81_FR_53499 81 FR 53343 - Chief Compliance Officer Annual Report Requirements for Futures Commission Merchants, Swap Dealers, and Major Swap Participants; Amendments to Filing Dates

81 FR 53343 - Chief Compliance Officer Annual Report Requirements for Futures Commission Merchants, Swap Dealers, and Major Swap Participants; Amendments to Filing Dates

COMMODITY FUTURES TRADING COMMISSION

Federal Register Volume 81, Issue 156 (August 12, 2016)

Page Range53343-53348
FR Document2016-19231

The Commodity Futures Trading Commission (``Commission'' or ``CFTC'') is proposing to amend certain provisions of its regulations concerning Chief Compliance Officers (``Proposal''). The regulation that is the subject of the Proposal addresses chief compliance officers (``CCOs'') of futures commission merchants (``FCMs''), swap dealers (``SDs''), and major swap participants (``MSPs'') (collectively, ``Registrants''). The proposed amendments would: Codify existing no- action relief regarding the timing of when a Registrant must furnish its CCO annual report to the Commission; clarify filing requirements for Registrants located in a jurisdiction for which the Commission has issued a comparability determination; and delegate to the Director of the Division of Swap Dealer and Intermediary Oversight (``DSIO'') authority to grant extensions to the CCO annual report filing deadline.

Federal Register, Volume 81 Issue 156 (Friday, August 12, 2016)
[Federal Register Volume 81, Number 156 (Friday, August 12, 2016)]
[Proposed Rules]
[Pages 53343-53348]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-19231]


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COMMODITY FUTURES TRADING COMMISSION

17 CFR Part 3

RIN 3038-AE49


Chief Compliance Officer Annual Report Requirements for Futures 
Commission Merchants, Swap Dealers, and Major Swap Participants; 
Amendments to Filing Dates

AGENCY: Commodity Futures Trading Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commodity Futures Trading Commission (``Commission'' or 
``CFTC'') is proposing to amend certain provisions of its regulations 
concerning Chief Compliance Officers (``Proposal''). The regulation 
that is the subject of the Proposal addresses chief compliance officers 
(``CCOs'') of futures commission merchants (``FCMs''), swap dealers 
(``SDs''), and major swap participants (``MSPs'') (collectively, 
``Registrants''). The proposed amendments would: Codify existing no-
action relief regarding the timing of when a Registrant must furnish 
its CCO annual report to the Commission; clarify filing requirements 
for Registrants located in a jurisdiction for which the Commission has 
issued a comparability determination; and delegate to the Director of 
the Division of Swap Dealer and Intermediary Oversight (``DSIO'') 
authority to grant extensions to the CCO annual report filing deadline.

DATES: Comments must be received on or before September 12, 2016.

ADDRESSES: You may submit comments, identified by RIN 3038-AE49, by any 
of the following methods:
     CFTC Web site: http://comments.cftc.gov. Follow the 
instructions for submitting comments through the Comments Online 
process on the Web site.
     Mail: Send to Christopher Kirkpatrick, Secretary of the 
Commission, Commodity Futures Trading Commission, Three Lafayette 
Centre, 1155 21st Street NW., Washington, DC 20581.
     Hand Delivery/Courier: Same as Mail, above.

[[Page 53344]]

     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    Please submit your comments using only one of these methods.
    All comments must be submitted in English, or if not, accompanied 
by an English translation. Comments will be posted as received to 
http://www.cftc.gov. You should submit only information that you wish 
to make available publicly. If you wish the Commission to consider 
information that is exempt from disclosure under the Freedom of 
Information Act (``FOIA''),\1\ a petition for confidential treatment of 
the exempt information may be submitted according to the procedures set 
forth in Sec.  145.9 of the Commission's regulations.\2\
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    \1\ 5 U.S.C. 552.
    \2\ 17 CFR 145.9. The Commission's regulations are found at 17 
CFR Chapter I and can be accessed through the Commission's Web site 
at www.cftc.gov.
_____________________________________-

    The Commission reserves the right, but shall have no obligation, to 
review, pre-screen, filter, redact, refuse or remove any or all of your 
submission from www.cftc.gov that it may deem to be inappropriate for 
publication, such as obscene language. All submissions that have been 
redacted or removed that contain comments on the merits of the 
rulemaking will be retained in the public comment file and will be 
considered as required under the Administrative Procedure Act and other 
applicable laws, and may be accessible under the FOIA.

FOR FURTHER INFORMATION CONTACT: Eileen Flaherty, Director, 202-418-
5326, eflaherty@cftc.gov; Erik Remmler, Deputy Director, 202-418-7630, 
eremmler@cftc.gov; Laura Gardy, Associate Director, 202-418-7645, 
lgardy@cftc.gov; or Pamela M. Geraghty, Special Counsel, 202-418-5634, 
pgeraghty@cftc.gov, Division of Swap Dealer and Intermediary Oversight, 
Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st 
Street NW., Washington, DC 20581.

SUPPLEMENTARY INFORMATION: 

I. Background

A. Commission Requirements for Submission of CCO Annual Reports

    Section 4s(k)(3) of the Commodity Exchange Act (``CEA'') requires 
CCOs for SDs and MSPs, in accordance with rules prescribed by the 
Commission, to prepare and sign an annual report (``CCO Annual 
Report'') describing, among other things, the SD's or MSP's compliance 
with the CEA and CFTC regulations.\3\ CEA section 4s(k)(3)(B) requires 
the CCO Annual Report to accompany each appropriate financial report of 
the SD or MSP required to be furnished to the Commission.\4\ CEA 
section 4d(d) requires CCOs of FCMs to ``perform such duties and 
responsibilities'' as are established by Commission regulation or rules 
of a registered futures association.\5\
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    \3\ 7 U.S.C. 6s(k)(3)(A)(i). The CEA can be accessed through the 
Commission's Web site.
    \4\ 7 U.S.C. 6s(k)(3)(B)(i).
    \5\ 7 U.S.C. 6d(d).
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    Regulations 3.3(e) and (f) codify the duty to prepare and furnish 
to the Commission a CCO Annual Report for all Registrants.\6\ 
Regulation 3.3(e) requires the CCO Annual Report to cover the most 
recently completed fiscal year of the Registrant and specifies certain 
reporting elements for Registrants in describing their compliance with 
the CEA and Commission regulations. Regulation 3.3(f)(1) requires the 
furnishing of the CCO Annual Report to the board or senior officer 
prior to its submission to the Commission. Regulation 3.3(f)(2) 
currently requires the CCO Annual Report to be furnished to the 
Commission electronically not more than 60 days after a Registrant's 
fiscal year-end.
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    \6\ 17 CFR 3.3(e) and (f).
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B. Regulation 3.3(f)(2) Implementation Experience

