swap counterparties. However, those analyses are only required when requested by a counterparty to the Swap Entity, and the Commission understands that they are requested rarely, if at all, due to their limited value.
For the foregoing reasons, the Commission preliminarily believes that the Proposal will not have a material detrimental effect on the protection of swap market participants or the public.
Section 15(a)(2)(B) of the CEA requires the Commission to evaluate the costs and benefits of a proposed regulation in light of “efficiency, competitiveness, and financial integrity of futures markets.”
Section 15(a)(2)(C) of the CEA requires the Commission to evaluate the costs and benefits of a proposed regulation in light of price discovery considerations.
Section 15(a)(2)(D) of the CEA requires the Commission to evaluate the costs and benefits of a proposed regulation in light of sound risk management practices.
However, to the extent that the Proposal promotes trading on DCMs, SEFs, and Exempt SEFs and clearing through a DCO or Exempt DCO, the Commission preliminarily believes that the Proposal may further sound risk management practices. The trades executed on DCMs, SEFs, and Exempt SEFs are subject to the rules of these entities' platforms and receive the associated protections. Also, the trades cleared on a DCO or Exempt DCO are subject to the rules of these entities, which helps to ensure market participants adequately address credit risks.
Section 15(a)(2)(E) of the CEA requires the Commission to evaluate the costs and benefits of a proposed regulation in light of other public interest considerations.
Section 15(b) of the CEA requires the Commission to take into consideration the public interest to be protected by the antitrust laws and endeavor to take the least anticompetitive means of achieving the purposes of the CEA in issuing any order or adopting any Commission rule or regulation.
The Commission believes that the public interest to be protected by the antitrust laws is generally to protect competition. The Commission requests comment on whether the Proposal implicates any other specific public interest to be protected by the antitrust laws.
The Commission has considered the Proposal to determine whether it is anticompetitive and has preliminarily identified no anticompetitive effects. The Commission requests comment on whether the Proposal is anticompetitive and, if it is, what the anticompetitive effects are.
Because the Commission has preliminarily determined that the Proposal is not anticompetitive and has no anticompetitive effects, the Commission has not identified any less anticompetitive means of achieving the purposes of the CEA. The Commission requests comment on whether there are less anticompetitive means of achieving the relevant purposes of the CEA that would otherwise be served by adopting the Proposal.
The Regulatory Flexibility Act (“RFA”) requires Federal agencies to consider whether the rules they propose will have a significant economic impact on a substantial number of small entities and, if so, to provide a regulatory flexibility analysis reflecting the impact.
Accordingly, the Chairman, on behalf of the Commission, hereby certifies pursuant to 5 U.S.C. 605(b) that the proposed amendments will not have a significant economic impact on a substantial number of small entities.
The Paperwork Reduction Act (“PRA”)
This proposed rulemaking affects regulations that contain collections of information within the meaning of the PRA, as discussed below.
As discussed above, the proposed revisions to § 23.431
The Commission estimates that eliminating the requirement to provide a PTMMM will decrease Swap Entities' burden hours incurred for each swap transaction by 10% on average. The Commission understands that, in certain rare cases (
Further, the Commission estimates that eliminating the Scenario Analysis Requirement as proposed will decrease Swap Entities' burden hours incurred for each swap transaction by 5% on average across all Swap Entities. Although preparing a scenario analysis for a particular swap may take a substantial amount of time, the Commission understands that such analyses are rarely, if ever, requested as many counterparties have not found them to be useful in considering entering into a swap (or, in the alternative, Swap Entities are unwilling to do business with a counterparty that requires a scenario analysis due to the cost of providing such analysis).
The Proposal would also: (i) expand the exceptions in § 23.431(c)
The Commission believes that the other changes that the Proposal would make to § 23.431
The proposed amendments to §§ 23.402, 430, 432, 434, 440, 450, and 451
In consideration of the above and the current number of Swap Entities, the Commission estimates that the total overall burdens for OMB Control Number 3038-0079 will be approximately as follows:
There are no capital costs or operating and maintenance costs associated with this collection.
Similar to the regulations discussed above, the Proposal would modify § 23.504
Although the adoption of these changes may result in lesser burdens for market participants subject to § 23.504, in an effort to be conservative in
The Commission invites the public and other Federal agencies to comment on any aspect of the proposed information collection requirements discussed above. The Commission will consider public comments on the proposed collections of information in: (1) evaluating whether the proposed collections of information are necessary for the proper performance of the functions of the Commission, including whether the information will have a practical use; (2) evaluating the accuracy of the estimated burdens of the proposed collections of information, including the degree to which the methodology and the assumptions that the Commission employed were valid; (3) enhancing the quality, utility, and clarity of the information proposed to be collected; and (4) minimizing the burden of the proposed information collection requirements on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological information collection techniques,
Copies of the submission from the Commission to OMB are available from the CFTC Clearance Officer, 1155 21st Street NW, Washington, DC 20581, 202-418-5714 or from
• The Office of Information and Regulatory Affairs, Office of Management and Budget, Room 10235, New Executive Office Building, Washington, DC 20503, Attn: Desk Officer of the Commodity Futures Trading Commission;
• 202-395-6566 (fax); or
•
Please provide the Commission with a copy of submitted comments so that all comments can be summarized and addressed in the final rulemaking, and please refer to the
Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select those regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; and distributive impacts). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as any regulatory action that is likely to result in a rule that may: (1) have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, or the President's priorities.
The Office of Management and Budget has determined that this action is not a significant regulatory action as defined in Executive Order 12866, as amended, and therefore it was not subject to Executive Order 12866 review.
This Proposal, if finalized as proposed, is not expected to be an Executive Order 14192 regulatory action, because the proposed rule is not a significant regulatory action under E.O. 12866.
Reporting and recordkeeping requirements, Swaps, Trading records.
For the reasons stated in the preamble, the Commodity Futures Trading Commission proposes to amend 17 CFR part 23 as follows:
7 U.S.C. 1a, 2, 6, 6a, 6b, 6b-1, 6c, 6p, 6r, 6s, 6t, 9, 9a, 12, 12a, 13b, 13c, 16a, 18, 19, 21.
Section 23.160 also issued under 7 U.S.C. 2(i); Sec. 721(b), Pub. L. 111-203, 124 Stat. 1641 (2010).
The sections of this subpart shall apply to swap dealers and, unless otherwise indicated, major swap participants. These rules are not intended to limit or restrict the applicability of other provisions of the Act and rules and regulations thereunder, or other applicable laws, rules and regulations. The provisions of
Solely for purposes of this subpart, the terms listed in this section have the meanings set forth below.
(a)
(b)
(c)
(d)
(1) At least one of the parties to the swap is a swap entity;
(2) The swap is of a type accepted for clearing by a derivatives clearing organization registered with the Commission (“DCO”) or a clearing organization that is currently exempted from registration by the Commission pursuant to section 5b(h) of the Act (“Exempt DCO”);
(3) The swap is intended by the parties to be cleared contemporaneously with execution;
(4) If the swap is intended to be cleared on a DCO, the swap entity and its counterparty are either clearing members of the DCO to which the swap will be submitted, or have entered into an agreement with a clearing member of such DCO for clearing of swaps of the same type as the swap intended to be cleared;
(5) If the swap is intended to be cleared on an Exempt DCO, the swap entity and its counterparty must be eligible to clear the swap on the Exempt DCO pursuant to the terms and conditions of the Order of Exemption from Registration issued by the Commission regarding such Exempt DCO;
(6) The swap entity does not require its counterparty or its clearing member (if any) to enter into a breakage agreement or similar agreement as a condition to executing the swap;
(7) If the swap is not executed on or pursuant to the rules of a designated contract market (“DCM”), swap execution facility (“SEF”), or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act (“Exempt SEF”), the swap entity ensures that both parties submit the swap for clearing to a DCO or Exempt DCO as quickly after execution as would be technologically practicable if fully automated systems were used;
(8) If the swap is executed on or pursuant to the rules of a DCM, SEF, or Exempt SEF, the rules of the DCM, SEF, or Exempt SEF provide that if the swap is rejected from clearing, such swap is deemed to be void
(e)
(f)
(1) A Covered Transaction (the “Trigger Transaction”) for which the Prime Broker has not determined the price with a counterparty (the “Trigger CP”); and
(2) A second Covered Transaction with another counterparty that is not the Trigger CP, which transaction, from the perspective of the Prime Broker, is subject to substantially equal but opposite terms and conditions to the Trigger Transaction.
(g)
(1) The Prime Broker (as defined under the definition of Prime Broker Arrangement) and a counterparty that is not a swap entity that has entered into a Prime Broker Arrangement with the Prime Broker (the “PB Counterparty”) have agreed in writing on the type, parameters, and limits of each potential Covered Transaction that may be entered into by the PB Counterparty with the Prime Broker pursuant to such Prime Broker Arrangement (each, a “Permitted PB Transaction”);
(2) The PB Counterparty has received from the Prime Broker all disclosures regarding the Permitted PB Transactions that, to the best of the Prime Broker's knowledge and reasonable belief, would be necessary for the Prime Broker to comply with § 23.431(a), other than the pre-trade disclosure of the price of the Permitted PB Transaction (the “Regulatory Disclosures”);
(3) The Prime Broker has received an acknowledgement from the PB Counterparty that:
(i) The PB Counterparty has received the Regulatory Disclosures;
(ii) The Prime Broker has clarified or supplemented the Regulatory Disclosures as requested by the PB Counterparty in its sole discretion; and
(iii) The Prime Broker has no obligation to provide additional disclosures pursuant to section 4s(h)(3)(B)(i) of the Act or § 23.431(a) with respect to the Permitted PB Transaction to the PB Counterparty, unless requested by the PB Counterparty in writing prior to execution; and
(4) The Prime Broker maintains a record of the Prime Broker Arrangement and the required acknowledgement received from the PB Counterparty until the expiration or termination of all Permitted PB Transactions executed pursuant thereto and for a period of five (5) years thereafter in accordance with § 23.203.
(h)
(1) A Federal agency;
(2) A State, State agency, city, county, municipality, other political subdivision of a State, or any instrumentality, department, or a corporation of or
(3) Any employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002);
(4) Any governmental plan, as defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002);
(5) Any endowment, including an endowment that is an organization described in section 501(c)(3) of the Internal Revenue Code of 1986 (26 U.S.C. 501(c)(3)); or
(6) Any employee benefit plan defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002), not otherwise defined as a Special Entity, that elects to be a Special Entity by notifying a swap entity of its election prior to entering into a swap with the particular swap entity.
(i)
(j)
(a)
(i) Ensure compliance with the requirements of this subpart; and
(ii) Prevent a swap entity from evading or participating in or facilitating an evasion of any provision of the Act or any regulation promulgated thereunder.
(2) Swap entities shall implement and monitor compliance with such policies and procedures as part of their supervision and risk management requirements specified in subpart J of this part.
(b)
(1) Facts required to comply with applicable laws, regulations and rules;
(2) Facts required to implement the swap dealer's credit and operational risk management policies in connection with transactions entered into with such counterparty; and
(3) Information regarding the authority of any person acting for such counterparty.
(c)
(d)
(e)
(f)
(g)
(h)
(a)
(1) To employ any device, scheme, or artifice to defraud any Special Entity or prospective customer who is a Special Entity;
(2) To engage in any transaction, practice, or course of business that operates as a fraud or deceit on any Special Entity or prospective customer who is a Special Entity; or
(3) To engage in any act, practice, or course of business that is fraudulent, deceptive, or manipulative.
(b)
(1) Did not act intentionally or recklessly in connection with such alleged violation; and
(2) Complied in good faith with written policies and procedures reasonably designed to meet the particular requirement that is the basis for the alleged violation.
(c)
(i) Disclose to any other person any material confidential information provided by or on behalf of a counterparty to the swap entity; or
(ii) Use for its own purposes in any way that would tend to be materially adverse to the interests of a counterparty, any material confidential information provided by or on behalf of a counterparty to the swap entity.
(2) Notwithstanding paragraph (c)(1) of this section, a swap entity may disclose or use material confidential information provided by or on behalf of a counterparty to the swap entity if such disclosure or use is authorized in writing by the counterparty, or is necessary:
(i) For the effective execution of any swap for or with the counterparty;
(ii) To hedge or mitigate any exposure created by such swap; or
(iii) To comply with a request of the Commission, Department of Justice, any self-regulatory organization designated by the Commission, or an applicable prudential regulator, or is otherwise required by law.
(3) Each swap entity shall implement written policies and procedures reasonably designed to protect material confidential information provided by or on behalf of a counterparty from
(a)
(b)
(c)
(d)
(e)
(1) Initiated on a designated contract market;
(2) Initiated with a counterparty whose identity is not known to the swap entity prior to execution on a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act;
(3) An A-ITBC Swap; or
(4) An ITBC Swap initiated on a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act.
(a)
(1) The material risks of the particular swap, which may include market, credit, liquidity, foreign currency, legal, operational, and any other applicable risks;
(2) The material characteristics of the particular swap, which shall include the price of the swap, the material economic terms of the swap, the terms relating to the operation of the swap, and the rights and obligations of the parties during the term of the swap to the extent that such characteristics are not reflected in transaction documentation with which the counterparty has been provided prior to entering into the swap; and
(3) The material incentives and conflicts of interest that the swap entity may have in connection with a particular swap, which shall include any compensation or other incentive from any source other than the counterparty that the swap entity may receive in connection with the swap.
(b) [Reserved]
(c)
(1) Initiated on a designated contract market;
(2) Initiated with a counterparty whose identity is not known to the swap entity prior to execution on a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act;
(3) An A-ITBC Swap;
(4) An ITBC Swap initiated on a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act; or
(5) A Permitted PB Transaction entered into pursuant to a Qualified Prime Broker Arrangement.
(d)
(1) Notify each counterparty (other than a swap entity, security-based swap dealer, or major security-based swap participant) of the counterparty's right to receive, upon request, the daily mark for each cleared swap from the appropriate derivatives clearing organization.
(2) Paragraph (d)(1) of this section shall not apply with respect to a transaction that is:
(i) An ITBC Swap that is initiated on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act or;
(ii) An A-ITBC Swap.
(3) For uncleared swaps, provide the counterparty (other than a swap entity, security-based swap dealer, or major security-based swap participant) with a daily mark, which shall be the estimated price that would be received by the counterparty to sell (expressed as a positive number), or be paid by the counterparty to transfer (expressed as a negative number), the uncleared swap in the market in an orderly transaction, calculated in accordance with the methodology agreed in the documentation required by § 23.504, or if applicable, § 23.158. The daily mark shall be provided to the counterparty during the term of the swap as of the close of business or such other time as the parties agree in writing.
(4) For uncleared swaps, disclose to the counterparty:
(i) The methodology and assumptions used to prepare the daily mark and any material changes during the term of the swap; provided however, that the swap entity is not required to disclose to the counterparty confidential, proprietary information about any model it may use to prepare the daily mark; and
(ii) Additional information concerning the daily mark to ensure a fair and balanced communication, including, as appropriate, that:
(A) The daily mark is an estimate and may not necessarily be a price at which either the counterparty or the swap entity would agree to replace or terminate the swap;
(B) Depending upon the agreement of the parties, calls for margin may be based on considerations other than the estimated daily mark provided to the counterparty; and
(C) The daily mark is an estimate and may not necessarily be the value of the swap that is marked on the books of the swap entity.
(a)
(b)
(1) May elect to require clearing of the swap; and
(2) Shall have the sole right to select the derivatives clearing organization at which the swap will be cleared.
(c)
(1) An ITBC Swap that is initiated on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act; or
(2) An A-ITBC Swap.
With respect to any communication between a swap entity and any counterparty, the swap entity shall communicate in a fair and balanced manner based on principles of fair dealing and good faith.
(a)
(1) Undertake reasonable diligence to understand the potential risks and rewards associated with the recommended swap or trading strategy involving a swap; and
(2) Have a reasonable basis to believe that the recommended swap or trading strategy involving a swap is suitable for the counterparty. To establish a reasonable basis for a recommendation, a swap dealer must have or obtain information about the counterparty, including the counterparty's investment profile, trading objectives, and ability to absorb potential losses associated with the recommended swap or trading strategy involving a swap.
(b)
(1) The swap dealer reasonably determines that the counterparty, or an agent to which the counterparty has delegated decision-making authority, is capable of independently evaluating investment risks with regard to the relevant swap or trading strategy involving a swap;
(2) The counterparty or its agent represents in writing that it is exercising independent judgment in evaluating the recommendations of the swap dealer with regard to the relevant swap or trading strategy involving a swap;
(3) The swap dealer discloses in writing that it is acting in its capacity as a counterparty and is not undertaking to assess the suitability of the swap or trading strategy involving a swap for the counterparty; and
(4) In the case of a counterparty that is a Special Entity, the swap dealer complies with § 23.440 where the recommendation would cause the swap dealer to act as an advisor to a Special Entity within the meaning of § 23.440(a).
(c)
(1) In the case of a counterparty that is not a Special Entity, the counterparty has complied in good faith with written policies and procedures that are reasonably designed to ensure that the persons responsible for evaluating the recommendation and making trading decisions on behalf of the counterparty are capable of doing so; or
(2) In the case of a counterparty that is a Special Entity, satisfy the terms of the safe harbor in § 23.450(d).
(d)
(1) An A-ITBC Swap; or
(2) An ITBC Swap initiated on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act.
(a)
(b)
(1) With respect to a Special Entity that is an employee benefit plan as defined in § 23.401(c)(3):
(i) The Special Entity represents in writing that it has a fiduciary as defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002) that is responsible for representing the Special Entity in connection with the swap transaction;
(ii) The fiduciary represents in writing that it will not rely on recommendations provided by the swap dealer; and
(iii) The Special Entity represents in writing:
(A) That it will comply in good faith with written policies and procedures reasonably designed to ensure that any recommendation the Special Entity receives from the swap dealer materially affecting a swap transaction is evaluated by a fiduciary before the transaction occurs; or
(B) That any recommendation the Special Entity receives from the swap dealer materially affecting a swap transaction will be evaluated by a fiduciary before that transaction occurs; or
(2) With respect to any Special Entity:
(i) The swap dealer does not express an opinion as to whether the Special Entity should enter into a recommended swap or trading strategy involving a swap that is tailored to the particular needs or characteristics of the Special Entity;
(ii) The Special Entity represents in writing that:
(A) The Special Entity will not rely on recommendations provided by the swap dealer; and
(B) The Special Entity will rely on advice from a qualified independent representative within the meaning of § 23.450; and
(iii) The swap dealer discloses to the Special Entity that it is not undertaking to act in the best interests of the Special Entity as otherwise required by this section.
(c)
(1)
(2)
(i) The financial status of the Special Entity, as well as the Special Entity's future funding needs;
(ii) The tax status of the Special Entity;
(iii) The hedging, investment, financing, or other objectives of the Special Entity;
(iv) The experience of the Special Entity with respect to entering into swaps, generally, and swaps of the type and complexity being recommended;
(v) Whether the Special Entity has the financial capability to withstand changes in market conditions during the term of the swap; and
(vi) Such other information as is relevant to the particular facts and circumstances of the Special Entity, market conditions, and the type of swap or trading strategy involving a swap being recommended.
(d)
(e)
(1) Initiated with a counterparty whose identity is not known to the swap dealer prior to execution on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act;
(2) An A-ITBC Swap; or
(3) An ITBC Swap initiated by a Special Entity on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act, in each case with a swap dealer who does not know the Special Entity status of its counterparty prior to execution.
(a)
(1) The term “principal relationship” means where a swap entity is a principal of the representative of a Special Entity or the representative of a Special Entity is a principal of the swap entity. The term “principal” means any person listed in § 3.1(a)(1) through (3) of this chapter.
(2) The term “statutory disqualification” means, with respect to a person that is not a registrant with the Commission, grounds for refusal to register or to revoke, condition, or restrict the registration of any registrant or applicant for registration as set forth in sections 8a(2) and 8a(3) of the Act, or, with respect to a person that is a registrant with the Commission, the Commission has refused registration or revoked, conditioned, or restricted the registration of such registrant or applicant for registration pursuant to sections 8a(2) or 8a(3) of the Act.
(b)
(i) Has sufficient knowledge to evaluate the transaction and risks;
(ii) Is not subject to a statutory disqualification;
(iii) Is independent of the swap entity;
(iv) Undertakes a duty to act in the best interests of the Special Entity it represents;
(v) Makes appropriate and timely disclosures to the Special Entity;
(vi) Evaluates, consistent with any guidelines provided by the Special Entity, fair pricing and the appropriateness of the swap; and
(vii) In the case of a Special Entity, as defined in § 23.401(c)(2) or (4), is subject to restrictions on certain political contributions imposed by the Commission, the Securities and Exchange Commission, or a self-regulatory organization subject to the jurisdiction of the Commission or the Securities and Exchange Commission; provided however, that this paragraph (b)(1)(vii) shall not apply if the representative is an employee of the Special Entity.
(2) Any swap entity that offers to enter or enters into a swap with a Special Entity as defined in § 23.401(c)(3) shall have a reasonable basis to believe that the Special Entity has a representative that is a fiduciary as defined in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002).
(c)
(1) The representative is not and, within one year of representing the Special Entity in connection with the swap, was not an associated person of the swap entity within the meaning of section 1a(4) of the Act;
(2) There is no principal relationship between the representative of the Special Entity and the swap entity;
(3) The representative:
(i) Provides timely and effective disclosures to the Special Entity of all material conflicts of interest that could reasonably affect the judgment or decision making of the representative with respect to its obligations to the Special Entity; and
(ii) Complies with policies and procedures reasonably designed to manage and mitigate such material conflicts of interest;
(4) The representative is not directly or indirectly, through one or more persons, controlled by, in control of, or under common control with the swap entity; and
(5) The swap entity did not refer, recommend, or introduce the representative to the Special Entity within one year of the representative's representation of the Special Entity in connection with the swap.
(d)
(i) The Special Entity represents in writing to the swap entity that it has complied in good faith with written policies and procedures reasonably designed to ensure that it has selected a representative that satisfies the applicable requirements of paragraph (b) of this section, and that such policies and procedures provide for ongoing monitoring of the performance of such representative consistent with the requirements of paragraph (b) of this section; and
(ii) The representative represents in writing to the Special Entity and swap entity that the representative:
(A) Has policies and procedures reasonably designed to ensure that it satisfies the applicable requirements of paragraph (b) of this section;
(B) Meets the independence test in paragraph (c) of this section; and
(C) Is legally obligated to comply with the applicable requirements of paragraph (b) of this section by agreement, condition of employment, law, rule, regulation, or other enforceable duty.
(2) A swap entity shall be deemed to have a reasonable basis to believe that a Special Entity defined in § 23.401(c)(3) has a representative that satisfies the applicable requirements in paragraph
(e)
(f)
(g)
(1) The capacity in which it is acting in connection with the swap; and
(2) If the swap entity engages in business with the Special Entity in more than one capacity, the swap entity shall disclose the material differences between such capacities.
(h)
(1) Initiated with a counterparty whose identity is not known to the swap entity prior to execution on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act;
(2) An A-ITBC Swap; or
(3) An ITBC Swap initiated on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act.
(a)
(1) The term “contribution” means any gift, subscription, loan, advance, or deposit of money or anything of value made:
(i) For the purpose of influencing any election for federal, state, or local office;
(ii) For payment of debt incurred in connection with any such election; or
(iii) For transition or inaugural expenses incurred by the successful candidate for state or local office.
(2) The term “covered associate” means:
(i) Any general partner, managing member, or executive officer, or other person with a similar status or function;
(ii) Any employee who solicits a governmental Special Entity for the swap dealer and any person who supervises, directly or indirectly, such employee; and
(iii) Any political action committee controlled by the swap dealer or by any person described in paragraphs (a)(2)(i) and (a)(2)(ii) of this section.
(3) The term “governmental Special Entity” means any Special Entity defined in § 23.401(c)(2) or (4).
(4) The term “official” of a governmental Special Entity means any person (including any election committee for such person) who was, at the time of the contribution, an incumbent, candidate, or successful candidate for elective office of a governmental Special Entity, if the office:
(i) Is directly or indirectly responsible for, or can influence the outcome of, the selection of a swap dealer by a governmental Special Entity; or
(ii) Has authority to appoint any person who is directly or indirectly responsible for, or can influence the outcome of, the selection of a swap dealer by a governmental Special Entity.
(5) The term “payment” means any gift, subscription, loan, advance, or deposit of money or anything of value.
(6) The term “regulated person” means:
(i) A person that is subject to restrictions on certain political contributions imposed by the Commission, the Securities and Exchange Commission, or a self-regulatory agency subject to the jurisdiction of the Commission or the Securities and Exchange Commission;
(ii) A general partner, managing member, or executive officer of such person, or other individual with a similar status or function; or
(iii) An employee of such person who solicits a governmental Special Entity for the swap dealer and any person who supervises, directly or indirectly, such employee.
(7) The term “solicit” means a direct or indirect communication by any person with a governmental Special Entity for the purpose of obtaining or retaining an engagement related to a swap.
(b)
(2) This prohibition does not apply:
(i) If the only contributions made by the swap dealer to an official of such governmental Special Entity were made by a covered associate:
(A) To officials for whom the covered associate was entitled to vote at the time of the contributions, provided that the contributions in the aggregate do not exceed $350 to any one official per election; or
(B) To officials for whom the covered associate was not entitled to vote at the time of the contributions, provided that the contributions in the aggregate do not exceed $150 to any one official per election;
(ii) To a swap dealer as a result of a contribution made by a natural person more than six months prior to becoming a covered associate of the swap dealer, provided that this exclusion shall not apply if the natural person, after becoming a covered associate, solicits the governmental Special Entity on behalf of the swap dealer to offer to enter into or to enter into a swap or trading strategy involving a swap; or
(iii) To a swap that is:
(A) Initiated on a designated contract market, a swap execution facility, or a trading facility currently exempted from registration as a swap execution facility by the Commission pursuant to section 5h(g) of the Act; or
(B) An A-ITBC Swap.
(3) No swap dealer or any covered associate of the swap dealer shall:
(i) Provide or agree to provide, directly or indirectly, payment to any person to solicit a governmental Special Entity to offer to enter into, or to enter into, a swap with that swap dealer unless such person is a regulated person; or
(ii) Coordinate, or solicit any person or political action committee to make, any:
(A) Contribution to an official of a governmental Special Entity with which the swap dealer is offering to enter into, or has entered into, a swap; or
(B) Payment to a political party of a state or locality with which the swap dealer is offering to enter into or has entered into a swap or a trading strategy involving a swap.
(c)
(d)
(1) Whether the exemption is necessary or appropriate in the public interest and consistent with the protection of investors and the purposes of the Act;
(2) Whether the swap dealer:
(i) Before the contribution resulting in the prohibition was made, implemented policies and procedures reasonably designed to prevent violations of this section;
(ii) Prior to or at the time the contribution which resulted in such prohibition was made, had no actual knowledge of the contribution; and
(iii) After learning of the contribution:
(A) Has taken all available steps to cause the contributor involved in making the contribution which resulted in such prohibition to obtain a return of the contribution; and
(B) Has taken such other remedial or preventive measures as may be appropriate under the circumstances;
(3) Whether, at the time of the contribution, the contributor was a covered associate or otherwise an employee of the swap dealer, or was seeking such employment;
(4) The timing and amount of the contribution which resulted in the prohibition;
(5) The nature of the election (
(6) The contributor's apparent intent or motive in making the contribution that resulted in the prohibition, as evidenced by the facts and circumstances surrounding the contribution.
(e)
(i) The swap dealer discovered the contribution within 120 calendar days of the date of such contribution;
(ii) The contribution did not exceed the amounts permitted by paragraphs (b)(2)(i)(A) or (B) of this section; and
(iii) The covered associate obtained a return of the contribution within 60 calendar days of the date of discovery of the contribution by the swap dealer.
(2) A swap dealer may not rely on paragraph (e)(1) of this section more than twice in any 12-month period.
(3) A swap dealer may not rely on paragraph (e)(1) of this section more than once for any covered associate, regardless of the time between contributions.
3. In § 23.504, revise paragraph (a)(1) to read as follows:
(a)
(i) Swaps executed prior to the date on which a swap dealer or major swap participant is required to be in compliance with this section;
(ii) Swaps that have been cleared on a derivatives clearing organization or cleared on a clearing organization that is currently exempted from registration by the Commission pursuant to section 5b(h) of the Act; and
(iii) An ITBC Swap as defined in § 23.401(d).
The following appendix will not appear in the Code of Federal Regulations.
On this matter, Acting Chairman Pham voted in the affirmative. No Commissioner voted in the negative.
Bureau of Industry and Security, Department of Commerce.
Final rule.
On April 30, 2024, the Bureau of Industry and Security (BIS) published an interim final rule (Firearms IFR) that imposed new export license requirements for firearms and related ammunition and components. American firearms manufacturers estimated that these regulatory restrictions would cost them hundreds of millions of dollars per year in lost sales. BIS, informed by public comments on the Firearms IFR, has determined that the Firearms IFR should be rescinded in its entirety—with the only exception being to maintain new Export Control Classification Numbers (ECCNs). This final rule also amends the EAR by removing the Congressional notification requirement for certain semi-automatic firearms license applications. By restoring export controls on firearms to the state they were in at the end of the first Trump Administration, BIS is advancing the Administration's commitment to reducing regulatory burdens on industry and law-abiding firearms owners.
This rule is effective September 30, 2025.
Benjamin Barron, Supervisory Export Policy Analyst, Bureau of Industry and Security, Department of Commerce, Phone: 202-482-4252, and Ronald Rolfe, Supervisory Export Policy Analyst, Bureau of Industry and Security, Department of Commerce, Phone: 202-482-4563. Both can be reached at
This final rule revises the EAR (15 CFR parts 730-774) in response to comments BIS received on the interim final rule, “Revision of Firearms License Requirements” that BIS published on April 30, 2024 (89 FR 34680) (Firearms IFR), pursuant to which BIS made a series of amendments to the EAR effective May 30, 2024. The Firearms IFR revised the license requirements and review policies, as well as other aspects of the control structure (
This final rule is organized into four sections: I—Background, II—Comments, III—Description of Regulatory Changes, and IV—Other EAR Revisions. Section I discusses the background of this final rule which includes the history of EAR firearms controls and the policy changes that shaped this final rule. In section II, BIS summarizes and responds to the comments received in response to the Firearms IFR organized into 28 topics that in turn are divided in two parts. First, BIS describes the comments of general applicability under section II.A. Then, under section II.B, BIS describes the comments received on specific changes to the regulatory text included in the Firearms IFR. In section III, BIS describes the regulatory changes made pursuant to the Firearms IFR, and how each of those changes is revised. The revisions that this final rule makes to the EAR ensure that appropriate controls are in place for 0x5zz items, while at the same time reflecting consideration of exporters' concerns regarding burdens as detailed in public comments. Finally, section IV discusses other revisions to the EAR by this final rule that were not part of the Firearms IFR. As a general matter, the regulatory actions undertaken in this final rule are consistent with BIS's ongoing commitment to reducing the regulatory burden on the American people and industry as well as adopting commonsense regulations.
The changes described in this final rule that pertain to firearms and related items are based on a comprehensive review of the EAR's provisions that affect the licensing of 0x5zz items and of public comments received on the Firearms IFR. BIS will continue to exercise appropriate regulatory oversight over the export, reexports, and transfers (in-country) of the 0x5zz items at issue but will reduce the procedural burdens and costs of export compliance on the U.S. firearms industry and American people. Notably, this final rule is eliminating controls that are more restrictive or have otherwise imposed novel burdens on exporters, reexporters, or transferors that do not apply to “600 series” military items. This final rule also takes into account that 0x5zz items are typically sold through commercial channels for civil applications, as well as to certain government end users (
BIS has determined that certain restrictions and requirements added to the EAR pursuant to the Firearms IFR imposed unnecessary regulatory burdens on exporters, reexporters, and transferors of 0x5zz items and end users of such items outside the United States and alleviates those burdens in this final rule. BIS retains the amendments in the Firearms IFR that added four new ECCNs (0A506, 0A507, 0A508, and 0A509) to the Commerce Control List (CCL) (supplement no. 1 to part 774 of the EAR), along with changes to § 758.1(g)(4) requiring ECCN item paragraph classification or other control descriptors in the Electronic Export Information (EEI) filing in the Automated Export System (AES). These provisions enable BIS to fulfill its conventional arms reporting requirements without requiring a separate submission from exporters and allow BIS's Office of Export Enforcement (OEE) to utilize its resources more efficiently to prioritize and address diversion risks of 0x5zz items. BIS also retains the paragraph restructuring, clarifying edits, and conforming changes related to the new ECCNs added by the Firearms IFR, as they provide improved comprehension of the EAR. This final rule removes all other changes to the EAR made pursuant to the Firearms IFR.
Items classified under 0x5zz ECCNs have been controlled by the Department of Commerce (Commerce) under the EAR since March 9, 2020, when jurisdiction over certain end-item firearms and related items was transferred by removing them from the Department of State's (State) United States Munitions List (USML) (
As part of the license review policy adopted pursuant to the Firearms IFR, BIS implemented more restrictive license application and review requirements, including imposing unique support documentation or other limitations or requirements on license applications for 0x5zz items. These license application and review requirements were more restrictive than those applied to other items transferred from the USML to the CCL as part of the Export Control Reform initiative (
BIS's policy is to be prudent and fiscally responsible in the expenditure of public funds, and to alleviate unnecessary regulatory and financial burdens placed on the American people. BIS has determined that the changes described in this final rule will continue to advance U.S. national security and foreign policy interests, while reducing the economic impact the Firearms IFR had on the U.S. firearms industry, the American public, and the broader U.S. economy. As with all EAR controls, these changes are designed to be as targeted as possible to accomplish BIS's mission to protect the national security and foreign policy interests of the United States.
While this final rule is reversing the majority of the changes to the EAR made pursuant to the Firearms IFR, BIS maintains license requirements and policies for 0x5zz items that allow BIS and its interagency partners sufficient latitude to review and properly adjudicate BIS licenses involving destinations, end uses, or end users of concern and to deny license applications that would involve unlawful end uses or otherwise be contrary to U.S. national security and foreign policy interests. The control structure for the 0x5zz items is also further strengthened by the part 744 end use and end user controls, as well as the embargoes and other special controls under part 746. These aspects of the control structure for 0x5zz items are not changed with this final rule. This final rule only removes requirements from the Firearms IFR that BIS has assessed are unnecessary to achieve its control objectives. The final rule is intended to be less burdensome on the firearm industry, while also treating firearms commensurate with other more sensitive items (
In response to the Firearms IFR, BIS received and posted nearly 13,000 comments, including 399 unique comments, of which 375 were responsive. There were an additional 11 “bulk” comments (consolidated and primarily duplicative comments) that were responsive. BIS appreciates the constructive comments and recommendations to enhance and/or streamline the EAR's controls and related policies and procedures as amended by the Firearms IFR, as well as those comments that raised concerns about the regulatory changes.