    Since the adoption of the 60-day filing requirement, DSIO has 
continuously provided no-action relief for CCO Annual Reports submitted 
to the Commission within 90 days of a Registrant's fiscal year-end.\7\ 
The no-action letter currently in effect, CFTC Staff Letter No. 15-15, 
responds to a request for relief on behalf of FCM and SD firms, which 
stated that having an additional 30 days to file the CCO Annual Report 
allows each Registrant to conduct a more substantive and complete 
review of its compliance program.\8\
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    \7\ See CFTC Letter No. 13-84, Time-Limited No-Action Relief for 
Futures Commission Merchants, Swap Dealers, and Major Swap 
Participants from Compliance with the Timing Requirements of 
Commission Regulation 3.3(f)(2) Relating to Annual Reports by Chief 
Compliance Officers (Dec. 30, 2013), available at: http://www.cftc.gov/idc/groups/public/@lrlettergeneral/documents/letter/13-84.pdf; CFTC Letter No. 14-154, Time-Limited No-Action Relief for 
Futures Commission Merchants, Swap Dealers, and Major Swap 
Participants from Compliance with the Timing Requirements of 
Commission Regulation 3.3(f)(2) Relating to Annual Reports by Chief 
Compliance Officers (Dec. 22, 2014), available at: http://www.cftc.gov/idc/groups/public/@lrlettergeneral/documents/letter/14-154.pdf; and CFTC Letter No. 15-15, No-Action Relief for Futures 
Commission Merchants, Swap Dealers, and Major Swap Participants from 
Compliance with the Timing Requirements of Commission Regulation 
3.3(f)(2) Relating to Annual Reports by Chief Compliance Officers 
(Mar. 27, 2015), available at: http://www.cftc.gov/idc/groups/public/@lrlettergeneral/documents/letter/15-15.pdf (``CFTC Staff 
Letter No. 15-15'').
    \8\ FIA and ISDA Letter, Request for no-action relief concerning 
certain requirements of CFTC Rule 3.3 relating to the timing of the 
Annual Report (Mar. 10, 2015) (on file with the CFTC, available for 
inspection and copying).
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    Recently, the U.S. Securities and Exchange Commission (``SEC'') 
adopted final rules corresponding to Regulation 3.3, and implementing a 
provision of Title VII of the Dodd-Frank Act the text of which is 
effectively identical to CEA section 4s(k)(3)(B).\9\ The SEC's 
corresponding rule requires that the equivalent chief compliance 
officer annual report for security-based swap dealers and major 
security-based swap participants be submitted to the SEC within 30 days 
following the deadline for filing each entity's annual financial 
report.\10\
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    \9\ Business Conduct Standards for Security-Based Swap Dealers 
and Major Security-Based Swap Participants, 81 FR 29959 (May 13, 
2016).
    \10\ See id. at 30150.
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C. Application of Regulation 3.3(f)(2) to Entities Located in Certain 
Non-U.S. Jurisdictions

    In December 2013, the Commission issued comparability 
determinations deeming an SD or MSP located in Canada, the European 
Union, Hong Kong, Japan, or Switzerland (``Substituted Compliance 
Registrants'') to be in compliance with Regulation 3.3(e) if it 
complies with the applicable corresponding regulation in its home 
jurisdiction.\11\ Specifically, a Substituted Compliance Registrant may 
elect to furnish the Commission with the comparable annual reporting 
information (hereinafter, ``Comparable Annual Report'') specified under 
the standards of its home jurisdiction. However, the Commission did not 
provide a comparability determination with respect to Regulation 3.3(f) 
regarding the timing of when the

[[Page 53345]]

Comparable Annual Report must be furnished to the CFTC.\12\
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    \11\ See Comparability Determination for Canada: Certain Entity-
Level Requirements, 78 FR 78839, 78843 (Dec. 27, 2013); 
Comparability Determination for the European Union: Certain Entity-
Level Requirements, 78 FR 78923, 78928 (Dec. 27, 2013); 
Comparability Determination for Hong Kong: Certain Entity-Level 
Requirements, 78 FR 78852, 78856 (Dec. 27, 2013); Comparability 
Determination for Japan: Certain Entity-Level Requirements, 78 FR 
78910, 78915 (Dec. 27, 2013); Comparability Determination for 
Switzerland: Certain Entity-Level Requirements, 78 FR 78899, 78903 
(Dec. 27, 2013). It should be noted that while Australia was granted 
a determination of comparability for some entity-level requirements, 
it was not granted a determination of comparability with respect to 
the requirements of Regulation 3.3(e). See Comparability 
Determination for Australia: Certain Entity-Level Requirements, 78 
FR 78864, 78869 (Dec. 27, 2013).
    \12\ See note 11, supra.
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II. The Proposal

A Proposed Amendments to Regulation 3.3(f)(2)