This final rule retains, modifies, or removes, with respect to the changes made to the EAR by the Firearms IFR, the following EAR provisions described under Table 1.
Prior to the Firearms IFR, ECCN 0A501 controlled rifles, pistols, and related “parts,” “components,” and certain “attachments,” and “accessories” on the CCL, while ECCN 0A502 controlled shotguns and related “parts,” “components,” and certain “attachments,” and “accessories.” Neither ECCN distinguished between non-automatic and semi-automatic firearms, and BIS was unable to readily disaggregate licensing and export data to efficiently evaluate information that is useful to assess the risk of diversion.
To better allow BIS to evaluate exports, reexports, or transfers (in-country) for diversion concerns of different types of 0x5zz items, the Firearms IFR added four new ECCNs to the CCL. ECCN 0A506 controls semi-automatic rifles, ECCN 0A507 controls semi-automatic pistols, ECCN 0A508 controls semi-automatic shotguns, and ECCN 0A509 controls certain “parts,” “components,” devices, “accessories,” and “attachments” for items controlled under ECCNs 0A506, 0A507, and 0A508. BIS is retaining the four new ECCNs in this final rule because they enable BIS to better prioritize enforcement resources in mitigating firearms diversion risks.
When the Firearms IFR added the new ECCNs for 0A506 and 0A508, those ECCNs included paragraphs that identified specific features or accessories (
ECCN 0A507 is also revised by adding note 2 to clarify that items, including pistols, built with,
BIS revises ECCNs 0A506 and 0A507 to remove the crime control reason for control from these ECCNs, thereby returning the items controlled under them to the control level in place prior to the Firearms IFR (
To assist exporters in understanding license exception availability, BIS revises the special conditions for License Exception STA in ECCNs 0A506, 0A507, and 0A508 to provide the limitations in the ECCNs that were in paragraphs 740.20(b)(2)(ii)(A) and (B) of STA for items controlled in ECCNs 0A501 and 0A502 and in the entry for 0A501 on the CCL prior to the Firearms IFR.
BIS is also revising ECCN 0A509, which controls items that were controlled under ECCNs 0A501 and 0A502 prior to the Firearms IFR. These two ECCNs had different reasons for control prior to the Firearms IFR. To apply the pre-Firearms IFR reasons for control for items previously classified under ECCN 0A502, the reasons for control of ECCN 0A509 are revised by excluding the following items from the NS, RS, and AT reasons for control: item paragraph .a for items for ECCNs 0A502 or 0A508, and item paragraph .d. Similarly, the CC reason for control that was applied to items that were controlled under 0A502 prior to the Firearms IFR is applied to paragraph 0A509.a for items related to 0A502 or 0A508, and paragraph 0A509.d. Special Conditions for STA are also revised to apply STA for this ECCN in the manner that was applied under 0A501 and 0A502 prior to the Firearms IFR.
This final rule also corrects an error in ECCN 0A509 in the related controls list, number 7, that references item paragraph .c rather than the correct reference to paragraph .d, when describing “parts” and “components” that are not controlled for semi-automatic shotguns in this entry. ECCN 0A509 is also revised to include LVS list-based license exception eligibility for certain “parts,” “components,” “devices,” “accessories,” and “attachments” for items previously controlled under ECCNs 0A501 and 0A502, consistent with license exception eligibility for certain 0A501 and 0A502 items prior to the Firearms IFR. Specifically, this final rule adds a $500 LVS license exception for 0A509.a, and a $500 LVS license exception for 0A509.b, .c, and .d if the ultimate destination is Canada.
ECCN 0A506 is revised by this final rule by removing the text `CC applies to entire entry' and `CC Column 2' from the control table. This ECCN is further revised by removing item paragraphs .a.1 through .a.6. This final rule revises paragraph 0A506.a to read `semi-automatic centerfire (non-rimfire) rifles equal to .50 caliber (12.7 mm) or less.' Paragraph 0A506.b is revised by this final rule to read `semi-automatic rimfire rifles equal to .50 caliber (12.7 mm) or less.' Special conditions for STA in ECCN 0A506 are added to the reasons for control section with the text `License Exception STA may not be used for ECCN 0A506, to any of the destinations listed in Country Group A:5 or A:6 (See supplement no.1 to part 740 of the EAR).'
ECCN 0A507 is revised by this final rule by removing the text `CC applies to entire entry' and `CC Column 2' from the control table. A new Note 2 to 0A507 is added with the text `Firearms, including pistols, built with, e.g., AR- or AK-style receivers (frames) are controlled under ECCN 0A506.' Special conditions for STA in ECCN 0A507 are added to the reasons for control section with the text `License Exception STA may not be used for ECCN 0A507, to any of the destinations listed in Country Group A:5 or A:6 (See supplement no.1 to part 740 of the EAR).'
ECCN 0A508 is revised by this final rule by removing the text `CC applies to entire entry' and `CC Column 2' from the control table. A new row after the FC row is added with the text `CC applies to shotguns with a barrel length less than 24 in. (60.96 cm) and shotgun “components” controlled by this entry regardless of end user' is added under the control(s) column and `CC Column 1' under the country chart column. After this row, a new row is added with the text `CC applies to shotguns with a barrel length greater than or equal to 24
This final rule also revises ECCN 0A508 by removing item paragraphs a.1 through a.6; paragraph 0A508.a is revised to read `semi-automatic centerfire (non-rimfire) shotguns,' and paragraph 0A506.b is revised to read `semi-automatic rimfire shotguns.' Special conditions for STA in ECCN 0A508 are added to the reasons for control section with the text `License Exception STA may not be used for any shotguns with barrel length less than 18 inches controlled in 0A508, to any of the destinations listed in Country Group A:5 or A:6 (See supplement no.1 to part 740 of the EAR).'
ECCN 0A509 is revised by this final rule by removing the text `CC applies to entire entry' and `CC Column 2' from the control table and replacing it with `CC applies to 0A509.a for items for ECCN 0A502 or ECCN 0A508, and 0A509.d' under the control(s) column and `CC Column 1' under the country chart column.' The control table is further revised by adding the text `except 0A509.a for items for ECCN 0A502 or ECCN 0A508, and 0A509.d' after the word `entry' in the NS, RS, and AT rows under the control(s) column. This final rule replaces `.c' with `.d' in item number seven in the related controls list. The ECCN is revised by adding a list based license exception with the text `LVS: $500 for 0A509.a, $500 for 0A509.b, .c, and .d if the ultimate destination is Canada.' Special conditions for STA in ECCN 0A509 are added to the reasons for control section with the text `License Exception STA may not be used for ECCN 0A509, except for 0A509.a for items for ECCN 0A502 or ECCN 0A508, and 0A509.d, to any of the destinations listed in Country Group A:5 or A:6 (See supplement no.1 to part 740 of the EAR).' Finally, a clarifying revision is made to Note 1 to 0A509.b and .c by adding a sentence to the end of the note to specify that `For 0A509.c, receivers (frames) includes chassis “components” that serve as the legal firearm (
In the Firearms IFR, BIS reevaluated the reasons for control for rifles, pistols, shotguns, ammunition, and related “parts,” “components,” “accessories,” “attachments,” “software,” and “technologies” detailed under existing ECCNs 0A501, 0A502, 0A504, 0A505, 0D501, 0D505, 0E501, 0E502, 0E504, and 0E505, and applied CC column 2-based controls on most items under these ECCNs. Certain specific “parts” and “components” and ammunition controlled under ECCNs 0A501.y, 0A505.c, and 0A505.d continued not to be controlled for CC reasons. In this final rule, BIS has reassessed the appropriate controls to minimize burdens on exporters to the extent possible. BIS revises the crime control for the existing 0x5zz ECCNs by returning it to its application prior to the Firearms IFR.
Prior to the Firearms IFR, crime control was not applied to ECCN 0A501. In this final rule, BIS removes crime control from the reason for control from the ECCN. This revision is in keeping with the BIS policy to ensure that appropriate controls are in place for 0x5zz items; notably, NS, RS, FC, UN, and AT reasons for control remain applicable to 0A501. This revision returns 0A501 to its pre-Firearms IFR control.
Prior to the Firearms IFR, either CC Column 1, CC Column 2, or CC Column 3 of supplement no. 1 to part 738 (Commerce Country Chart) applied to shotguns controlled under ECCN 0A502 based on the barrel length and particular end user (specifically, police or law enforcement). The Firearms IFR revised the CC reasons for control on 0A502 by applying CC Column 2 to the entire entry of 0A502 regardless of barrel length or end user. This final rule revises the crime control for ECCN 0A502 to apply the control in place prior to the Firearms IFR as follows: for shotguns with a barrel length less than 24 inches (60.96 cm), CC 1 is applied; for shotguns with a barrel length greater than or equal to 24 inches (60.96 cm) regardless of end user, CC 2 is applied; and for shotguns with a barrel length greater than or equal to 24 inches (60.96 cm) for sale or resale to police or law enforcement, CC 3 is applied.
Additionally, to assist exporters in understanding license exception availability, BIS revises the special conditions for STA in ECCNs 0A501, 0A502, 0A505, 0D501, 0D505, 0E501, 0E504, and 0E505 to state more clearly the limitations in the ECCNs that were in paragraphs 740.20(b)(2)(ii)(A) and (B) of License Exception STA or in the relevant ECCNs prior to the Firearms IFR. As a result of these changes, the applicable limitations on STA availability for these ECCNs are now set forth in the special conditions section of each ECCN.
The Firearms IFR also changed the crime controls for firearm-related items by revising ECCN 0A504, optical sighting devices for firearms, and ECCN 0A505, ammunition, by applying CC Column 2 to those ECCNs. This final rule revises ECCN 0A504 by reverting the crime control to CC Column 1.
This final rule also revises ECCN 0A505 by removing items 0A505.a and . x from the CC control and reverting the CC control from CC Column 2 to CC Column 1. Both of these revisions restore the reasons for control that had applied prior to the Firearms IFR.
The Firearms IFR also applied CC 2 to ECCNs 0D501 (for the entire entry except “software” for commodities in ECCN 0A501.y or equipment in ECCN 0B501 for commodities in ECCN 0A501.y), 0D505 (this control was not correctly reflected in ECCN 0D505 in the Code of Federal Regulations due to an inadvertent error), 0E501, 0E502, 0E504, and 0E505 (for “technology” for the “development” or “production” of commodities in 0A505.b). This final rule restores the reasons for control for these ECCNs to those that were in place prior to the Firearms IFR. For ECCN 0E502 and 0E505 (for “technology” for the “development” or “production” of commodities in 0A505.b), the reason for control is revised from CC2 to CC1. For ECCNs 0D501, 0D505, 0E501, 0E504, and 0E505 (for “technology” for the “development” or “production” of commodities in 0A505.a or .x), the CC2 reason for control is removed.
The changes described in section III.A of this preamble, including the changes to both the new and existing 0x5zz ECCNs, are expected to result in a decrease of 1200 license applications received annually by BIS.
This final rule revises the control tables for ECCNs 0A501, 0A502, 0D501, 0D505, 0E501, and 0E504 by removing the row with the text `CC applies to entire entry' in the control(s) column and `CC Column 2' in the Country Chart column from all of these ECCNs.
ECCN 0A501 is amended by this final rule by revising the text specifying the special conditions for STA to read as follows: `License Exception STA may not be used for ECCN 0A501.a, .b, .c, .d, or .e, to any of the destinations listed in Country Group A:5 or A:6 (See supplement no.1 to part 740 of the EAR). License Exception STA may not be used for any item in this entry to any
This final rule revises ECCN 0A502 by adding a new row after the FC row with the text `CC applies to shotguns with a barrel length less than 24 in. (60.96 cm) and shotgun “components” controlled by this entry regardless of end user' is added under the control(s) column and `CC Column 1' under the country chart column. Specifically, a new row is added with the text `CC applies to shotguns with a barrel length greater than or equal to 24 in. (60.96 cm), regardless of end user' under the control(s) column and `CC Column 2' under the country chart column. A final new row is added above the UN row with the text `CC applies to shotguns with a barrel length greater than or equal to 24 in. (60.96 cm) if for sale or resale to police or law enforcement' under the control(s) column and `CC Column 3' under the country chart column. Special conditions for STA are added to the reasons for control section with the text `License Exception STA may not be used for any shotguns with barrel length less than 18 inches controlled in 0A502, to any of the destinations listed in Country Group A:5 or A:6 (See supplement no.1 to part 740 of the EAR).'
This final rule revises the reason for control table for ECCN 0A504 by replacing the number `2' with the number `1' in the country chart column for the CC row.
This final rule also revises ECCN 0A505 by replacing the number `2' with the number `1' in the country chart column for the CC row. The CC row is further revised by removing the text `.a, ' and `, and .x' from the control(s) column. Additionally, ECCN 0A505 is amended by this final rule by revising the text specifying the special conditions for STA to read as follows: `License Exception STA may not be used for ECCN 0A505, to any of the destinations listed in Country Group A:6 (See supplement no.1 to part 740 of the EAR).'
This final rule revises the text specifying the special conditions for STA in ECCN 0D501 to read as follows: `License Exception STA may not be used for any “software” in ECCN 0D501, to any of the destinations listed in Country Group A:6 (See supplement no.1 to part 740 of the EAR).'
ECCN 0D505 is amended by this final rule by revising the text specifying the special conditions for STA to read as follows: `License Exception STA may not be used for any “software” in ECCN 0D505, to any of the destinations listed in Country Group A:6 (See supplement no.1 to part 740 of the EAR).
This final rule revises the text specifying the special conditions for STA in ECCN 0E501 to read as follows: `License Exception STA may not be used for any “technology” in ECCN 0E501, to any of the destinations listed in Country Group A:6 (See supplement no.1 to part 740 of the EAR).'
This final rule revises the control table for ECCN 0E502 by replacing the `2' after `CC Column' in the Country Chart row with a `1.'
ECCN 0E504 is revised by adding special conditions for STA with the text `License Exception STA may not be used for any “technology” in ECCN 0E504, to any of the destinations listed in Country Group A:5 or A:6 (See supplement no.1 to part 740 of the EAR).' The control table for ECCN 0E505 is revised by replacing the number `2' with the number `1' in the country chart column for the CC row. The CC row is further revised by removing the text `.a, ' and `, and .x' from the control(s) column. This final rule also places double quotes around the word `equipment' where it appears in the NS and RS rows in the control table for ECCN 0E505. Additionally, the text specifying the special conditions for STA is revised to read as follows: `License Exception STA may not be used for any “technology” in ECCN 0E505, to any of the destinations listed in Country Group A:6 (See supplement no.1 to part 740 of the EAR).
With the exception of those commodities controlled under new ECCNs 0A506, 0A507, 0A508, and 0A509 as described above, all firearms, shotguns, and their “parts,” “components,” “accessories,” “attachments,” and equipment remain controlled under ECCNs 0A501 and 0A502 on the CCL. With BIS maintaining the four new ECCNs, this final rule retains the conforming changes made throughout the EAR pursuant to the Firearms IFR referencing these new ECCNs where ECCNs 0A501 and 0A502 were referenced prior to the Firearms IFR. These conforming changes ensure that the semi-automatic versions of end-item firearms and shotguns controlled under ECCNs 0A506, 0A507, and 0A508, as well as the commodities controlled under ECCN 0A509, will continue to be subject to the same licensing restrictions and limitations on license exception availability as non-automatic firearms, shotguns, and related items.
Section 740.2 of the EAR details restrictions in place on the use of all License Exceptions. Paragraph (a) enumerates these restrictions. The Firearms IFR made two changes to this section. With the addition of the CC control under ECCNs 0A501, 0A506, and 0A507, the Firearms IFR revised the general restriction on the use of license exceptions under § 740.2(a)(4)(iii) to remove a parenthetical that could be read to limit the use of License Exception BAG to only certain shotguns and shotgun shells for personal use. BIS maintains this clarifying revision.
The Firearms IFR added paragraph (a)(24) to § 740.2 as part of the requirement for exporters to obtain a copy of an import certificate or equivalent document (if required by the government of the importing country) in order to use any license exception for items controlled under ECCNs 0A501, 0A502, 0A504, 0A505, 0A506, 0A507, 0A508, or 0A509. This final rule removes this requirement based on BIS's determination that it is unnecessary. However, BIS will continue to include the pre-Firearms IFR standard rider on 0x5zz item licenses in situations in which an import certificate or equivalent document must be obtained if required by the importing country prior to using the license. While this change should reduce the burden on exporters, it is likely to be negligible and is not expected to change the burden hours for exporters, because exporters should have an existing process to identify when an import certificate or equivalent document is required by the importing country.
The revision to § 740.2 is consistent with BIS's overall approach in this final rule to reduce the regulatory burden on the American people and industry.
This final rule removes and reserves paragraph § 740.2(a)(24).
License Exception LVS is detailed under § 740.3. In this final rule, BIS is revising the Firearms IFR destination eligibility restrictions for LVS under paragraph (b). Specifically, as amended by the Firearms IFR, LVS was made unavailable for commodities controlled under 0x5zz ECCNs (except 0A504.g) for destinations in CARICOM or Country Group D:5. This final rule removes the license exception eligibility destination restriction for CARICOM and Country Group D:5 and returns this paragraph to its pre-Firearms IFR text. BIS has assessed that a restriction on the use of LVS for destinations in CARICOM and Country Group D:5 is not necessary to protect U.S. national security and foreign policy interests. Should a country assess that more restrictive controls are necessary, its own import restrictions can address those concerns. This revision is in keeping with BIS's commitment to remove unnecessary regulations that impose a burden on U.S. companies and the American people. License Exception LVS remains available only for certain commodity ECCNs. This change is expected to decrease the number of annual license applications by 500.