    The Commission is proposing to codify the current no-action relief 
by amending Regulation 3.3(f)(2). The amendments would permit an FCM to 
furnish its CCO Annual Report to the Commission not more than 30 days 
after submission of the Form 1-FR-FCM \13\ or Financial Operational 
Combined Uniform Single Report (``FOCUS Report''). The Proposal would 
also permit an SD or MSP to furnish its CCO Annual Report to the 
Commission not more than 90 days after its fiscal year-end until such 
time as the Commission adopts and implements rules establishing the 
time for filing the annual financial condition report required under 
CEA section 4s(f). The Commission has proposed, but not yet adopted, a 
financial condition report requirement comprised of an annual audited 
financial report for SDs and MSPs.\14\ Once the Commission adopts and 
implements a financial condition report rule, like FCMs, an SD or MSP 
will have up to 30 days after the submission of its annual financial 
condition report to submit the CCO Annual Report to the Commission.
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    \13\ The proposed amendment also makes a technical correction in 
Regulation 3.3(f)(2) by correcting the cross reference to the 
Commission regulation that requires the filing of Form 1-FR-FCM to 
Regulation 1.10(b)(1)(ii).
    \14\ See Capital Requirements of Swap Dealers and Major Swap 
Participants, 76 FR 27802, 27838 (proposed May 12, 2011).
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    Regulation 3.3(e) requires a broad and detailed assessment of each 
Registrant's compliance program over the preceding year as well as a 
discussion of planned changes and remedial steps to be taken for non-
compliance matters. The Commission believes that providing up to 30 
days after a Registrant's applicable financial reports are due would 
provide Registrants an appropriate amount of time to complete the in-
depth review and analyses required by Regulation 3.3(e). As a policy 
matter, the Commission recognizes that the periodic self-evaluation 
that underlies each CCO Annual Report is a critical step in promoting 
an active and robust compliance culture within firms.
    In codifying the relief provided in CFTC Staff Letter No. 15-15, 
the Commission is clarifying that the statutory requirement for an SD 
or MSP's CCO Annual Report to ``accompany each appropriate financial 
report'' allows for the CCO Annual Report to be furnished to the 
Commission not more than 30 days after the submission of a Registrant's 
annual financial report.\15\ The Commission recognizes the separate and 
distinct nature and purposes of the two reports, and believes that 
allowing Registrants to submit their CCO Annual Reports not more than 
30 days after their financial reports are due satisfies the statutory 
requirement that the CCO Annual Report ``accompany'' the other 
financial report. This is also consistent with the SEC's approach in 
its corresponding rule for delivery of chief compliance officer annual 
reports by security-based swap dealers and major security-based swap 
participants.\16\
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    \15\ The Proposal would remove the obligation of Registrants to 
file their CCO Annual Reports ``simultaneously'' with the applicable 
FCM financial report or financial condition report.
    \16\ In the adopting release, the SEC addresses the statutory 
language that links the filing of the CCO Annual Report with the 
filing of appropriate financial reports by stating, ``The Commission 
is interpreting `accompany' in Section 15F(k)(3)(B)(i) to mean 
follow within 30 days.'' 81 FR 29959, 30059, n.1238.
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B. Registrants Located in Substituted Compliance Jurisdictions

    The Commission is also proposing to amend Regulation 3.3(f) to 
address the timing of the filing requirement for Comparable Annual 
Reports. If the requirements of the Substituted Compliance Registrant's 
home jurisdiction identify a specific date by which the Comparable 
Annual Reports must be completed, then the Commission is proposing that 
Comparable Annual Reports may be furnished to the Commission 
electronically up to 15 days after the date on which the Comparable 
Annual Report must be completed.\17\ The additional 15 days would allow 
time for translation of the report text into English. If the 
Substituted Compliance Registrant's home jurisdiction does not 
establish a specifically identifiable completion date, then the 
Substituted Compliance Registrant must comply with the standard time 
frames provided in Regulation 3.3(f), as amended. A specifically 
identifiable completion date would be a date that can be clearly 
identified such as a specific calendar date or a set number of days 
after the Substituted Compliance Registrant's fiscal year-end. A home 
jurisdiction requirement to complete the Comparable Annual Report only 
if some event occurs or upon request, or which does not specify a 
deadline, is not considered comparable to the Commission's annual 
delivery requirement.
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    \17\ While each of the jurisdictions that have been granted a 
comparability determination with respect to Regulation 3.3(e) 
requires Substituted Compliance Registrants to produce and complete 
comparable annual reporting information, there is variation among 
the foreign jurisdictions as to whether and/or when a Comparable 
Annual Report must be furnished to the home regulator. Therefore, 
the Commission is using the date on which the Comparable Annual 
Report must be completed as the benchmark for determining when the 
Comparable Annual Report must be furnished to the Commission.
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C. Proposed Amendments Regarding a Delegation From the Commission to 
the Division

    Pursuant to Regulation 3.3(f)(5), Registrants may request from the 
Commission an extension of time to furnish their CCO Annual Reports if 
the failure to timely furnish the report could not be avoided absent 
``unreasonable effort or expense.'' The rule provides the Commission 
with discretion in granting such extensions. To expedite review and 
consideration of requests for extensions, the Commission is proposing 
to delegate to the Director of DSIO, or such other employee(s) that the 
Director may designate, the authority to grant extensions of time 
subject to the same standard set forth in Regulation 3.3(f)(5). The 
Commission notes that the exercise of such delegated authority would 
need to be consistent with Regulation 3.3(f)(5) and therefore would be 
limited to unique facts and circumstances that clearly demonstrate that 
the inability to timely furnish the report to the Commission could not 
have been eliminated absent unreasonable effort or expense. The 
Commission believes that such delegation is prudent given that the 
decision to provide an extension requires consideration of specific 
facts and circumstances and often this consideration needs to occur 
within a relatively short period of time. As is the case with existing 
delegations to staff, the Commission would continue to reserve the 
right to perform the functions described in Regulation 3.3(f)(5) itself 
at any time.\18\
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    \18\ In addition, notwithstanding any such delegation, in any 
case in which a Commission employee delegated authority under this 
section believes it is appropriate, the employee may submit the 
question to the Commission for its consideration.
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    The Commission requests comment on the appropriateness of the 
proposed delegation and whether additional procedural detail is 
necessary.

D. Request for Comment

    The Commission seeks comments regarding the following matters:
     Given the current filing requirements for the Form 1-FR-
FCM and FOCUS Reports, and the anticipated

[[Page 53346]]

filing requirements for the financial condition report, is it 
appropriate to permit FCMs, SDs, and MSPs an additional 30-days to 
furnish their CCO Annual Report to the Commission? Are there any 
practical or policy reasons for not permitting the additional 30 days?
     Does codifying the relief granted in CFTC Staff Letter No. 
15-15 sufficiently address Registrants' concerns?
     Should the Commission provide any further clarification of 
the requirements of Regulation 3.3(f) as they apply to entities located 
in jurisdictions for which comparability determinations have been 
issued?

III. Related Matters

A. Regulatory Flexibility Act

    The Regulatory Flexibility Act \19\ (``RFA'') requires that 
agencies consider whether the rules they propose will have a 
significant economic impact on a substantial number of small entities 
and, if so, provide a regulatory flexibility analysis reflecting the 
impact. Section 3.3(f)(2), as proposed, amends the filing deadline for 
CCO Annual Reports of FCMs, SDs, and MSPs and clarifies the filing 
deadline for Comparable Annual Reports. The proposed amendments would 
affect FCMs, SDs, and MSPs that are required to be registered with the 
Commission. The Commission has previously established certain 
definitions of ``small entities'' to be used in evaluating the impact 
of its regulations on small entities in accordance with the RFA, and 
has previously determined that FCMs, SDs, and MSPs are not small 
entities for purposes of the RFA.\20\ Therefore, the Commission 
believes that the amendments to Regulation 3.3 would not have a 
significant economic impact on a substantial number of small entities. 
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.
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    \19\ 5 U.S.C. 601 et seq.
    \20\ See Policy Statement and Establishment of Definitions of 
``Small Entities'' for Purposes of the Regulatory Flexibility Act, 
47 FR 18618, 18619 (Apr. 30, 1982) (FCMs); Further Definition of 
``Swap Dealer,'' ``Security-Based Swap Dealer,'' ``Major Swap 
Participant,'' ``Major Security-Based Swap Participant'' and 
``Eligible Contract Participant,'' 77 FR 30596, 30701 (May 23, 2012) 
(SDs and MSPs).
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B. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (``PRA'') \21\ provides that a 
federal 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 control number issued by the Office of Management and 
Budget (``OMB''). The collection of information related to this 
proposed rule is OMB control number 3038-0080--Annual Report for Chief 
Compliance Officer of Registrants. The Commission believes that this 
proposed rule will not impose any new information collection 
requirements that require approval of OMB under the PRA. As a general 
matter, the proposed rule would allow Registrants up to 90 days after 
the end of their fiscal years, and certain Substituted Compliance 
Registrants with up to 15 days after the date on which the Comparable 
Annual Report must be completed under the requirements of their home 
jurisdiction, to file the CCO Annual Report and Comparable Annual 
Reports, respectively. As such, this proposed rule does not, by itself, 
impose any new burden or any new information collection requirements in 
addition to those that already exist in connection with the preparation 
and delivery of the CCO Annual Report pursuant to part 3 of the 
Commission's regulations.
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    \21\ 44 U.S.C. 3501 et seq.
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C. Cost-Benefit Considerations

1. Background
    As discussed above, the Commission is proposing amendments to the 
filing requirements for CCO Annual Reports in Regulation 3.3 that 
would: (1) Increase the amount of time registrants have to file their 
CCO Annual Reports with the Commission; and (2) clarify the filing 
requirements for Comparable Annual Reports. The baseline for this cost 
and benefit consideration is existing Regulation 3.3. Although CFTC 
Staff Letter No. 15-15, as discussed above, currently offers no-action 
relief that is substantially similar to the relief that the proposed 
amendments would grant Registrants, as a no-action letter, it only 
represents the position of the issuing Division or Office and cannot 
bind the Commission or other Commission staff.\22\ Consequently, the 
Commission believes that CFTC Staff Letter No. 15-15 should not set or 
affect the baseline against which the Commission considers the costs 
and benefits of the proposal.
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    \22\ See 17 CFR 140.99(a)(2). See also CFTC Staff Letter No. 15-
15 at 4.
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2. Costs
    The Commission received no comments during the rulemaking process 
for Regulation 3.3 regarding costs associated with the timing of the 
filing deadline for the CCO Annual Report. The proposed amendment does 
not change the report contents or require any additional actions to be 
taken by Registrants. The additional 30 days (or up to 15 days after 
the date on which a Comparable Annual Report must be completed under 
applicable home jurisdiction standards that allow more time) provided 
by the proposal lengthens the time before senior management or the 
board of the Registrants and the Commission may receive the CCO Annual 
Reports. The additional time to furnish the reports should not 
materially impact regulatory oversight given that the purpose of the 
reports is to provide a status update for the Registrant's compliance 
activities over the course of the preceding fiscal year and planned 
changes for the coming year. The reports generally do not serve to 
address crisis situations for which immediacy is critical. Therefore, 
the additional time allowed will not materially impact the usefulness 
of the information in the reports.\23\ The Commission has no other 
information available to it that would indicate that changing the 
filing deadline would measurably change the cost to prepare the CCO 
Annual Reports. Accordingly, the Commission preliminarily believes that 
the proposal would not impose any additional costs on any other market 
participants, the markets themselves, or the general public. The 
Commission invites comment regarding the nature of, and the extent to 
which, costs associated with the CCO Annual Reports could change as a 
result of the adoption of the proposal and, to the extent they can be 
quantified, monetary and other numerical estimates thereof.
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    \23\ The CCO Annual Report must contain a description of 
material non-compliance events that occurred over the review period. 
However, reporting on those events in the CCO Annual Report provides 
transparency regarding the effectiveness of the implementation of 
the compliance program over the preceding year for management and 
the CFTC.
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3. Benefits
    The Commission believes that the proposal would provide relief for 
Registrants from time pressures in preparing and filing their CCO 
Annual Reports. The additional time provided will allow Registrants to 
more carefully complete their internal processes used to develop the 
broad variety of information needed for the reports resulting in more 
accurate and complete reports. The Commission invites comment regarding 
the nature and extent of these and any other benefits that could result 
from adoption of the proposal--including benefits to other market 
participants, the market itself, or the general public--and, to the 
extent they can be quantified, monetary and other numerical estimates 
thereof.