License Exception BAG is detailed under § 740.14. License Exception BAG authorizes individuals leaving the United States either temporarily (
The Firearms IFR revised § 740.14 to clarify that there is a limit to the number of firearms that an individual may export using license exception BAG to three firearms in total. Under paragraph (e), this has been BIS's longstanding interpretation. The Firearms IFR's clarification to license exception BAG, which assists exporters in understanding this license exception, is not changed by this final rule. BIS's interpretation of this license exception also remains unchanged. BIS does not anticipate a change in the number of annual license applications received by BIS.
This rule revises § 740.3(b) by removing the text `however, License Exception LVS is not available for 0x5zz items (except 0A504.g) when destined for countries in “CARICOM” or countries in Country Group D:5.' In addition, § 740.14, paragraph (e)(5) is removed.
With the removal of all references to CARICOM from §§ 740.3 and 740.14, this final rule also revises § 772.1 by removing the definition of the term.
As part of the BIS effort to review firearms-related policies and address concerns related to misuse or diversion contrary to U.S. national security and foreign policy interests, including diversion to entities or activities that promote regional instability, abuse or violate human rights, and/or fuel criminal activities, the Firearms IFR identified two control policies for revision. The Firearms IFR revised the license review policies under the RS and CC sections in part 742 of the EAR. This final rule revises the license review policy provisions of the Firearms IFR described below. Consistent with these more streamlined review policies, BIS will continue to consider the risk that 0x5zz items will be diverted or misused in a manner that would adversely impact U.S. national security or foreign policy.
The RS license review policy is detailed under § 742.6. In § 742.6, the Firearms IFR made conforming changes to paragraph (b) for the addition of the new ECCNs, as well as several structural changes to paragraph (b)(1)(i) to make the paragraph more readily understandable. This final rule maintains those conforming and structural revisions to § 742.6.
The Firearms IFR also revised the paragraph structure of the CC license review policy detailed under § 742.7. This final rule revises § 742.7 by placing the paragraphs referencing firearms in sequential order under paragraphs (a)(1) through (3). This final rule revises § 742.7(a)(1) by adding a reference to ECCNs 0A502, 0A504, 0A505, 0A508, 0A509, 0A982, 0E502, and 0E505. This final rule revises these ECCNs to apply the pre-Firearms IFR CC 1 control, and they are therefore added to this paragraph. Paragraphs (a)(2) and (a)(3) are revised to describe the application of the pre-Firearms IFR CC 2 and CC 3, respectively, for certain items and end users. In § 742.7, former paragraphs (a)(2), (3), and (4) are redesignated as paragraphs (a)(4), (5), and (6), respectively with no other revisions. Finally, paragraph 742.7(a)(5), added by the Firearms IFR, detailed items specific to certain firearms, shotguns, and related items, and crime control and detection instruments and equipment and related “technology” and “software” identified in the appropriate ECCNs on the CCL under CC Column 2 in the Country Chart column. This text is removed by this final rule.
The Firearms IFR restructured § 742.7(b) by adding a new paragraph (b)(3) to describe the license review policies for government and non-government end users for items controlled by paragraph (a)(5). This final rule removes the license review policy differentiating between government and non-government end users and removes § 742.7(b)(3) because it is not necessary to impose these conditions on the license review process to protect U.S. national security and foreign policy interests. The license review policies for 0x5zz ECCNs existing prior to the Firearms IFR already provide enough discretion for BIS and its interagency partners to deny licenses for military and police end users, as well as any other party to the transaction, implicated in human rights abuses, collusion with criminal groups, acts of instability or violence, or other actions that pose national security or foreign policy harm. BIS also emphasizes that the existing RS license review policy, in place prior to the Firearms IFR, imposes a presumption of denial for those types of end users. Additionally, BIS takes into account that 0x5zz items are commercial items that are sold through commercial channels, and that they are used for civil applications as well as certain government end uses (
In this final rule, § 742.7(a)(1) is revised by adding the text `0A502 (for shotguns with a barrel length less than 24 inches and shotgun “parts” and “components”), 0A504, 0A505.b, 0A508 (for shotguns with a barrel length less than 24 inches and shotgun “parts” and “components”), 0A509.a (for items for ECCN 0A502 or ECCN 0A508), 0A509.d,' before 0A977 and `0E502, 0E505 (“technology” for “development” or for “production” of buckshot shotgun shells controlled under ECCN 0A505.b),' before 0E977 in the list of ECCNs. Paragraph (a)(2) to § 742.7 is revised to read `shotguns with a barrel length greater than or equal to 24 inches, identified in ECCN 0A502 or 0A508 on the CCL under CC Column 2 in the Country Chart column of the “License Requirements” section regardless of end user to countries listed in CC Column 2 (supplement no. 1 to part 738 of the EAR).' Section 742.7(a)(3) is revised to read `Shotguns with barrel length greater than or equal to 24 inches, identified in ECCN 0A502 or 0A508 on the CCL under CC Column 3 in the Country Chart column of the “License Requirements” section only if for sale or resale to police or law enforcement entities in countries listed in CC Column 3 (supplement no. 1 to part 738 of the EAR).' Section 742.7(a)(4) is revised to read `Items designed for the execution of human beings as identified in ECCN 0A981 require a license to all destinations including Australia, Canada, and the United Kingdom. Controls for these items appear in each ECCN; a column specific to these controls does not appear in the Country Chart (supplement no. 1 to part 738 of the EAR).' Section 742.7(a)(5) is revised to read `Certain crime control items require a license to all destinations, except Canada. These items are identified under ECCNs 0A982, 0A503, and 0E982. Controls for these items appear in each ECCN; a column specific to these controls does not appear in the Country Chart (supplement no. 1 to part 738 of the EAR).' Finally, 742.7(a)(6) is added with the text `See § 742.11 of the EAR for further information on items controlled under ECCN 0A983, which require a license to all destinations, including Australia, Canada, and the United Kingdom. Controls for these items appear in each ECCN; a column specific to these controls does not appear in the Country Chart (supplement no. 1 to part 738 of the EAR).'
Section 742.7(b) is revised by removing the text `paragraph (a)(1) through (a)(4).' Additionally, in § 742.7, paragraph (b)(3) and the note to paragraph (b)(3) are removed by this final rule.
This final rule revises supplement no. 1 to part 738 by removing CC 2 from every country except for the following: Armenia, Azerbaijan, Belarus, Cambodia, Fiji, Georgia, Iraq, Kazakhstan, Kosovo, Kyrgyzstan, Laos, Moldova, Mongolia, Montenegro, Russia, Rwanda, Serbia, Tajikistan, Turkmenistan, Ukraine, Uzbekistan, and Vietnam. This returns the Commerce Country Chart column CC 2 to its scope prior to the Firearms IFR.
Additionally, supplement no. 1 to part 738 is revised by adding new footnote ten, which applies the control policy for most 0x5zz items to Australia and the United Kingdom. The contents of this footnote were previously added to supplement no. 1 to part 738 by the rule “Export Control Revisions for Australia, United Kingdom, United States (AUKUS) Enhanced Trilateral Security Partnership” 89 FR 28594 (April 19, 2024) and revised by the rule “Export Control Revisions for Australia, United Kingdom, United States (AUKUS) Enhanced Trilateral Security Partnership; Correction” 89 FR 38838 (May 8, 2024). The contents of this footnote were removed by the Firearms IFR because the footnote was unnecessary given the implementation of a worldwide crime control on these items, including to Australia and the United Kingdom. With the addition of new footnote ten, this final rule returns to the Country Chart the 0x5zz control policy footnote for Australia and the United Kingdom, including conforming changes that reflect the addition of the ECCNs added by the Firearms IFR.
This final rule revises supplement no. 1 to part 738 by adding footnote ten with the text `
In conjunction with the addition of the presumption of denial license review polices added by the Firearms IFR to § 742.7, BIS requested that the Department of State identify a list of countries where there was a substantial risk that 0x5zz items would be diverted or misused in a manner contrary to U.S. national security or foreign policy interests. In the Firearms IFR, BIS adopted a presumption of denial for exports, reexports, and transfers (in-country) to non-government end users in 36 destinations identified by State, which are listed in supplement no. 3 to part 742, High-Risk Destinations for 0x5zz Items.
Supplement no. 3 to part 742 is removed by this final rule following a consideration of the longstanding risk assessment that governs BIS's control of 0x5zz items to these destinations as well as more generally to end users in all destinations. Most of these items are controlled for NS and RS reasons, and BIS will undertake a thorough review of all license applications for such items destined for all end users in these 36 destinations (and in all other destinations). A presumption of denial policy for non-government end users in these 36 destinations is consequently not warranted. BIS has determined that the licensing policies that existed prior to the Firearms IFR are sufficient to identify the risk of diversion or misuse in these destinations in a manner contrary to U.S. national security or foreign policy goals.
With the removal of supplement no. 3 to part 742, a presumption of denial no longer applies to the application review policy for exports and reexports to non-government end users in the following destinations: The Bahamas, Bangladesh, Belize, Bolivia, Burkina Faso, Burundi, Chad, Colombia, Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Honduras, Indonesia, Kazakhstan, Kyrgyzstan, Laos, Malaysia, Mali, Mozambique, Nepal, Niger, Nigeria, Pakistan, Panama, Papua New Guinea, Paraguay, Peru, Suriname, Tajikistan, Trinidad and Tobago, Uganda, Vietnam, and Yemen.
Supplement no. 3 to part 742, High-Risk Destinations for Firearms and Related Items, is removed and reserved.
The Firearms IFR revised the licensing policies for the export and reexport of most 0x5zz items to all OAS member countries under § 742.17(b).
Under this final rule, there will continue to be two distinct licensing policies for exports and reexports of 0x5zz items to OAS member countries, as revised from the policies under the Firearms IFR: a policy of general approval and a policy of denial for applications linked to drug trafficking, terrorism, and criminal activities. Under the Firearms IFR, applications supported by an FC Import Certificate or equivalent official document issued by the government of the importing country were reviewed on a case-by-case basis, as opposed to the license review policy of general approval that applied before the Firearms IFR. This final rule revises § 742.17(b) to a license review policy of general approval for applications supported by an FC Import Certificate because the pre-Firearms IFR policy, in combination with other applicable review policies, sufficiently accounts for situations in which there may be a risk of diversion or misuse. BIS does not anticipate any change to the number of license applications received annually with the removal of the case-by-case review policy. The Firearms IFR, as well as this final rule, have not changed the license review policy of denial for applications to export items linked to drug trafficking, terrorism, and criminal activities. This retention of this policy is not expected to have any impact on the number of license applications received by BIS.
This final rule revises § 742.17(b) to have it read `applications supported by an FC Import Certificate or equivalent official document issued by the government of the importing country for such items will generally be approved, except there is a policy of denial for applications to export items linked to such activities as drug trafficking, terrorism, and transnational organized crime.'
Prior to the Firearms IFR (effective May 30, 2024), BIS required the submission of an import certificate or other equivalent official document only for OAS member states described in § 748.12. By contrast, prior to the Firearms IFR, for non-OAS member states that require an import certificate or equivalent official document, the applicant was required to obtain a copy of such documentation but only required to submit it with the license application if specifically requested by BIS. The Firearms IFR required that all license applications for 0x5zz items include an import certificate or equivalent official document as part of the license application submission.
This final rule restores the requirements for the submission of this document that had applied prior to the Firearms IFR, apart from the minor conforming changes made due to the addition of the four new ECCNs and new revisions that allow for the use of electronic equivalent documents to fulfill this requirement. While this final rule revises the Firearms IFR requirement to submit an import certificate or other equivalent official document, all approved licenses for firearms will continue to include a rider which requires the exporter to maintain a current valid import permit, if required by the government of the importing country, for every export against the license. This is an element that predated the Firearms IFR and is an essential component demonstrating that EAR licensing takes into account whether foreign countries or other destinations permit the importation of 0x5zz items. With this, and other provisions that predate the Firearms IFR, BIS continues to ensure that it meets its objective of protecting U.S. national security and foreign policy interests. In reverting to the prior requirements, BIS is reducing the complexity of the submission requirements for license applications for 0x5zz items to destinations outside the OAS, thereby eliminating burdens on the industry. These changes are expected to result in a decrease of 250 import certificates or other equivalent official documents that need to be submitted with BIS license applications. BIS estimates that the time required to submit each document is 1 minute. This change will result in a decrease in burden hours of 4 hours.
The Firearms IFR revised the introductory text to § 748.12 and paragraphs (a), (b), (c), and (d). The preamble of the Firearms IFR discussed the removal of paragraph (e) by that rule, but the instruction for § 748.12 did not include the removal of that paragraph. This final rule reverts paragraphs 748.12(a), (b), (c), and (d) to their pre-Firearms IFR text, and does not revise the current paragraph (e), which is the pre-Firearms IFR text. Previously, the importer was required to provide the original or a certified copy. This change to accept electronic documents will reduce an unnecessary burden. Also, in § 748.12, paragraph (c) is revised to allow for the use of country import certificates that do not contain all of the information requested in paragraph (c). The only revision from the Firearms IFR that remains unchanged by this final rule is paragraph 748.12(a)(2)(i) which details OAS member countries. The Firearms IFR added a clarifying reference to this paragraph to state that OAS member countries include any member country that has acceded in accordance with Chapter III of the Charter of the Organization of American States.
This final rule revises the introductory text to § 748.12 to read `license applications for certain firearms and related commodities require support documents in accordance with this section. For destinations that are members of the Organization of American States (OAS), an FC Import Certificate, equivalent official document, or the electronic equivalent document officially issued by the foreign government, is required in accordance with paragraphs 748.12(a) through (d) of this section. For other destinations that require a firearms import or permit, the firearms import certificate or permit is required in accordance with paragraph 748.12(e) of this section.' Paragraphs 748.12(a) through (e) are revised by this rule by replacing all instances to the reference of `import certificate,' `document,' or `a certified copy,' with `FC Import Certificate,' `its official equivalent,' or `a copy,' respectively, where necessary. Paragraph 748.12(a) is revised by replacing the text of the heading with `requirement to obtain and documentation for OAS member states' and replacing the text `if required by the importing country' with the text—`that are destined for member countries of the OAS.' Paragraph 748.12(a)(1) is revised to read `
The Firearms IFR revised paragraph (aa) in supplement no. 2 to part 748 to include the unique application and submission requirements that applied to exports of other firearms, certain shotguns, and related commodities. In supplement no. 2 to part 748, the contents of the pre-Firearms IFR paragraph (bb), `semiautomatic firearms controlled under ECCN 0A501.a,' was redesignated under paragraph (aa)(1), with conforming revisions made to the title corresponding to the addition of new ECCNs. New paragraph (aa)(2) required the submission of purchase order documentation for certain applications, and new paragraph (aa)(3) required the submission of passport or other national identity card information for certain applications in supplement no. 2 to part 748.
The Firearms IFR amended the EAR by adding paragraph (aa)(2) to supplement no. 2 to part 748 to require a purchase order be submitted for exports and reexports of 0x5zz items to non-A:1 countries. Previously, exporters were not required to submit a purchase order with BIS license applications unless requested during BIS's review of a particular application. Consistent with its objective to limit regulatory burden, BIS has assessed that it can eliminate the purchase order requirement while continuing to protect U.S. national security and foreign policy interests. When the 0x5zz items were moved from the USML to the CCL, BIS described the absence of a purchase order requirement as one of the reductions in regulatory burden. The other items that moved from the USML to the CCL, the “600 series” and 9x515 items, also did not have a purchase order requirement. BIS assesses that treating 0x5zz items at least equivalently, and not more restrictively, than “600 series” and 9x515 items is sufficient to protect national security and foreign policy interests.
The Firearms IFR amended the EAR to require that a passport or national identity card be submitted for exports and reexports of 0x5zz items to natural persons (individuals) in non-A:1 countries. Previously, passports or national identity cards were not required with submission of applications for export to individuals unless requested by BIS for a specific license application. Under the Firearms IFR, license applications for items controlled under ECCNs 0A501 (except 0A501.y), 0A502, 0A504, 0A505 (except 0A505.c, 0A505.d, and 0A505.e), 0A506, 0A507, 0A508, and 0A509 for individuals in destinations other than Country Group A:1 required the submission of a passport or national identity card for all named individual recipient end users of those items. This requirement was detailed under new paragraph (aa)(3) to supplement no. 2 to part 748. This final rule revises the EAR by removing the requirement that a passport or national identity card must be submitted for 0x5zz items to individual persons in non-A:1 countries and removes paragraph (aa)(3) to supplement no. 2 to part 748. Requiring license applicants to provide an end user passport or national identity card for 0x5zz items with the initial application would be more restrictive than the support document requirements for items of greater sensitivity (
In supplement no. 2 to part 748—Unique Application and Submission Requirements, paragraph (aa)(2) and (aa)(3) are removed by this final rule. Paragraph (aa)(1) in supplement no. 2 to part 748 is also removed due to the removal of the congressional notification requirement discussed in section IV.A of this final rule's preamble. Paragraph (bb) is redesignated as paragraph (aa) with its text unchanged by this final rule in supplement no. 2 to part 748.