[[Page 53347]]

4. Section 15(a) Factors
    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.\24\ Section 15(a) further 
specifies that the costs and benefits shall be evaluated in light of 
five broad areas of market and public concern: (1) Protection of market 
participants and the public; (2) efficiency, competitiveness, and 
financial integrity of futures markets; (3) price discovery; (4) sound 
risk management practices; and (5) other public interest 
considerations. The Commission considers the costs and benefits 
resulting from its discretionary determinations with respect to the 
section 15(a) factors.
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    \24\ 7 U.S.C. 19(a).
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a. Protection of Market Participants and the Public
    The Commission recognizes that there are trade-offs between 
reducing regulatory burdens and ensuring that the Commission has 
sufficient, timely information to fulfill its regulatory mission. The 
proposed amendments to Regulation 3.3 are intended to reduce some of 
the regulatory burdens on Registrants. While the amendment will delay 
the time by which the Commission will receive the CCO Annual Reports, 
the delay is relatively short given that the information in the reports 
looks back over the entire year-long reporting period and identifies 
planned improvements for the coming year. Accordingly, the Commission 
preliminarily believes that the short delay will not affect the 
protection of market participants and the public.
b. Efficiency, Competitiveness, and Financial Integrity of Markets
    The Commission believes that the proposed amendments to Regulation 
3.3 could improve allocational efficiency for participants in the 
market by reducing the burden of preparing the CCO Annual Report in a 
shorter time-frame, thereby allowing them to allocate compliance 
resources more efficiently over the report preparation period. The 
Commission preliminarily believes that the proposed amendments to 
Regulation 3.3 will not have any market efficiency, competitiveness, or 
market integrity impacts because the reports address internal 
compliance programs of each Registrant and are not publicly available.
c. Price Discovery
    The Commission preliminarily believes that the proposed amendments 
to Regulation 3.3 would not impact on price discovery. Given the fact 
that the proposed amendments affect only the timing of when the CCO 
Annual Reports are filed with the Commission and the CCO Annual Reports 
generally would not contain trade information or be available to the 
public, the proposed amendments would not affect price discovery.
d. Sound Risk Management Practices
    The Commission preliminarily believes that the proposed amendments 
would not have a meaningful effect on the risk management practices of 
Registrants. While the CCO Annual Reports may discuss certain risk 
management aspects related to the compliance programs of the 
Registrants, the proposal would only amend the timing of delivery of 
the reports to the Commission, not the contents of the reports. As 
described above under subsection 4.a, the short delay in delivery of 
the reports provided for by the proposal is not significant given the 
nature of the information included in the report and allowing 
additional time to prepare the CCO Annual Reports might allow the 
Registrants to prepare better reports that more effectively address the 
information contained therein.
e. Other Public Interest Considerations
    The Commission has not identified any other public interest 
considerations for this rulemaking.
5. Request for Comment
    The Commission invites comment on all aspects of its preliminary 
consideration of the costs and benefits associated with the proposal 
and the five factors the Commission is required to consider under CEA 
section 15(a). In addressing these areas and any other aspect of the 
Commission's preliminary cost-benefit considerations, the Commission 
encourages commenters to submit any data or other information they may 
have quantifying and/or qualifying the costs and benefits of the 
proposal.

List of Subjects in 17 CFR Part 3

    Administrative practice and procedure, Brokers, Commodity futures, 
Major swap participants, Reporting and recordkeeping requirements, Swap 
dealers.

    For the reasons stated in the preamble, the Commodity Futures 
Trading Commission proposes to amend 17 CFR part 3 as follows:

PART 3--REGISTRATION

0
1. The authority citation for part 3 is revised to read as follows:

    Authority: 5 U.S.C. 552, 552b; 7 U.S.C. 1a, 2, 6a, 6b, 6b-1, 6c, 
6d, 6e, 6f, 6g, 6h, 6i, 6k, 6m, 6n, 6o, 6p, 6s, 8, 9, 9a, 12, 12a, 
13b, 13c, 16a, 18, 19, 21, 23, as amended by Title VII of the Dodd-
Frank Wall Street Reform and Consumer Protection Act, Pub. L. 111-
203, 124 Stat. 1376 (Jul. 21, 2010).

0
2. Amend Sec.  3.3 as follows:
0
a. Revise paragraph (f)(2); and
0
b. Add paragraph (h).
    The revision and addition to read as follows:


Sec.  3.3  Chief compliance officer.

* * * * *
    (f) * * *
    (2)(i) Except as provided in paragraph (f)(2)(ii) of this section, 
the annual report shall be furnished electronically to the Commission 
not more than 30 days after the submission of Form 1-FR-FCM, as 
required under Sec.  1.10(b)(1)(ii) of this chapter, the Financial and 
Operational Combined Uniform Single Report, as required under Sec.  
1.10(h) of this chapter, or the financial condition report, as required 
under section 4s(f) of the Act, as applicable. Until such time as the 
Commission adopts and implements a regulation establishing the time for 
filing the financial condition report, a swap dealer or major swap 
participant shall furnish the annual report electronically to the 
Commission not more than 90 days after the end of its fiscal year.
    (ii) The annual report of a swap dealer or major swap participant 
that is eligible to comply with a substituted compliance regime for 
paragraph (e) of this section pursuant to a comparability determination 
of the Commission may be furnished to the Commission electronically up 
to 15 days after the date on which the comparable annual report must be 
completed under the requirements of the applicable substituted 
compliance regime. If the substituted compliance regime does not 
specify a date by which the comparable annual report must be completed, 
then the annual report shall be furnished to the Commission by the date 
specified in paragraph (f)(2)(i) of this section.
* * * * *
    (h) Delegation of Authority. The Commission hereby delegates to the 
Director of the Division of Swap Dealer and Intermediary Oversight, or 
such other employee or employees as the Director may designate from 
time to time, the authority to grant extensions of time, as set forth 
in paragraph (f)(5) of this section. Notwithstanding such

[[Page 53348]]

delegation, in any case in which a Commission employee delegated 
authority under this paragraph believes it appropriate, he or she may 
submit to the Commission for its consideration the question of whether 
an extension of time should be granted. The delegation of authority in 
this paragraph shall not prohibit the Commission, at its election, from 
exercising the authority set forth in paragraph (f)(5) of this section.