BIS license applications involving 0x5zz items are reviewed by the longstanding interagency review processes specified under part 750 of the EAR. Accordingly, BIS has consulted with interagency partners regarding the review of license applications for exports and reexports of these items since their additions to the CCL effective March 2020.
The Firearms IFR formalized an interagency working group, chaired by State, to evaluate firearm diversion and misuse risks. The Firearms IFR added § 750.4(d)(2)(v), which described a new working group called “The Safeguard.”
The risk factors considered by the interagency working group were already part of interagency review for firearms-related license applications prior to the Firearms IFR. Therefore, BIS has determined that the Safeguard is largely duplicative of existing interagency review efforts and unnecessary to achieve BIS's national security and foreign policy goals. BIS will continue to gather feedback from other agencies during the interagency review process that occurs in connection with all license applications. Consistent with the goal to eliminate unnecessary regulations, BIS removes this provision from the EAR in this final rule. This change is not expected to have any impact on the number of license applications received by BIS.
In this final rule, § 750.4(d)(2)(v) is removed.
The Firearms IFR amended the EAR to reduce the general validity period from four years to one year for all future licenses involving 0x5zz items. This final rule reverses the general validity period from one year to four years for licenses involving 0x5zz items. BIS license review policy continues to apply national security and foreign policy considerations (including human rights-related considerations), and a shorter license period may be granted if warranted by circumstances.
BIS acknowledges that shorter licensing periods create a burden for both the government, which must process a greater number of license applications and renewals, and exporters who require licenses issued in a timely manner. BIS is also committed to removing unnecessary regulations that may negatively impact American businesses. This change is expected to result in a decrease of 500 license applications received annually by BIS.
This rule revises § 750.7(g) by removing, from the third sentence, the text `and controlled under ECCNs 0A501, 0A502, 0A504, 0A505, 0A506, 0A507, 0A508, or 0A509, which will generally be limited to a one-year validity period.'
The Firearms IFR created four new ECCNs, 0A506, 0A507, 0A508, and 0A509, to help distinguish between non-automatic and semi-automatic firearms exports in AES EEI filings, along with the export of certain “parts,” “components,” devices, “accessories,” and “attachments” for semi-automatic firearms and semi-automatic shotguns. In order to further enhance the export data to distinguish between end-item firearms exports and other firearms “parts,” “components,” devices, “accessories, or “attachments” exports, as well as simplify the conventional arms reporting requirements for firearms under the EAR (§ 743.4) via Electronic Export Information (EEI) in the Automated Export System (AES), the Firearms IFR revised the requirement in § 758.1(g)(4)(ii), which previously allowed exporters to complete their conventional arms reporting requirements without submitting conventional arms reports to BIS. That rule revised this reporting requirement making conventional arms reporting information in the EEI filing in AES mandatory by specifying that exporters must include the items-level classification or other items-level descriptor in the Commodity description block in the EEI filed in AES. This final rule makes no changes to the mandatory filing provision.
The Firearms IFR also expanded the scope of this mandatory export clearance requirement to include not only ECCNs 0A501.a or .b and shotguns with a barrel length less than 18 inches controlled under ECCN 0A502, but also to include items controlled under ECCNs 0A501.a or .b, 0A506.a or .b, 0A507.a and .b, shotguns with a barrel length less than 18 inches controlled under ECCNs 0A502 or 0A508.a. or .b, or “parts,” “components,” devices, “accessories,” or “attachments” controlled under 0A509.a, .b, .c, or .d. To assist exporters in identifying the information that must be included in the Commodity description block in the EEI filing in AES, the Firearms IFR added new paragraphs 758.1(g)(4)(ii)(A) through (F). In § 758.1, this final rule makes no changes to paragraphs (g)(4)(ii)(A) through (E); however, paragraph (g)(4)(ii)(F) is removed due to the fact that these items are not part of the reporting requirements described in this section. Finally, the description of items in paragraph 758.1(g)(4)(ii) for ECCN 0A508 are changed from `.a.1 or .a.2' to `.a or .b' which was the intended revision as described in the preamble of the Firearms IFR. Maintaining this provision will aid OEE in more effectively mitigating the diversion risk of firearms.
These changes have not resulted in an increase in burden; a commodity description was already required to be provided in the EEI in AES prior to the effective date of the Firearms IFR, so including this additional information as part of the commodity description does not change the burden hours for exporters.
In § 758.1, the heading is revised by removing the text `
The Firearms IFR revised § 743.4 to specify that BIS will be relying solely on the alternative submission method for obtaining the required information for the conventional arms reporting. The Firearms IFR also revised § 743.4 to make conforming changes to add references to the end-item firearms controlled under ECCNs 0A506.a and .b and 0A507.a and .b, and to specify that these semi-automatic rifles and pistols are included for the conventional arms reporting for the Wassenaar Arrangement semi-annual reporting and the United Nations annual report described under § 743.4. This approach is consistent with how these items were previously reported when controlled under ECCN 0A501.a or .b. The changes discussed below regarding BIS's use of EEI data to meet conventional arms reporting requirements affect both the existing ECCNs and the newly added ECCNs referenced in § 743.4 (
In preparing the Firearms IFR, BIS reevaluated the conventional arms reporting requirements under existing § 743.4 and the alternative submission method for ECCN 0A501.a and .b referenced under §§ 743.4(h) and 758.1(g)(4)(ii) based on its experience since ECCNs 0A501.a and .b were added to the EAR on March 9, 2020. BIS determined, based on this review, that the conventional arms reporting requirements could be simplified by making the alternative submission method the sole method that exporters may use to submit the information to meet the conventional arms reporting requirement for ECCN 0A501.a or .b, as well as for semi-automatic rifles controlled under ECCN 0A506.a and .b
Previously, BIS added the alternative submission method in § 743.4(h) of the EAR as part of the January 2020 EAR final rule to reflect exporters' recommendation that BIS use AES EEI data to obtain the information required for these two conventional arms reports. The alternative submission method gave exporters the option of including the additional .a or .b information as the first characters to appear in the commodity description block in AES, rather than requiring submission of information on end-item firearms under ECCN 0A501.a and .b in separate reports to BIS. Based on data reviewed by BIS, nearly all exporters have been using this alternative submission method to meet their conventional arms reporting requirements since March 9, 2020, the effective date of the January 2020 rule. The alternative submission method has also been an efficient method for extracting the data needed by BIS to prepare these reports. This final rule makes no changes to these provisions.
In addition, the Firearms IFR revised § 758.1(g)(4)(ii), to include the “items” level paragraph classification as the first characters to appear in the Commodity description block in the EEI filed in AES for ECCNs 0A501.a and .b, 0A506.a and .b, 0A507.a and .b, 0A508.a and .b. This final rule retains this provision, consistent with BIS's interest in aiding OEE's effort to mitigate diversion risk. Given that a commodity description was already previously required in the EEI filing in AES, including this additional information as part of the commodity description is not expected to change the burden hours for exporters.
In a June 1, 2022, firearms-related final rule, “Adoption of Congressional Notification Requirement for Certain Semiautomatic Firearms Exports Under the Export Administration Regulations (EAR)” (June 1 final rule) (87 FR 32983), BIS adopted a Congressional notification requirement for license applications for semiautomatic firearms (then classified under ECCN 0A501.a) meeting certain value and destination requirements under the EAR. These items were subject to a Congressional notification requirement under the ITAR prior to their transfer to the EAR. While the ITAR's Congressional notification requirement that had previously applied to these items was informative for developing the new provision set forth in § 743.6 of the EAR (Prior notifications to Congress of exports of certain semiautomatic firearms), BIS utilized a different scope. BIS's criteria required notification to Congress prior to issuance of a license for applications to export semi-automatic firearms that are: (1) controlled under ECCN 0A501.a (which was subsequently revised to 0A506 and 0A507 as described below); (2) exported to Mexico, South Africa, Turkey, or any other country not listed in Country Group A:5 or A:6 in supplement no.1 to part 740; and (3) valued at $4 million or more. Along with the notification requirement, BIS also added a paragraph to supplement no. 2 to part 748 requiring that certain information and documentation required to comply with the notification requirement be included with export applications that were subject to the notification requirement. The Firearms IFR made conforming changes to § 743.6 and supplement no. 2 to part 748 to remove the reference to 0A501.a and add in its place references to ECCN 0A506 for semi-automatic rifles and ECCN 0A507 for semi-automatic pistols; however, no changes were made to the scope of the firearms that required congressional notification under the EAR.
In this final rule, BIS is amending the EAR to remove and reserve § 743.6. Based on its experience in implementing this reporting requirement during the past three years, BIS has determined that this requirement, which is not required under ECRA and has imposed a burden on both industry and BIS, is not warranted, and it is therefore eliminated. There are other processes in place for BIS's Congressional oversight committees to request information on specific licenses. Specifically, the chairman or ranking member of committees of appropriate jurisdiction may request such information from BIS pursuant to 50 U.S.C. 4820(h)(2)(B)(i). These processes provide sufficient oversight into BIS's firearms licensing policies and procedures. Removing this notification requirement will not alter or otherwise affect the firearms licensing review process, including interagency review, and any related procedures. Additionally, this revision is in keeping with the BIS objective to reduce regulatory burdens.
This final rule makes the following EAR changes to implement the removal of the Congressional notification requirement. In part 743 (Special Reporting and Notification), this final rule removes and reserves § 743.6. In supplement no. 2 to part 748 (Unique Application and Submission Requirements), this final rule removes paragraph (aa)(1), as described in this section and section III.D, which specifies the unique application requirements tied to meeting the notification requirement under § 743.6 that is being eliminated by this final rule.
This final rule revises the CCL Category 0 heading by adding the text `firearms, ammunition' after the word `equipment' to provide a better description of the items listed in this category.
On August 13, 2018, the President signed into law the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which included the Export Control Reform Act of 2018 (ECRA), 50 U.S.C. 4801-4852. ECRA, as amended, provides the legal basis for BIS's principal authorities and serves as the authority under which BIS issues this final rule. In particular, and as noted elsewhere, Section 1753 of ECRA (50 U.S.C. 4812) authorizes the regulation of exports, reexports, and transfers (in-country) of items subject to U.S. jurisdiction. Further, Section 1754(a)(1)-(16) of ECRA (50 U.S.C. 4813(a)(1)-(16)) authorizes,
1. BIS has examined the impact of this rule as required by Executive Orders (E.O.) 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select
2. Notwithstanding any other provision of law, no person may be required to respond to or be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
• OMB Control Number 0694-0088, Simplified Network Application Processing System;
• OMB Control Number 0694-0096, Five Year Records Retention Period;
• OMB Control Number 0694-0122, Licensing Responsibilities and Enforcement;
• OMB Control Number 0694-0137,
• OMB Control Number 0607-0152, Automated Export System (AES) Program
Additional information regarding these collections of information—including all background materials—can be found at
For OMB control number 0694-0088,
For OMB control number 0694-0137,
Changes impacting OMB control numbers 0694-0096,0694-0122, and 0607-0152
3. This rule does not contain policies with federalism implications as that term is defined under Executive Order 13132.
4. Pursuant to Section 1762 of ECRA (50 U.S.C. 4821), this action is exempt from the Administrative Procedure Act (APA) (5 U.S.C. 553) requirements for notice of proposed rulemaking, opportunity for public participation, and delay in effective date.
5. Because neither the Administrative Procedure Act nor any other law requires notice of proposed rulemaking and an opportunity for public comment for this rule, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601
Administrative practice and procedure, Exports, Reporting and recordkeeping requirements.
Exports, Terrorism.
Administrative practice and procedure, Reporting and recordkeeping requirements.
Administrative practice and procedure, Exports, Reporting and recordkeeping requirements, Terrorism.
Exports.
Exports, Reporting and recordkeeping requirements.
For the reasons stated in the preamble, BIS amends 15 CFR parts 738, 740, 742, 743, 748, 750, 758, 772, and 774 as follows:
50 U.S.C. 4801-4852; 50 U.S.C. 4601
50 U.S.C. 4801-4852; 50 U.S.C. 4601
(24) [Reserved]
(b)
50 U.S.C. 4801-4852; 50 U.S.C. 4601
The revisions read as follows:
(a) * * *
(1) Crime control and detection instruments and equipment and related “technology” and “software” identified in the appropriate ECCNs on the CCL under CC Column 1 in the Country Chart column of the “License Requirements” section. A license is required to countries listed in CC Column 1 (Supplement No. 1 to part 738 of the EAR). Items affected by this requirement are identified on the CCL under the following ECCNs: 0A502 (for shotguns with a barrel length less than 24 inches and shotgun “parts” and “components”), 0A504, 0A505.b, 0A508 (for shotguns with a barrel length less than 24 inches and shotgun “parts” and “components”), 0A509.a (for items for ECCN 0A502 or ECCN 0A508), 0A509.d, 0A977, 0A978, 0A979, 0D977, 0E502, 0E505 (“technology” for “development” or for “production” of buckshot shotgun shells controlled under ECCN 0A505.b), 0E977, 1A984, 1A985, 3A980, 3A981, 3D980, 3E980, 4A003 (for fingerprint computers only), 4A980, 4D001 (for fingerprint computers only), 4D980, 4E001 (for fingerprint computers only), 4E980, 6A002 (for police-model infrared viewers only), 6E001 (for police-model infrared viewers only), 6E002 (for police-model infrared viewers only), and 9A980.
(2) Shotguns with a barrel length greater than or equal to 24 inches, identified in ECCN 0A502 or 0A508 on the CCL under CC Column 2 in the Country Chart column of the “License Requirements” section regardless of end user to countries listed in CC Column 2 (supplement no. 1 to part 738 of the EAR).
(3) Shotguns with barrel length greater than or equal to 24 inches, identified in ECCN 0A502 or 0A508 on the CCL under CC Column 3 in the Country Chart column of the “License Requirements” section only if for sale or resale to police or law enforcement entities in countries listed in CC Column 3 (supplement no. 1 to part 738 of the EAR).
(4) Items designed for the execution of human beings as identified in ECCN 0A981 require a license to all destinations including Australia, Canada, and the United Kingdom. Controls for these items appear in each ECCN; a column specific to these controls does not appear in the Country Chart (supplement no. 1 to part 738 of the EAR).
(5) Certain crime control items require a license to all destinations except Canada. These items are identified under ECCNs 0A982, 0A503, and 0E982. Controls for these items appear in each ECCN; a column specific to these controls does not appear in the Country Chart (supplement no. 1 to part 738 of the EAR).
(6) See § 742.11 of the EAR for further information on items controlled under ECCN 0A983, which require a license to all destinations, including Australia, Canada, and the United Kingdom. Controls for these items appear in each ECCN; a column specific to these controls does not appear in the Country Chart (supplement no. 1 to part 738 of the EAR).
(b) * * *
(1) Applications for items controlled under this section will generally be considered favorably on a case-by-case basis, unless there is civil disorder in the country or region or unless there is a risk that the items will be used to violate or abuse human rights. The judicious use of export controls is intended to deter human rights violations and abuses, distance the United States from such violations and abuses, and avoid contributing to civil disorder in a country or region.
(b)
50 U.S.C. 4801-4852; 50 U.S.C. 4601
50 U.S.C. 4801-4852; 50 U.S.C. 4601
The revisions read as follows:
License applications for certain firearms and related commodities require support documents in accordance with this section. For destinations that are members of the Organization of American States (OAS), an FC Import Certificate, equivalent official document, or the electronic equivalent document officially issued by the foreign government is required in accordance with paragraphs (a) through (d) of this section. For other destinations that require a firearms import certificate or permit, the firearms import certificate or permit is required in accordance with paragraph (e) of this section.
(a)
(1)
(2) * * *
(ii) [Reserved]
(3)
(b)
(2) If the government of the importing country will not issue an FC Import Certificate or its official equivalent, the applicant must supply the information described in paragraphs (c)(1) and (c)(6) through (c)(8) of this section on company letterhead.
(c)
(1) Applicant's name and address. The applicant may be either the exporter, supplier, or order party.
(2) FC Import Certificate Identifier/Number.
(3) Name of the country issuing the certificate or unique country code.
(4) Date the document was issued, in international date format (
(5) Name of the agency issuing the certificate, address, telephone and facsimile numbers, signing officer name, and signature.
(6) Name of the importer, address, telephone and facsimile numbers, country of residence, representative's name if commercial or government body, citizenship, and signature.
(7) Name of the end user(s), if known and different from the importer, address, telephone and facsimile numbers, country of residence, representative's name if commercial (authorized distributor or reseller) or government body, citizenship, and signature. Note that BIS does not require the identification of each end user when the firearms and related commodities will be resold by a distributor or reseller if unknown at the time of export.
(8) Description of the commodities approved for import including a technical description and total quantity of firearms, parts and components, ammunition and parts.
(9) Expiration date of the FC Import Certificate in international date format (
(10) Name of the country of export (
(11) Additional information. Certain countries may require the tariff classification number, by class, under the Brussels Convention (Harmonized Tariff Code) or the specific technical description of a commodity. For example, shotguns may need to be described in barrel length, overall length, number of shots, manufacturer's name and country of manufacture. The technical description is not the Export Control Classification Number (ECCN).
(d)
(2)
(3)
(aa) “
50 U.S.C. 4801-4852; 50 U.S.C. 4601
(g)
50 U.S.C. 4801-4852; 50 U.S.C. 4601
(g) * * *
(4) * * *
(ii)
50 U.S.C. 4801-4852; 50 U.S.C. 4601
50 U.S.C. 4801-4852; 50 U.S.C. 4601
a. Non-automatic and non-semi-automatic firearms equal to .50 caliber (12.7 mm) or less.
b. Non-automatic and non-semi-automatic rifles, carbines, revolvers or pistols with a caliber greater than .50 inches (12.7 mm) but less than or equal to .72 inches (18.0 mm).
c. The following types of “parts” and “components” if “specially designed” for a commodity controlled by paragraph .a or .b of this entry or ECCNs 0A506 or 0A507, or USML Category I (unless otherwise enumerated or elsewhere specified on the
d. Detachable magazines with a capacity of 17 to 50 rounds “specially designed” for a commodity controlled by paragraph .a or .b of this entry or controlled by ECCNs 0A506 or 0A507.
e. Receivers (frames) and “complete breech mechanisms,” including castings, forgings, stampings, or machined items thereof, “specially designed” for a commodity controlled by paragraph .a or .b of this entry.
f. through w. [Reserved]
x. “Parts” and “components” that are “specially designed” for a commodity classified under paragraphs .a through .c of this entry, a commodity classified under ECCNs 0A506 or 0A507, or the USML and not elsewhere specified on the USML or CCL or controlled under ECCN 0A509.
y. Specific “parts,” “components,” “accessories” and “attachments” “specially designed” for a commodity subject to control in this ECCN, ECCNs 0A506, 0A507, or common to a defense article in USML Category I and not elsewhere specified in the USML or CCL as follows, and “parts,” “components,” “accessories,” and “attachments” “specially designed” therefor.
y.1. Stocks (including adjustable, collapsible, blades and braces), grips, handguards, or forends, that do not contain any fire control “parts” or “components” (
y.2 through y.5. [Reserved]
y.6. Bayonets; and
y.7. Firearms manufactured from 1890 to 1898 and reproductions thereof.
a. Telescopic sights.
b. Holographic sights.
c. Reflex or “red dot” sights.
d. Reticle sights.
e. Other sighting devices that contain optical elements.
f. Laser aiming devices or laser illuminators “specially designed” for use on firearms, and having an operational wavelength exceeding 400 nm but not exceeding 710 nm.
g. Lenses, other optical elements and adjustment mechanisms for articles in paragraphs .a, .b, .c, .d, .e, or .i.
h. [Reserved]
i. Riflescopes that were not “subject to the EAR” as of March 8, 2020 and are “specially designed” for use in firearms that are “subject to the ITAR.”
a. Ammunition for firearms controlled by ECCNs 0A501, 0A506, or 0A507 or USML Category I and not enumerated in paragraph .b, .c, or .d of this entry or described in USML Category III.
b. Buckshot (No. 4 .24” diameter and larger, any material) shotgun shells and shotgun shells that contain only buckshot, or are for the dispersion of chemical irritants.
c. Shotgun shells (including less than lethal rounds) that do not contain buckshot; and “specially designed” “parts” and “components” of shotgun shells.
d. Blank ammunition for firearms controlled by ECCNs 0A501, 0A502, 0A506, 0A507, or 0A508 and not described in USML Category III.
e. through w. [Reserved]
x. “Parts” and “components” that are “specially designed” for a commodity subject to control in this ECCN or a defense article in USML Category III and not elsewhere specified on the USML or the CCL.
a. Semi-automatic centerfire (non-rimfire) rifles equal to .50 caliber (12.7 mm) or less.
b. Semi-automatic rimfire rifles equal to .50 caliber (12.7 mm) or less.
a. Semi-automatic centerfire (non-rimfire) pistols equal to .50 caliber (12.7 mm) or less.
b. Semi-automatic rimfire pistols equal to .50 caliber (12.7 mm) or less.
a. Semi-automatic centerfire (non-rimfire) shotguns.
b. Semi-automatic rimfire shotguns.
a. Any “part,” “component,” device, “attachment,” or “accessory” not elsewhere specified on the USML that is designed or functions to convert a non-semi-automatic firearm controlled by 0A501 or 0A502 to semi-automatic or to accelerate the rate of fire of a semi-automatic firearm controlled by 0A506, 0A507, or 0A508.
b. Receivers (frames), including castings, forgings, stampings, or machined items thereof, “specially designed” for an item controlled by ECCN 0A506.
c. Receivers (frames), including castings, forgings, stampings, or machined items thereof, “specially designed” for an item controlled by ECCN 0A507.
d. Receivers (frames) and “specially designed” “complete breech mechanisms” for a commodity controlled by ECCN 0A508.
a. “Technology” “required” for the “development” or “production” of commodities controlled by ECCN 0A501 (other than 0A501.y), 0A506, 0A507, 0A509, or 0B501.
b. “Technology” “required” for the operation, installation, maintenance, repair, or overhaul of commodities controlled by ECCN 0A501 (other than 0A501.y), 0A506, 0A507, 0A509, or 0B501.
Bureau of Industry and Security, Department of Commerce.
Interim final rule.
In this interim final rule (IFR), the Bureau of Industry and Security (BIS) amends the Export Administration Regulations (EAR) to address diversion concerns involving entities on the Entity List and certain other restricted end users. Under this IFR, any entity that is at least 50 percent owned by one or more entities on the Entity List will itself automatically be subject to Entity List restrictions. This is a marked improvement over the current standard, which excludes all entities that are not specifically included on the Entity List, regardless of affiliation with Entity List entities. This IFR similarly applies restrictions to entities at least 50 percent owned by listed `military end users' and certain sanctioned parties. The 50 percent ownership standard in this IFR is designed to be consistent with longstanding Department of the Treasury practice, so as to limit the additional burden on the business community.
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•
•
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Comments on this rule may be submitted to the Federal rulemaking portal at:
All filers using the portal should use the name of the person or entity submitting the comments as the name of their files, in accordance with the instructions below. Anyone submitting business confidential information should clearly identify the business confidential portion at the time of submission, file a statement justifying nondisclosure and referring to the specific legal authority claimed, and provide a non-confidential version of the submission.
For comments submitted electronically containing business confidential information, the file name of the business confidential version should begin with the characters “BC.” Any page containing business confidential information must be clearly marked “BUSINESS CONFIDENTIAL” on the top of that page. The corresponding non-confidential version of those comments must be clearly marked “PUBLIC.” The file name of the non-confidential version should begin with the character “P.” Any submissions with file names that do not begin with either a “BC” or a “P” will be assumed to be public and will be made publicly available at:
Chair, End-User Review Committee, Office of the Assistant Secretary for Export Administration, Bureau of Industry and Security, Department of Commerce, Phone: (202) 482-5991, Email:
The Entity List (supplement no. 4 to part 744 of the EAR (15 CFR parts 730-774)) identifies entities for which there is reasonable cause to believe, based on specific and articulable facts, that the entities have been involved, are involved, or pose a significant risk of being or becoming involved in activities contrary to the national security or foreign policy interests of the United States, pursuant to § 744.11. The EAR impose additional license requirements on, and limit the availability of most license exceptions for, exports, reexports, and transfers (in-country) when a listed entity is a party to the transaction. The license review policy for each listed entity is identified in the “License Review Policy” column on the Entity List, and the impact on the availability of license exceptions is described in the relevant
The End-User Review Committee (ERC), composed of representatives of the Departments of Commerce (Chair), Defense, Energy, State and, where appropriate, the Treasury, generally makes decisions regarding additions to, removals from, or other modifications to the Entity List. The ERC makes decisions to add an entry to the Entity List by majority vote and makes
Prior to this IFR, BIS used a `legally distinct' standard for applying restrictions to subsidiaries and other foreign affiliates of entities identified on the Entity List. Under this standard, Entity List restrictions for listed entities have extended to the foreign entity listed on the Entity List, as well as any related foreign entity located in that same country that is not legally distinct from the listed foreign entity. For example, a branch of a listed entity, even if operating under a different name, was considered to be subject to Entity List restrictions, because the branch is not legally distinct from the listed entity. Conversely, the Entity List requirements for a listed entity did not extend to a foreign affiliate owned by a listed entity that was legally distinct from the listed entity, unless BIS separately listed that legally distinct foreign affiliate on the Entity List.
BIS is concerned that the old approach can enable diversionary schemes, such as the creation of new foreign companies to evade Entity List restrictions. Creation of such companies may allow listed entities to deceive exporters, reexporters, and transferors into providing items in violation of the Entity List restrictions that apply to the listed entities. Furthermore, the old approach required BIS to expend substantial efforts to address the tactics that listed entities would adopt to circumvent their placement on the Entity List. BIS frequently published additional final rules to identify legally distinct foreign affiliates of listed entities that also warranted being listed on the Entity List. Even with these additions, there remained a risk that entities would create additional non-listed foreign companies to try to circumvent the intent of the controls. The creation of such new foreign companies would in turn require BIS to devote significant additional time and resources to issuing rules adding them to the Entity List. With this IFR, BIS is reducing future piecemeal regulatory activity to expand Entity List restrictions.
Because of such diversion concerns, BIS has determined that to protect U.S. national security and foreign policy interests, the Entity List restrictions should also extend to certain foreign companies that are subsidiaries or other foreign affiliates owned by listed entities.
The Department of the Treasury's Office of Foreign Assets Control (OFAC) uses a 50 percent ownership rule in connection with the Specially Designed Nationals and Blocked Persons List (SDN List) and may also apply the 50 percent rule when issuing other sanctions prohibitions, including less than full blocking restrictions. Sanctions maintained by OFAC prohibit all transactions by U.S. persons, wherever they are located, or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons, unless authorized by a general or specific license issued by OFAC or exempt under OFAC's regulations. All property and interests in property of blocked persons that are in the United States or in the possession or control of U.S. persons may not be transferred or otherwise dealt in and must be reported to OFAC. Under the 50 percent rule, entities which are owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more blocked persons are generally considered blocked, regardless of whether such entities are specifically added to the SDN List.
OFAC's 50 percent rule addresses, among other objectives, threats of circumvention through unlisted subsidiaries while reducing the administrative burden associated with adding subsidiaries to the SDN List. Similar to OFAC, BIS in this IFR is applying the 50 percent rule under the EAR to address diversionary/circumvention tactics/risks (as described in section I.B.1) and address interest in reducing administrative burdens. BIS has determined that applying the 50 percent rule under the EAR (which BIS refers to as the Affiliates rule) will reduce the need to publish additional final rules to add entities to the Entity List and more broadly and effectively impose license requirements for exports, reexports, and transfers (in-country) to or involving entities that pose a significant risk of being or becoming involved in activities that are contrary to the national security or foreign policy interests of the United States.
BIS recognizes that its own application of the Affiliates rule may require additional analysis by the private sector (
There are various private sector screening resources for companies that may help to mitigate this challenge, including vendors that conduct 50 percent ownership analysis already as part of their OFAC compliance screening programs. OFAC also provides guidance regarding certain entities that may be blocked pursuant to the 50 percent rule to facilitate compliance, though this does not replace the need for independent compliance screening or due diligence. BIS may follow OFAC's practice of providing guidance regarding certain entities that may be subject to the Affiliates rule to facilitate compliance. To further support compliance, BIS may in certain circumstances add those additional entities to the Entity List.
The Entity List has increasingly become a vital tool to protect U.S. national security and foreign policy interests. The Entity List was originally added to the EAR on February 3, 1997, to address nuclear proliferation concerns (62 FR 4910). The scope of the Entity List has been broadened over the years,
BIS, in consultation with the Departments of Defense, Energy, State, and the Treasury, is adopting for the Entity List the 50 percent rule that OFAC has used for many years for the SDN List, which for EAR purposes will be referred to as the Affiliates rule. Adopting the same standard that exporters, reexporters, and transferors have already been using in their OFAC compliance programs will likely ease the burden in adopting the new standard for Entity List compliance, as compared with a distinct standard that applies a lower ownership threshold. Additionally, this IFR does not constrain the ERC's ability to add an affiliated entity that is under the 50 percent threshold when the ERC has reasonable cause to believe, based on specific and articulable facts, that the foreign entity has been involved, is involved, or poses a significant risk of being or becoming involved in activities contrary to the national security or foreign policy interests of the United States, pursuant to § 744.11(b). Even so, BIS welcomes comments on whether the 50 percent ownership threshold should be lower.
For the same reasons as noted above, BIS, in consultation with the Departments of Defense, Energy, State, and the Treasury, is also adopting the Affiliates rule at this time for the `Military End-User' (MEU) List in supplement no. 7 to part 744. Extending the Affiliates rule to the MEU List is consistent with prior BIS proposals to align the MEU List and the Entity List, including by potentially merging the two lists and expanding license requirements for MEUs, that are under review (see the July 29, 2024 proposed rule,
BIS is also informing the public that foreign parties with significant minority ownership by, or other significant ties to (
Exporters, reexporters, and transferors are responsible for compliance with the BIS Affiliates rule and can be held liable for unauthorized exports, reexports, or transfers (in-country) on a strict liability basis, so due diligence must be conducted to determine whether a foreign entity is an entity that is owned by one or more listed entities. The application of the Affiliates rule creates an affirmative duty to determine the ownership of other parties to the transaction in order to comply. As with any export transaction, other parties,
BIS is not adopting the Affiliates rule at this time for certain other EAR restricted parties list or provisions, specifically, the Unverified List (UVL) in supplement no. 6 to part 744, or the list of parties subject to Denial Orders issued under part 764. Extending the Affiliates rule to UVL entities is not warranted because subsidiaries or other foreign affiliates of these listed entities may not meet the standard set forth in § 744.15, that is receipt of items subject to the EAR with respect to which BIS could not conduct a successful end-use check for reasons that are outside of the U.S. government's control. BIS is also not extending the Affiliates rule to persons subject to Denial Orders as there is a separate related persons process under § 766.23 pursuant to which BIS provides persons with notice of contemplated action and an opportunity to respond. BIS welcomes public comments in response to this IFR on whether BIS should extend the Affiliates rule to these other EAR end-user lists, as well as on any other aspect of this IFR.
As discussed above, BIS, in consultation with the Departments of Defense, Energy, State, and the Treasury, has determined the existing Entity List restrictions for all existing entries on the Entity List, including any new entities that will be added to the Entity List in future rulemakings, extend to any foreign entity that is owned by 50 percent or more by one or more listed entities. The ERC may apply exceptions to the Affiliates rule on a case-by-case basis if it determines that the foreign affiliates owned by a particular listed entity, or one specific foreign entity owned by a listed entity, do not pose a significant risk of being or becoming involved in diversion to the listed entity by approving additions or modifications
To effectuate the changes described above, in particular, adopting the Affiliates rule, BIS is amending part 744, as well as making conforming changes to parts 732, 734, 736, and 748 of the EAR (15 CFR parts 730-744). The four sets of changes this IFR makes are described in section II as follows:
1. Adoption of the Affiliates rule for the Entity List;
2. Adoption of the Affiliates rule for the MEU List;
3. Adoption of the Affiliates rule for § 744.8; and
4. Other conforming changes.
This IFR amends the Entity List in supplement no. 4 to part 744, by revising the introductory text to the supplement. This IFR adds a new fourth sentence to specify that the Entity List license requirements and other Entity List restrictions also apply to any foreign entity that is owned 50 percent or more by one or more listed entities or entities that are subject to restrictions based upon their ownership. This IFR adds a new fifth sentence to specify the rule of most restrictiveness, which as used in §§ 744.8, 744.11, 744.21, and supplements nos. 4, 7, and 8 to part 744 of the EAR, means an entity owned 50 percent or more, directly or indirectly, by multiple entities subject to EAR license requirements pursuant to some combination of the Entity List, MEU List, or SDN List designated under programs listed in § 744.8(a)(1), is subject to the most restrictive license requirements, license exception eligibility, and license review policy applicable to one or more of its owners under the EAR. This IFR also adds a new sixth sentence to specify that if an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity owned, directly or indirectly, by one or more listed entities, they must resolve new Red Flag 29, obtain a license from BIS, or identify an applicable license exception prior to proceeding with the export, reexport, or transfer (in-country) and includes a cross reference to new Red Flag 29 in supplement no. 3 to part 732 that this IFR adds. Lastly, this IFR adds the phrase “and other Entity List restrictions” after the reference to “license requirements” in the first sentence of the introductory text to clarify that listed entities are subject to restrictions on license exception availability and the license review policy stated in the listing, as well as the indicated license requirements.
In § 744.11 (License requirements that apply to entities acting or at significant risk of acting contrary to the national security or foreign policy interests of the United States), this IFR adds paragraph (a)(1) (Entity List entries extend to other foreign affiliates of listed entities owned 50 percent or more by one or more listed entities or unlisted entities that are subject to ownership-related restrictions) to specify that the Entity List license requirements and other Entity List restrictions also apply to any foreign entity that is owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more listed entities or unlisted entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership. This revision is made because of the diversion concern to listed entities. Paragraph (a) specifies the rule of most restrictiveness, as described under section II.A.1 of this IFR also applies to the Entity List. Paragraph (a)(1) also specifies that if an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity owned, directly or indirectly, by one or more listed entities on the Entity List, they must resolve the Red Flag or obtain a license from BIS prior to proceeding with the export, reexport, or transfer (in-country), unless a license exception is available. Paragraph (a)(1) also includes a cross reference to new Red Flag 29 that this IFR adds to supplement no. 3 to part 732. Lastly, paragraph (a)(1) also specifies that the Entity List license requirements and other Entity List restrictions do not apply to foreign affiliates of listed entities that are owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more entities that are operating at an address listed on the Entity List if the entities operating at that address are not specifically identified on the Entity List. BIS notes that these addresses pose diversion concerns such as through the operation of corporate secretarial services companies or logistics companies associated with high volumes of diversion, but that entities located at a different address with a parent company registered at a corporate services address on the Entity List may not present the same diversion risks.