    Issued in Washington, DC, on August 8, 2016, by the Commission.
Christopher J. Kirkpatrick,
Secretary of the Commission.

    Note: The following appendix will not appear in the Code of 
Federal Regulations.

Appendix to Chief Compliance Officer Annual Report Requirements for 
Futures Commission Merchants, Swap Dealers, and Major Swap 
Participants; Amendments to Filing Dates--Commission Voting Summary

    On this matter, Chairman Massad and Commissioners Bowen and 
Giancarlo voted in the affirmative. No Commissioner voted in the 
negative.

[FR Doc. 2016-19231 Filed 8-11-16; 8:45 am]
BILLING CODE 6351-01-P



                                                                       Federal Register / Vol. 81, No. 156 / Friday, August 12, 2016 / Proposed Rules                                                  53343

                                               operations descending below 1,500 feet                  The Proposed Amendment                                    Issued in Seattle, Washington, on August 1,
                                               above the surface, and IFR departure                                                                            2016.
                                               operations below 1,200 feet above the                     Accordingly, pursuant to the                          Tracey Johnson,
                                               surface.                                                authority delegated to me, the Federal                  Manager, Operations Support Group, Western
                                                  This proposal would also remove                      Aviation Administration proposes to                     Service Center.
                                               reference to the Maui VORTAC from the                   amend 14 CFR part 71 as follows:                        [FR Doc. 2016–19004 Filed 8–11–16; 8:45 am]
                                               airspace legal descriptions for the Class                                                                       BILLING CODE 4910–13–P
                                                                                                       PART 71—DESIGNATION OF CLASS A,
                                               E3 airspace area designated as an
                                                                                                       B, C, D, AND E AIRSPACE AREAS; AIR
                                               extension to the Class C surface area,
                                                                                                       TRAFFIC SERVICE ROUTES; AND
                                               and the Class E5 airspace area extending
                                                                                                       REPORTING POINTS                                        COMMODITY FUTURES TRADING
                                               upward from 700 feet above the surface.
                                               Changes to the available instrument                                                                             COMMISSION
                                               flight procedures since the last review,                ■ 1. The authority citation for 14 CFR
                                                                                                       part 71 continues to read as follows:                   17 CFR Part 3
                                               advances in GPS mapping accuracy, and
                                               a reliance on precise geographic                          Authority: 49 U.S.C. 106(f), 106(g), 40103,
                                                                                                                                                               RIN 3038–AE49
                                               coordinates to define airport and                       40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR,
                                               airspace reference points have made the                 1959–1963 Comp., p. 389.                                Chief Compliance Officer Annual
                                               proposed airspace redesign necessary                                                                            Report Requirements for Futures
                                                                                                       § 71.1       [Amended]
                                               for the safety and management of                                                                                Commission Merchants, Swap Dealers,
                                               Instrument Flight Rules (IFR)                           ■ 2. The incorporation by reference in                  and Major Swap Participants;
                                               operations.                                             14 CFR 71.1 of FAA Order 7400.9Z,                       Amendments to Filing Dates
                                                  Class E airspace designations are                    Airspace Designations and Reporting
                                               published in paragraphs 6003, and                       Points, dated August 6, 2015, and                       AGENCY: Commodity Futures Trading
                                               6005, respectively, of FAA Order                        effective September 15, 2015, is                        Commission.
                                               7400.9Z, dated August 6, 2015, and                      amended as follows:                                     ACTION: Notice of proposed rulemaking.
                                               effective September 15, 2015, which is                  Paragraph 6003 Class E Airspace Areas
                                               incorporated by reference in 14 CFR                                                                             SUMMARY:    The Commodity Futures
                                                                                                       Designated as an Extension to a Class C                 Trading Commission (‘‘Commission’’ or
                                               71.1. The Class E airspace designations                 Surface Area.
                                               listed in this document will be                                                                                 ‘‘CFTC’’) is proposing to amend certain
                                                                                                       *        *      *      *       *                        provisions of its regulations concerning
                                               published subsequently in the Order.
                                                                                                       AWP HI E3         Kahului, HI [Modified]                Chief Compliance Officers (‘‘Proposal’’).
                                               Regulatory Notices and Analyses                                                                                 The regulation that is the subject of the
                                                                                                       Kahului Airport, HI
                                                  The FAA has determined that this                                                                             Proposal addresses chief compliance
                                                                                                         (Lat. 20°53′55″ N., long. 156°25′50″ W.)
                                               regulation only involves an established                                                                         officers (‘‘CCOs’’) of futures commission
                                                                                                         That airspace extending upward from the               merchants (‘‘FCMs’’), swap dealers
                                               body of technical regulations for which                 surface within 3 miles each side of the
                                               frequent and routine amendments are                                                                             (‘‘SDs’’), and major swap participants
                                                                                                       Kahului Airport 203° bearing extending from
                                               necessary to keep them operationally                                                                            (‘‘MSPs’’) (collectively, ‘‘Registrants’’).
                                                                                                       the 5-mile radius of the airport to 7 miles
                                               current, is non-controversial and                       southwest of the airport. This Class E
                                                                                                                                                               The proposed amendments would:
                                               unlikely to result in adverse or negative               airspace area is effective during the specific          Codify existing no-action relief
                                               comments. It, therefore: (1) Is not a                   dates and times established in advance by a             regarding the timing of when a
                                               ‘‘significant regulatory action’’ under                 Notice to Airmen. The effective date and time           Registrant must furnish its CCO annual
                                               Executive Order 12866; (2) is not a                     will thereafter be continuously published in            report to the Commission; clarify filing
                                               ‘‘significant rule’’ under DOT                          the Pacific Chart Supplement.                           requirements for Registrants located in a
                                               Regulatory Policies and Procedures (44                                                                          jurisdiction for which the Commission
                                                                                                       Paragraph 6005 Class E Airspace Areas                   has issued a comparability
                                               FR 11034; February 26, 1979); and (3)                   Extending Upward From 700 Feet or More
                                               does not warrant preparation of a                       Above the Surface of the Earth.
                                                                                                                                                               determination; and delegate to the
                                               regulatory evaluation as the anticipated                                                                        Director of the Division of Swap Dealer
                                                                                                       *        *      *      *       *                        and Intermediary Oversight (‘‘DSIO’’)
                                               impact is so minimal. Since this is a
                                               routine matter that will only affect air                AWP HI E5         Kahului, HI [Modified]                authority to grant extensions to the CCO
                                               traffic procedures and air navigation, it               Kahului Airport, HI                                     annual report filing deadline.
                                               is certified that this rule, when                          (Lat. 20°53′55″ N., long. 156°25′50″ W.)             DATES: Comments must be received on
                                               promulgated, would not have a                              That airspace extending upward from 700              or before September 12, 2016.
                                               significant economic impact on a                        feet above the surface within a 5-mile radius           ADDRESSES: You may submit comments,
                                               substantial number of small entities                    of Kahului Airport, and within 3.6 miles each           identified by RIN 3038–AE49, by any of
                                               under the criteria of the Regulatory                    side of the airport 038° bearing extending              the following methods:
                                               Flexibility Act.                                        from the 5-mile radius of the airport to 11.7              • CFTC Web site: http://
                                                                                                       miles northeast of the airport, and within 2            comments.cftc.gov. Follow the
                                               Environmental Review                                    miles each side of the airport 065° bearing             instructions for submitting comments
                                                  This proposal will be subject to an                  extending from the 5-mile radius of the                 through the Comments Online process
                                                                                                       airport to 10 miles northeast of the airport,
                                               environmental analysis in accordance                                                                            on the Web site.
                                                                                                       and within 3 miles each side of the airport
                                               with FAA Order 1050.1F,                                                                                            • Mail: Send to Christopher
ehiers on DSK5VPTVN1PROD with PROPOSALS




                                                                                                       203° bearing extending from the 5-mile
                                               ‘‘Environmental Impacts: Policies and                   radius of the airport to 10.3 miles southwest           Kirkpatrick, Secretary of the
                                               Procedures’’ prior to any FAA final                     of the airport, and within the area bounded             Commission, Commodity Futures
                                               regulatory action.                                      by the airport 318° bearing clockwise to the            Trading Commission, Three Lafayette
                                                                                                       airport 013° bearing extending from the 5-              Centre, 1155 21st Street NW.,
                                               List of Subjects in 14 CFR Part 71
                                                                                                       mile radius of the airport to 8.5-miles                 Washington, DC 20581.
                                                Airspace, Incorporation by reference,                  northeast of the airport, excluding that                   • Hand Delivery/Courier: Same as
                                               Navigation (air).                                       airspace beyond 12 miles from the coast.                Mail, above.


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                                               53344                   Federal Register / Vol. 81, No. 156 / Friday, August 12, 2016 / Proposed Rules

                                                  • Federal eRulemaking Portal: http://                regulations.3 CEA section 4s(k)(3)(B)                   additional 30 days to file the CCO
                                               www.regulations.gov. Follow the                         requires the CCO Annual Report to                       Annual Report allows each Registrant to
                                               instructions for submitting comments.                   accompany each appropriate financial                    conduct a more substantive and
                                                  Please submit your comments using                    report of the SD or MSP required to be                  complete review of its compliance
                                               only one of these methods.                              furnished to the Commission.4 CEA                       program.8
                                                  All comments must be submitted in                    section 4d(d) requires CCOs of FCMs to                     Recently, the U.S. Securities and
                                               English, or if not, accompanied by an                   ‘‘perform such duties and                               Exchange Commission (‘‘SEC’’) adopted
                                               English translation. Comments will be                   responsibilities’’ as are established by                final rules corresponding to Regulation
                                               posted as received to http://                           Commission regulation or rules of a                     3.3, and implementing a provision of
                                               www.cftc.gov. You should submit only                    registered futures association.5                        Title VII of the Dodd-Frank Act the text
                                                                                                          Regulations 3.3(e) and (f) codify the                of which is effectively identical to CEA
                                               information that you wish to make
                                                                                                       duty to prepare and furnish to the                      section 4s(k)(3)(B).9 The SEC’s
                                               available publicly. If you wish the
                                                                                                       Commission a CCO Annual Report for                      corresponding rule requires that the
                                               Commission to consider information
                                                                                                       all Registrants.6 Regulation 3.3(e)                     equivalent chief compliance officer
                                               that is exempt from disclosure under the
                                                                                                       requires the CCO Annual Report to                       annual report for security-based swap
                                               Freedom of Information Act (‘‘FOIA’’),1
                                                                                                       cover the most recently completed fiscal                dealers and major security-based swap
                                               a petition for confidential treatment of
                                                                                                       year of the Registrant and specifies                    participants be submitted to the SEC
                                               the exempt information may be
                                                                                                       certain reporting elements for                          within 30 days following the deadline
                                               submitted according to the procedures
                                                                                                       Registrants in describing their                         for filing each entity’s annual financial
                                               set forth in § 145.9 of the Commission’s
                                                                                                       compliance with the CEA and                             report.10
                                               regulations.2
                                                                                                       Commission regulations. Regulation                      C. Application of Regulation 3.3(f)(2) to
                                                  The Commission reserves the right,                   3.3(f)(1) requires the furnishing of the
                                               but shall have no obligation, to review,                                                                        Entities Located in Certain Non-U.S.
                                                                                                       CCO Annual Report to the board or                       Jurisdictions
                                               pre-screen, filter, redact, refuse or                   senior officer prior to its submission to
                                               remove any or all of your submission                    the Commission. Regulation 3.3(f)(2)                       In December 2013, the Commission
                                               from www.cftc.gov that it may deem to                   currently requires the CCO Annual                       issued comparability determinations
                                               be inappropriate for publication, such as               Report to be furnished to the                           deeming an SD or MSP located in
                                               obscene language. All submissions that                  Commission electronically not more                      Canada, the European Union, Hong
                                               have been redacted or removed that                      than 60 days after a Registrant’s fiscal                Kong, Japan, or Switzerland
                                               contain comments on the merits of the                   year-end.                                               (‘‘Substituted Compliance Registrants’’)
                                               rulemaking will be retained in the                                                                              to be in compliance with Regulation
                                               public comment file and will be                         B. Regulation 3.3(f)(2) Implementation                  3.3(e) if it complies with the applicable
                                               considered as required under the                        Experience                                              corresponding regulation in its home
                                               Administrative Procedure Act and other                    Since the adoption of the 60-day filing               jurisdiction.11 Specifically, a
                                               applicable laws, and may be accessible                  requirement, DSIO has continuously                      Substituted Compliance Registrant may
                                               under the FOIA.                                         provided no-action relief for CCO                       elect to furnish the Commission with
                                               FOR FURTHER INFORMATION CONTACT:                        Annual Reports submitted to the                         the comparable annual reporting
                                               Eileen Flaherty, Director, 202–418–                     Commission within 90 days of a                          information (hereinafter, ‘‘Comparable
                                               5326, eflaherty@cftc.gov; Erik Remmler,                 Registrant’s fiscal year-end.7 The no-                  Annual Report’’) specified under the
                                               Deputy Director, 202–418–7630,                          action letter currently in effect, CFTC                 standards of its home jurisdiction.
                                               eremmler@cftc.gov; Laura Gardy,                         Staff Letter No. 15–15, responds to a                   However, the Commission did not
                                               Associate Director, 202–418–7645,                       request for relief on behalf of FCM and                 provide a comparability determination
                                               lgardy@cftc.gov; or Pamela M. Geraghty,                 SD firms, which stated that having an                   with respect to Regulation 3.3(f)
                                               Special Counsel, 202–418–5634,                                                                                  regarding the timing of when the
                                               pgeraghty@cftc.gov, Division of Swap                       3 7 U.S.C. 6s(k)(3)(A)(i). The CEA can be accessed