For any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more entities with different Entity List license requirements, the most restrictive of those Entity List license requirements apply to that foreign entity. For any foreign entity that is an entity owned, directly or indirectly, by a listed entity where ownership percentage cannot be determined, the most restrictive Entity List license requirements applicable to the listed entity apply to that foreign entity. If BIS is able to make a determination during the license review process that the foreign entity is in fact not owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities or entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership, the license application will be returned without action to the applicant noting that a license is not required. In such cases, BIS may consider issuing guidance, as appropriate, in the form of a frequently asked question on the BIS website to advise other exporters of such determination.
Application example 1:
• Company A is listed on the Entity List and requires a license for all items subject to the EAR and has a presumption of denial license review policy. Company A owns 35 percent of Company C. Company C is not listed on the Entity List.
• Company B is listed on the Entity List and requires a license for any item on the CCL and has a case-by-case license review policy. Company B owns 15 percent of Company C.
• Company C is owned directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities (
• Company D is owned 50 percent by Company C. Because Company D is owned, directly or indirectly, individually or in the aggregate, 50 percent or more by an unlisted entity (Company C) that is subject to Entity List license requirements or other Entity List restrictions based upon its ownership, the Entity List license requirements that are applicable to Company D are the same as if the item was being exported, reexported, or transferred (in-country) to its owner(s) listed on the Entity List. Assuming Company D has no direct or indirect ownership by other listed parties that are subject to more restrictive license requirements and other restrictions, the Entity List license requirements and license review policy for Company C would be followed for any transaction where Company D is a party to the transaction.
BIS estimates that these changes described in section II.A.1 and .2 will result in an additional 170 license applications submitted to BIS annually.
In § 734.9 (Foreign-Direct Product (FDP) Rules), this IFR as a conforming change adds three sentences to the end of paragraph (e) (Entity List FDP rules), to specify that consistent with the revised introductory text to the Entity List (see supp. no. 4 to part 744), the end-user scope of the Entity List FDP rules includes any foreign entity that is owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more listed entities or unlisted entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership, including at least one entity within the end-user scope of the provision. This IFR adds a second sentence to specify that these requirements apply to all entities on the Entity List with a footnote referenced under this paragraph (e). This IFR adds a final sentence stating that if the foreign entity is owned 50 percent or more by one or more listed entities or unlisted entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership, including at least one entity within the end-user scope, these Entity List FDP requirements are applicable, even when only one of the owners meets the end-user criteria under paragraph (e).
For the same reason, this IFR adds two sentences to the end of paragraph (g) to specify that consistent with the revised introductory text to the Entity List in supplement no. 4 to part 744, the end-user scope of the Russia/Belarus-Military End User and Procurement FDP rule also includes any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities or unlisted entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership, including at least one entity that meets the end-user scope of paragraph (g). As in paragraph (e), this IFR adds an additional sentence to the end of paragraph (g) to provide application guidance for these criteria.
Application example 2 for FDP application:
• Company E is listed on the Entity List with a footnote 3 designation, which means foreign-produced items that meet the criteria in § 734.9(g) (Russia/Belarus-Military End User and Procurement FDP rule) are subject to the EAR and require a license to this entity. Company E owns 35 percent of Company G.
• Company F is listed on the Entity List with a footnote 1 designation, which means foreign-produced items that meet the criteria in § 734.9(e)(1) (
• Company G is owned directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities (
• In determining the scope of foreign-produced items subject to the EAR that require a license to Company G, both the criteria under §§ 734.9(e)(1) and (g) (
BIS estimates that these changes to § 734.9 will result in an additional five license applications submitted to BIS annually.
In § 744.16 (Entity List) this IFR revises paragraph (e) (Removal or modification requests) to add a new second sentence to specify that any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more entities listed on the Entity List or by entities subject to Entity List license requirements or other Entity List restrictions based upon their ownership, may request that its Entity List owner's entry listing be modified to exclude the requester.
BIS estimates that these changes to § 744.16(e) will result in an additional 30 appeals submitted to BIS annually.
In § 748.8 (Unique application and submission requirements), this IFR adds a new paragraph (a)(a) to reference a new paragraph (c)(c) (Affiliates rule entities) added to supplement no. 2 to part 748—Unique Application and Submission Requirements. New paragraph (c)(c) specifies that in order to request a license for an export, reexport, or transfer (in-country) for any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more entities listed on the Entity List in supplement no. 4 to part 744, MEU List in supplement no. 7 to part 744, or by one or more SDNs designated under programs listed in § 744.8(a)(1), or for an
BIS estimates that this addition of paragraph (c)(c) to supplement no. 2 to part 748 and the addition of § 748.8(a)(a) will not result in any additional license applications submitted to BIS annually because these two new paragraphs are limited to providing guidance on how to submit such license applications. The overall annual increase in license applications associated with this IFR has already been estimated and accounted for elsewhere in this IFR.
This IFR amends the MEU List in supplement no. 7 to part 744, by revising the introductory text to add a new fourth sentence to specify that the MEU List license requirements and other MEU restrictions also apply to any foreign entity that is owned 50 percent or more by one or more listed entities or entities that are subject to restrictions based upon their ownership. This IFR adds a new fifth sentence to specify that the rule of most restrictiveness, as described under section II.A.1 of this IFR, also applies to the MEU List. This IFR also adds a new sixth sentence to specify that if an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity owned, directly or indirectly, by one or more listed entities, they must resolve the Red Flag or obtain a license from BIS prior to proceeding with the export, reexport, or transfer (in-country), unless a license exception is available.
In § 744.21 (Restrictions on certain `military end uses' or `military end users'), this IFR adds paragraph (a)(3) to specify that the MEU List and Entity List license requirements in § 744.21(a)(1) and (2) also apply to any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities or entities subject to Entity List or MEU List restrictions based upon their ownership. Paragraph (a)(3) specifies the rule of most restrictiveness, as described under section II.A.1 of this IFR, also applies to the MEU List. Paragraph (a)(3) also specifies that if an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign affiliate that is an entity owned, directly or indirectly, by one or more listed entities, they must resolve the Red Flag or obtain a license from BIS prior to proceeding with the export, reexport, or transfer (in-country), unless a license exception is available. Paragraph (a)(3) also includes a cross reference to new Red Flag 29 that this IFR adds to supplement no. 3 to part 732. For any foreign affiliate that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities with different MEU List or Entity List license requirements, the most restrictive MEU List or Entity List license requirements apply to that foreign entity. For any foreign entity where the exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity owned, directly or indirectly, by one or more listed entities, they must submit a license application to BIS.
Paragraph (a)(3) further specifies that the license requirements in paragraphs (a)(1) and (2) do not apply to unlisted foreign affiliates that are owned, directly or indirectly, individually or in the aggregate, solely by one or more unlisted `military end users,' unless the unlisted foreign affiliate itself meets the definition of a `military end user.' BIS has included this text to clarify that the affiliates rule does not extend the license requirements of § 744.21 to unlisted foreign affiliates when there is no direct or indirect ownership by a listed MEU or Entity Listed party with a footnote 3 designation.
BIS estimates that these changes described in section II.B.1 and .2 will result in an additional 30 license applications submitted to BIS annually.
In § 744.21, this IFR also revises paragraph (b)(2) (Requests for removal from or modification of `Military End User' (MEU) List and Entity List) introductory text, to specify that any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more entities listed on the MEU List or the Entity List or subject to MEU List or Entity List restrictions based upon their ownership, may request that its MEU List or Entity List owner's entry listing be modified to exclude the requester.
BIS estimates that these changes to § 744.21(b)(2) will result in an additional 5 appeals submitted to BIS annually.
The U.S. Government has a number of list-based tools to restrict economic activities of individuals and entities to protect U.S. national security or foreign policy interests. BIS employs end-user controls under the EAR, including the Entity List, to impose license requirements for the export, reexport, and transfer (in-country) of items subject to the EAR. End-user requirements and Entity List additions allow for the monitoring of items subject to the EAR, including less-sensitive items.
OFAC maintains the SDN List to identify persons whose property or interests in property that are within the United States or in the possession or control of U.S. persons, wherever located, are blocked (see appendix A to 31 CFR chapter V and
Under § 744.8, BIS implements additional EAR license requirements for all items subject to the EAR for all persons blocked under specified OFAC-administered sanctions programs identified under this section. The EAR restrictions under § 744.8 involving these OFAC-administered sanctions programs serve as a force multiplier and complement OFAC's blocking sanctions, which prohibit all transactions by U.S. persons, wherever they are located, or persons within (or transiting) the United States that involve any property or interests in property of designated or blocked persons, unless authorized by a general or specific license issued by OFAC or exempt under OFAC's regulations. The imposition of these EAR license requirements for exports, reexports, and transfers (in-country) allows for the EAR controls to act as a backstop for activities over which OFAC does not exercise jurisdiction, including certain situations involving deemed exports and deemed reexports, and for reexports and transfers (in-country) that would otherwise not involve U.S. persons (
In § 744.8 (Restrictions on exports, reexports, and transfers (in-country) when certain persons designated on the SDN List are a party to the transaction), this IFR revises paragraph (a)(2) to add a new second sentence that specifies that these EAR controls described under this section also apply to any entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more persons blocked under one of the specific programs identified under § 744.8(a)(1), which is needed to address diversion concerns to entities blocked as a result of these SDN designations. Paragraph (b), which states the licensing requirement applicable when an SDN designated under the programs identified in paragraph (a)(1) is a party to the transaction, is revised to clarify that the same restrictions apply regardless of how a party is blocked (
These restrictions are consistent with OFAC regulations, but in the event of a discrepancy exporters, reexporters, and transferors must follow the rule stated here. Because of the close relation between OFAC's SDN List and this section, the public asked BIS in 2024 after § 744.8 was added to the EAR in the final rule, “End-User Controls: Imposition of Restrictions on Certain Persons Identified on the List of Specially Designated Nationals and Blocked Persons (SDN List)” published March 21, 2024 (89 FR 20107), whether BIS was using the legally distinct standard or the OFAC 50 percent ownership rule, and BIS provided regulatory guidance to exporters, reexporters, and transferors that BIS was using the legally distinct standard. However, because BIS is now adopting the Affiliates rule for the Entity List and MEU List, BIS has also determined it is warranted to also use the 50 percent ownership standard for the § 744.8 requirements to protect U.S. national security and foreign policy interests and to reflect the close relationship with OFAC for purposes of this section. This IFR also adds a new third sentence that specifies the rule of most restrictiveness, as described under section II.A.1 of this IFR also applies to SDNs listed under one of the specific programs identified under § 744.8(a)(1). As discussed above, this IFR neither constrains the ERC's ability to add a foreign entity that falls below the 50 percent threshold nor to exclude an entity that is owned 50 percent or more by one or more listed entities.
BIS estimates that these changes to § 744.8 will result in an additional 55 license applications submitted to BIS annually.
In Supplement No. 1 to Part 736—General Orders, this IFR adds a new Temporary General License, Non-listed foreign affiliates of listed entities under paragraph (g). This IFR adds paragraph (g)(1) (Authorization), which specifies that this TGL authorizes: (i) exports, reexports, or transfers (in-country) to or within any destination in Country Group A:5 or A:6 (supplement no. 1 to part 740) when a non-listed foreign entity that is owned 50 percent or more, individually or in aggregate, by one or more listed entities on the Entity List (supplement no. 4 to part 744) or Military End-User (MEU) List (supplement no. 7 to part 744), or by unlisted entities that are subject to Entity List or MEU license requirements or other Entity List or MEU restrictions based upon their ownership, is a party to the transaction; and (ii) exports, reexports, or transfers (in-country) to or within any country other than Country Group E:1 or E:2 when a party to the transaction is a non-listed foreign affiliate of a listed entity that is owned 50 percent or more, directly or indirectly, individually or in the aggregate, by one or more listed entities on the Entity List or Military End-User (MEU) List, or by unlisted entities that are subject to Entity List or MEU license requirements or other Entity List or MEU restrictions based upon their ownership; and such party to the transaction is a joint venture with a non-listed entity headquartered in the United States or Country Group A:5 or A:6 that is not owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more listed entities on the Entity List or MEU List or by unlisted entities that are subject to Entity List or MEU license requirements or other Entity List or MEU restrictions based upon their ownership. This TGL may only be utilized to overcome the license requirements described in §§ 744.11 and 744.21 of the EAR applicable to the non-listed foreign affiliate to which this TGL applies. Paragraph (g)(2) specifies that persons must comply with all provisions of the EAR, including any applicable additional license requirements.
This IFR adds paragraph (g)(3) (Validity date) to specify that this TGL—Non-listed foreign affiliates of listed entities under paragraph (g) expires on December 1, 2025.
Lastly, this IFR adds paragraph (g)(4) (Recordkeeping requirement) to specify that all exports, reexports, transfers (in-country), and exports from abroad exported, reexported, or transferred (in-country) under the authorization of this TGL are subject to the recordkeeping requirements of part 762 of the EAR.
BIS estimates that these changes described in section II.D.1 will result in a reduction of 10 license applications submitted to BIS in the first year this rule is in effect.
This IFR adds Supplement No. 8 to Part 744—Guidelines for Applying
Paragraph (a) (Scope) identifies the general scope of these guidelines relating to the status of entities owned by individuals or entities identified on the Entity List, `Military End-User' (MEU) List, or the SDN List under a program identified in § 744.8(a)(1). Paragraph (a) also specifies that this supplement sets forth guidelines with respect to foreign affiliates of listed entities owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more listed entities on the Entity List in supplement no. 4 to this partor the MEU List in supplement no. 7 to part 744, by SDNs designated under programs identified in § 744.8(a)(1), or by unlisted entities that are subject to Entity List or MEU license requirements or other Entity List or MEU restrictions based upon their ownership, as well as addressing scenarios when an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity, directly or indirectly, owned by one or more listed entities on the Entity List or the MEU List. These foreign affiliates of listed entities are a diversion concern and therefore the Entity List license requirements and MEU List license requirements and other restrictions also extend to transactions involving these other foreign affiliates of listed entities.
Paragraph (b) (Application of 50 percent ownership rule) provides guidance on how to apply the Affiliates rule, including providing a rationale for why these criteria are used. Paragraph (b) specifies that any foreign entity that is owned 50 percent or more by one or more entities listed on the Entity List or MEU List, or by SDNs designated under one of the programs identified in § 744.8(a)(1), or by one or more entities subject to restrictions based upon their ownership, is considered to be a diversion concern to such listed entities or SDNs that own the foreign entity. Because of this diversion concern, a license is required for any transaction where that foreign entity that is owned 50 percent or more, directly or indirectly, by one or more entities is a party to the transaction to the same degree as if the item was being exported, reexported, or transferred (in-country) to a party on the Entity List, MEU List, or SDN List under a program identified in § 744.8(a)(1). This means that any foreign entity owned 50 percent or more by one or more entities on the Entity List or MEU List, or by SDNs designated under programs identified in § 744.8(a)(1), is itself considered to be subject to the license requirements of the Entity List or subject to the requirements under § 744.8, respectively. Paragraph (b) also specifies the rule of most restrictiveness, as described under section II.A.1 of this IFR also applies to entities on the Entity List, or MEU List, or SDN List. Paragraph (b) also specifies that if an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity owned, directly or indirectly, by one or more listed entities on the Entity List or the MEU List, they must resolve the Red Flag or obtain a license from BIS prior to proceeding with the export, reexport, or transfer (in-country), unless a license exception is available.
Paragraph (c) (Due diligence for foreign entities with less than 50 percent ownership by listed entities or SDNs or for parent entities of listed entities) alerts exporters, reexporters, and transferors to act with caution when considering a transaction with a non-Entity List, non-MEU List, or non-§ 744.8 foreign entity in which one or more entities identified on the Entity List, MEU List, or SDN List under a program identified in § 744.8 has a significant ownership interest that is less than 50 percent or for parent entities of listed entities. These foreign affiliates of listed entities may not necessarily raise the same diversion concern that warrants the listed entities license requirements and other Entity List and MEU List restrictions extending to these foreign affiliates of listed entities, but additional due diligence is warranted by exporters, reexporters, and transferors because of the minority ownership by listed entities in these foreign affiliates of listed entities and the opaque ownership structures and limited access to accurate ownership data in certain jurisdictions.
BIS estimates that this addition of supplement no. 8 to part 744 will not result in any additional license applications submitted to BIS annually because this supplement is limited to providing guidance, and the annual increase has already been estimated and accounted for in the other changes included in this IFR.
In supplement no. 3 to part 732—BIS's “Know Your Customer” Guidance and Red Flags, this IFR adds one new Red Flag that is intended to provide additional compliance guidance to assist exporters, reexporters, and transferors as part of their compliance programs for applying the Affiliates rule. New Red Flag 29 identifies a scenario where an exporter, reexporter, or transferor has “knowledge” that a foreign entity has one or more owners that are listed on the Entity List or the MEU List, or that are unlisted entities that are subject to license requirements or other restrictions based upon their ownership. New Red Flag 29 specifies that such exporters, reexporters, or transferors have an affirmative duty to determine the percentage of ownership of those listed entities and if that is not possible, to obtain a license from BIS if required under the Entity List or MEU List based on the requirements for the listed owner or owners of that foreign entity, unless a license exception is available.
BIS also provides this Table 1 in the preamble of this IFR to assist understanding of the changes being made in this IFR.
For the changes being made in this IFR, shipments of items removed from eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR) as a result of this regulatory action that were en route aboard a carrier to a port of export, reexport, or transfer (in-country), on September 29, 2025, pursuant to actual orders for export, reexport, or transfer (in-country) to or within a foreign destination, may proceed to that destination under the previous eligibility for a License Exception or export, reexport, or transfer (in-country) without a license (NLR), provided the export, reexport, or transfer (in-country) is completed no later than on October 29, 2025.
On August 13, 2018, the President signed into law the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which included ECRA (codified, as amended, at 50 U.S.C. 4801-4852). ECRA provides the legal basis for BIS's principal authorities and serves as the authority under which BIS issues this rule. In particular, and as noted elsewhere, Section 1753 of ECRA (50 U.S.C. 4812) authorizes the regulation of exports, reexports, and transfers (in-country) of items subject to U.S. jurisdiction. Further, Section 1754(a)(1)-(16) of ECRA (50 U.S.C. 4813(a)(1)-(16)) authorizes,
1. BIS has examined the impact of this rule as required by Executive Orders (E.O.) 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (
2. Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
• 0694-0088, “Simple Network Application Process and Multipurpose Application Form,” which carries a burden hour estimate of 29.4 minutes for a manual or electronic submission;
• 0694-0096 “Five Year Records Retention Period,” which carries a burden hour estimate of less than 1 minute;
• 0607-0152 “Automated Export System (AES) Program,” which carries a burden hour estimate of 3 minutes per electronic submission; and
• 0694-0134 “Procedure for parties on the Entity List or the Unverified List to Request Removal or Modification of their Listing,” which carries a burden hour estimate of 15 hours per electronic submission.
BIS estimates that these changes to the Entity List and related provisions and to § 744.8 under the EAR will result in an additional 245 license applications submitted annually to BIS under OMB Control Number 0694-0088 and the changes to § 744.16(e) will result in an additional 35 appeals submitted annually to BIS under OMB Control Number 0694-0134. However, the additional burden falls within the existing estimates currently associated with these control numbers. Additional information regarding these collections
3. This rule does not contain policies with Federalism implications as that term is defined under E.O. 13132.
4. Pursuant to section 1762 of ECRA (50 U.S.C. 4821), this action is exempt from the Administrative Procedure Act (APA) (5 U.S.C. 553) requirements for notice of proposed rulemaking, opportunity for public participation, and delay in effective date.
5. Because neither the APA nor any other law requires that notice of proposed rulemaking and an opportunity for public comment be given for this rule, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601
Administrative practice and procedure, Exports, Reporting and recordkeeping requirements.
Administrative practice and procedure, Exports, Inventions and patents, Research, Science and technology.
Exports.
Exports, Reporting and recordkeeping requirements, Terrorism.
Accordingly, parts 732, 734, 736, 744, and 748 of the Export Administration Regulations (15 CFR parts 730 through 774) are amended as follows:
50 U.S.C. 4801-4852; 50 U.S.C. 4601
(b) * * *
29. When an exporter, reexporter, or transferor has “knowledge” that a foreign entity that is a party to the transaction has one or more owners that are listed on the Entity List or the MEU List, or that are unlisted entities that are subject to license requirements or other restrictions based upon their ownership, it has an affirmative duty to determine the percentage of ownership by those entities and if that is not possible, to obtain a license from BIS if required under the Entity List or MEU List based on the requirements for the owner or owners of that foreign entity, unless a license exception is available.
50 U.S.C. 4801-4852; 50 U.S.C. 4601
The additions read as follows:
(e) * * * Consistent with the introductory text to the Entity List in supplement no. 4 to part 744, the end-user scope of the Entity List FDP rules also includes any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities or unlisted entities that are subject to license requirements or other restrictions based upon their ownership, including at least one entity that meets the end-user scope under this provision. This end-user scope applies to all entities on the Entity List with a footnote referenced under this paragraph (e). If the foreign entity is owned 50 percent or more by one or more listed entities or unlisted entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership, including at least one entity with a footnote referenced under this paragraph (e), these Entity List FDP requirements are applicable, even when only one of the owners meets the end-user criteria under this paragraph (e).
(g) * * * Consistent with the introductory text to the Entity List in supplement no. 4 to part 744, the end-user scope of the Russia/Belarus-Military End User and Procurement FDP rule also includes any foreign entity that is owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more listed entities or unlisted entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership, including at least one entity that meets the end-user scope of this provision. If the foreign entity is owned 50 percent or more by one or more listed entities or unlisted entities that are subject to Entity List license requirements or other Entity List restrictions based upon their ownership, including at least one entity within the end-user scope defined by paragraph (g)(2) of this section, these Russia/Belarus-Military End User and Procurement FDP requirements are applicable, even when only one of the owners meets the end-user criteria under paragraph (g)(2) of this section.
50 U.S.C. 4801-4852; 50 U.S.C. 4601
The addition reads as follows:
(g)
(1)
(i) to or within any destination in Country Group A: 5 or A:6 (supplement no. 1 to part 740) when a party to the transaction is a non-listed foreign affiliate of a listed entity that is owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more listed entities on the Entity List (supplement no. 4 to part 744) or Military End-User (MEU) List (supplement no. 7 to part 744), or by unlisted entities that are subject to Entity List or MEU license requirements
(ii) to or within any destination other than Country Group E:1 or E:2 when the following criteria are met:
(A) A party to the transaction is a non-listed foreign affiliate of a listed entity that is owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more listed entities on the Entity List or on the MEU List or by unlisted entities that are subject to Entity List or MEU license requirements or other Entity List or MEU restrictions based upon their ownership;
(B) Such party to the transaction is a joint venture with a non-listed entity headquartered in the United States or Country Group A:5 or A:6 that is not owned 50 percent or more, directly or indirectly, individually or in aggregate, by one or more listed entities on the Entity List or the MEU List or by unlisted entities that are subject to Entity List or MEU license requirements or other Entity List or MEU restrictions based upon their ownership.
(2)
(3)
(4)
50 U.S.C. 4801-4852; 50 U.S.C. 4601
(a) * * *
(2) * * * These EAR controls also apply to any foreign affiliate of a listed entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more persons blocked pursuant to the programs listed in paragraph (a)(1) of this section. An entity owned 50 percent or more, directly or indirectly, by multiple entities subject to EAR license requirements pursuant to some combination of the Entity List, MEU List, or SDN List designated under programs listed in paragraph (a)(1) of this section, is subject to the most restrictive license requirements, license exception eligibility, and license review policy applicable to one or more of its owners under the EAR.
(b) Unless the export, reexport, or transfer (in-country) is authorized under an OFAC specific or general license or exempted under OFAC's regulations, a license is required under the EAR for the export, reexport, or transfer (in-country) of any item “subject to the EAR” when a person who is designated on OFAC's SDN List with, or blocked pursuant to, any of the identifiers set forth in paragraph (a)(1) of this section is a party to the transaction as described in § 748.5(c) through (f). * * *
(a) * * *
(1)
(e)
The additions and revision read as follows:
(a) * * *
(3) MEU List and Entity List restrictions extend to foreign affiliates of listed entities owned 50 percent or more by one or more listed entities or entities subject to Entity List or MEU List restrictions based upon their ownership. The MEU List and Entity List license requirements in paragraphs (a)(1) and (2) of this section also apply to any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities or entities subject to Entity List or MEU List restrictions based upon their ownership. The license requirements in paragraphs (a)(1) and (2) of this section do not apply to unlisted foreign affiliates that are owned, directly or indirectly, individually or in the aggregate, solely by one or more unlisted `military end users,' unless the unlisted foreign affiliate itself meets the definition of a `military end user.' An entity owned 50 percent or more, directly or indirectly, by multiple entities subject to EAR license requirements pursuant to some combination of the Entity List, MEU List, or SDN List designated under programs listed in § 744.8(a)(1), is subject to the most restrictive license requirements, license exception eligibility, and license review policy applicable to one or more of its owners under the EAR. If an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is owned, directly or indirectly, by one or more listed entities, they must resolve the Red Flag or obtain a license from BIS prior to proceeding with the export, reexport, or transfer (in-country) (see Red Flag 29 in supplement no. 3 to part 732).
(b) * * *
(2)
(d) * * *
This supplement lists certain entities or addresses subject to license requirements and other Entity List restrictions for specified items under this part 744 and part 746 of the EAR. License requirements for these entities include exports, reexports, and transfers (in-country) unless otherwise stated. A license is required, to the extent specified on the Entity List, to export, reexport, or transfer (in-country) any item subject to the EAR when an entity or a party to the transaction is operating at an address that is listed on the Entity List under an address entry is a party to the transaction as described in § 748.5(c) through (f) of the EAR. The Entity List license requirements and other Entity List restrictions also apply to any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities or entities that are subject to restrictions based upon their ownership. An entity owned 50 percent or more, directly or indirectly, by multiple entities subject to EAR license requirements pursuant to some combination of the Entity List, MEU List, or SDN List designated under programs listed in § 744.8(a)(1), is subject to the most restrictive license requirements, license exception eligibility, and license review policy applicable to one or more of its owners under the EAR. If an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity owned, directly or indirectly, by one or more listed entities, they must resolve the Red Flag or obtain a license from BIS prior to proceeding with the export, reexport, or transfer (in-country), unless a license exception is available (see Red Flag 29 in supplement no. 3 to part 732). This list is revised and updated on a periodic basis in this supplement by adding new or amended notifications and deleting notifications no longer in effect.
The license requirement for entities listed in supplement no. 7 to part 744 applies to the export, reexport, or transfer (in-country) of any item subject to the EAR listed in supplement no. 2 to part 744. A license is required to export, reexport, or transfer (in-country) any item subject to the EAR listed in supplement no. 2 to part 744 when an entity that is listed on the MEU List is a party to the transaction as described in § 748.5(c) through (f). No license exceptions are available for exports, reexports, or transfers (in-country) to listed entities on the MEU List for items specified in supplement no. 2 to part 744, except license exceptions for items authorized under the provisions of License Exception GOV set forth in § 740.11(b)(2)(i) and (ii) of the EAR as specified in § 744.21(c). The MEU List license requirements and other MEU List restrictions also apply to any foreign entity that is owned, directly or indirectly, individually or in aggregate, 50 percent or more by one or more listed entities or entities that are subject to restrictions based upon their ownership. An entity owned 50 percent or more, directly or indirectly, by multiple entities subject to EAR license requirements pursuant to some combination of the Entity List, MEU List, or SDN List designated under programs listed in § 744.8(a)(1), is subject to the most restrictive license requirements, license exception eligibility, and license review policy applicable to one or more of its owners under the EAR. If an exporter, reexporter, or transferor cannot determine the ownership percentage of a foreign entity that is an entity owned, directly or indirectly, by one or more listed entities, they must resolve the Red Flag or obtain a license from BIS prior to proceeding with the export, reexport, or transfer (in-country) (s
(a)
(b)
(c)
50 U.S.C. 4801-4852; 50 U.S.C. 4601
(aa) Affiliates rule entities.
(cc)
(b) Having completed the interagency process contemplated in the Act, I have determined the following:
(A) First, the divestiture removes the TikTok application and certain other applications from the control of a foreign adversary, as defined under the Act, because, among other things, the new joint venture would be based in the United States and less than 20 percent of the joint venture would be owned or controlled by foreign adversary entities or persons.
(B) Second, the divestiture puts the operation of the algorithms and code, as well as content-moderation decisions, under the control of the new joint venture.
(C) Third, the divestiture prohibits the storage of sensitive United States user data in a manner that would place such data under the control of a foreign adversary and requires such data be stored in a cloud environment run by an American company.
(D) Fourth, the divestiture includes intense monitoring of software updates, algorithms, and data flows by the United States' trusted security partners, and it requires all recommendation models, including algorithms, that use United States user data to be retrained and monitored by those trusted security partners.
(c) Based on these findings, I further determine that the divestiture of the applications outlined in the Framework Agreement, once its implementation agreements are executed, is a “qualified divestiture” under the Act, including with respect to the TikTok applications, the Lemon8 application, the CapCut applications, any other application or website duly operated by the new joint venture, and their associated or affiliated websites.
(b) The Attorney General shall take all appropriate action to issue written guidance to implement the provisions of subsection (a) of this section.
(c) The Attorney General shall issue a letter to appropriate providers stating that there has been no violation of the Act and that there is no liability for any conduct that occurs during the 120-day period specified in subsection (a) of this section, as well as for any conduct from the effective date of the Act until the issuance of this order.
(d) Because of the national security interests at stake and because section 2(d) of the Act vests the sole authority for investigations and enforcement of the Act in the Attorney General, attempted enforcement by the States or private parties represents an encroachment on the powers of the Executive. The Attorney General shall exercise all available authority to preserve and defend the Executive's exclusive authority to enforce the Act, including the President's determination of a qualified divestiture.
(e) The Attorney General or the Attorney General's designee shall serve as the United States Government's representative under the Framework Agreement. The Attorney General shall receive any information from the new joint venture, trusted security partners, or any other party from whom information is provided pursuant to the Framework Agreement and this order on behalf of the United States Government. Trusted security partners may also share information with other United States Government officials.
(a) The Order of August 14, 2020 (Regarding the Acquisition of Musical.ly by ByteDance Ltd.) (Divestment Order), expressly reserved my authority to issue further orders with respect to ByteDance Ltd., Musical.ly, Musical.ly in the United States, and TikTok Inc. as shall in my judgment be necessary to protect the national security. The threatened impairment to the national security described in the Divestment Order can be adequately mitigated if, after, or in conjunction with, the execution of the Framework Agreement's implementation agreements, the Committee on Foreign Investment in the United States (CFIUS) enters into an agreement with certain Investor Parties that ensures the alignment of the economic incentives of such Investor Parties with compliance with the terms of the Framework Agreement to protect national security.
(b) The agreement described in subsection (a) of this section also resolves any national security concern under section 721 of the Defense Production Act of 1950 (50 U.S.C. 4565) (section 721) arising from the acquisition of Musical.ly by ByteDance Ltd. as modified by the divestiture outlined in the Framework Agreement.
(c) On the basis of the findings set forth in subsections (a) and (b) of this section, considering the factors described in subsection (f) of section 721, as appropriate, and pursuant to my authority under applicable law, including section 721, I hereby order that:
(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
(c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
(d) The costs for publication of this order shall be borne by the Department of Justice.
(b) The JTTFs shall investigate potential Federal crimes relating to acts of recruiting or radicalizing persons for the purpose of:
(c) The JTTFs shall also investigate:
(d) The JTTFs shall consult and coordinate with executive departments and agencies (agencies) as needed to determine whether such agencies can apply existing authorities or exercise their own authorities, as appropriate, to support the JTTFs' investigations and relevant prosecutions of political violence.
(e) The JTTFs may, to the extent permitted by law, request operational assistance from and coordinate with law enforcement partners when investigating domestic terrorism.
(f) The National Joint Terrorism Task Force shall provide regular progress updates to the President through the Assistant to the President and Homeland Security Advisor.
(g) The Attorney General shall direct the Department of Justice to prosecute all Federal crimes, to the maximum extent permissible by law, related to the investigations described in subsections (a) through (c) of this section.
(h) The Attorney General shall issue specific guidance that ensures domestic terrorism priorities include politically motivated terrorist acts such as
(i) The Secretary of the Treasury (Secretary), in coordination with the Attorney General, shall make available all resources, to the maximum extent permitted by law, to identify and disrupt financial networks that fund domestic terrorism and political violence. The Secretary, acting through the Terrorism and Financial Intelligence Office of the Department of the Treasury, shall deploy investigative tools, examine financial flows, and coordinate with partner agencies to trace illicit funding streams. The Secretary shall provide guidance for financial institutions to file Suspicious Activity Reports and investigate indicia of illicit funding streams to ensure such activity is rooted out at the source and referred for law enforcement action, as appropriate.
(j) The Commissioner of the Internal Revenue Service (Commissioner) shall take action to ensure that no tax-exempt entities are directly or indirectly financing political violence or domestic terrorism. In addition, where applicable, the Commissioner shall ensure that the Internal Revenue Service refers such organizations, and the employees and officers of such organizations, to the Department of Justice for investigation and possible prosecution.
(k) All Federal law enforcement agencies with investigative authority shall question and interrogate, within all lawful authorities, individuals engaged in political violence or lawlessness regarding the entity or individual organizing such actions and any related financial sponsorship of those actions prior to adjudication or initiation of a plea agreement. Investigations should prioritize crimes such as the following: assaulting Federal officers or employees or otherwise engaging in conduct proscribed by 18 U.S.C. 111; conspiracy against rights under 18 U.S.C. 241; conspiracy to commit offense under 18 U.S.C. 371; solicitation to commit a crime of violence under 18 U.S.C. 373; money laundering under 18 U.S.C. 1956; funding of terrorist acts or otherwise facilitating terrorism under 18 U.S.C. 2339, 2339A, 2339B, 2339C, and 2339D; arson offenses under 18 U.S.C. 844; violations of the Racketeer Influenced and Corrupt Organizations Act (18 U.S.C. 1961
(l) All Federal law enforcement agencies with investigative authority shall adopt strategies similar to those used to address violent crime and organized crime to disrupt and dismantle entire networks of criminal activity.
(b) This memorandum shall be implemented consistent with applicable law and subject to the availability of appropriations.
(c) This memorandum is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
(d) The Secretary of Homeland Security is authorized and directed to publish this memorandum in the