                                               Dealer and Intermediary Oversight,                      through the Commission’s Web site.                         8 FIA and ISDA Letter, Request for no-action relief
                                                                                                          4 7 U.S.C. 6s(k)(3)(B)(i).                           concerning certain requirements of CFTC Rule 3.3
                                               Commodity Futures Trading                                  5 7 U.S.C. 6d(d).                                    relating to the timing of the Annual Report (Mar.
                                               Commission, Three Lafayette Centre,                        6 17 CFR 3.3(e) and (f).                             10, 2015) (on file with the CFTC, available for
                                               1155 21st Street NW., Washington, DC                       7 See CFTC Letter No. 13–84, Time-Limited No-        inspection and copying).
                                               20581.                                                  Action Relief for Futures Commission Merchants,
                                                                                                                                                                  9 Business Conduct Standards for Security-Based

                                                                                                       Swap Dealers, and Major Swap Participants from          Swap Dealers and Major Security-Based Swap
                                               SUPPLEMENTARY INFORMATION:                              Compliance with the Timing Requirements of              Participants, 81 FR 29959 (May 13, 2016).
                                                                                                                                                                  10 See id. at 30150.
                                                                                                       Commission Regulation 3.3(f)(2) Relating to Annual
                                               I. Background                                           Reports by Chief Compliance Officers (Dec. 30,             11 See Comparability Determination for Canada:

                                               A. Commission Requirements for                          2013), available at: http://www.cftc.gov/idc/groups/    Certain Entity-Level Requirements, 78 FR 78839,
                                                                                                       public/@lrlettergeneral/documents/letter/13-84.pdf;     78843 (Dec. 27, 2013); Comparability Determination
                                               Submission of CCO Annual Reports                        CFTC Letter No. 14–154, Time-Limited No-Action          for the European Union: Certain Entity-Level
                                                                                                       Relief for Futures Commission Merchants, Swap           Requirements, 78 FR 78923, 78928 (Dec. 27, 2013);
                                                  Section 4s(k)(3) of the Commodity                    Dealers, and Major Swap Participants from               Comparability Determination for Hong Kong:
                                               Exchange Act (‘‘CEA’’) requires CCOs                    Compliance with the Timing Requirements of              Certain Entity-Level Requirements, 78 FR 78852,
                                               for SDs and MSPs, in accordance with                    Commission Regulation 3.3(f)(2) Relating to Annual      78856 (Dec. 27, 2013); Comparability Determination
                                               rules prescribed by the Commission, to                  Reports by Chief Compliance Officers (Dec. 22,          for Japan: Certain Entity-Level Requirements, 78 FR
                                                                                                       2014), available at: http://www.cftc.gov/idc/groups/    78910, 78915 (Dec. 27, 2013); Comparability
                                               prepare and sign an annual report                       public/@lrlettergeneral/documents/letter/14-            Determination for Switzerland: Certain Entity-Level
ehiers on DSK5VPTVN1PROD with PROPOSALS




                                               (‘‘CCO Annual Report’’) describing,                     154.pdf; and CFTC Letter No. 15–15, No-Action           Requirements, 78 FR 78899, 78903 (Dec. 27, 2013).
                                               among other things, the SD’s or MSP’s                   Relief for Futures Commission Merchants, Swap           It should be noted that while Australia was granted
                                               compliance with the CEA and CFTC                        Dealers, and Major Swap Participants from               a determination of comparability for some entity-
                                                                                                       Compliance with the Timing Requirements of              level requirements, it was not granted a
                                                                                                       Commission Regulation 3.3(f)(2) Relating to Annual      determination of comparability with respect to the
                                                 15 U.S.C. 552.                                        Reports by Chief Compliance Officers (Mar. 27,          requirements of Regulation 3.3(e). See
                                                 2 17CFR 145.9. The Commission’s regulations are       2015), available at: http://www.cftc.gov/idc/groups/    Comparability Determination for Australia: Certain
                                               found at 17 CFR Chapter I and can be accessed           public/@lrlettergeneral/documents/letter/15-15.pdf      Entity-Level Requirements, 78 FR 78864, 78869
                                               through the Commission’s Web site at www.cftc.gov.      (‘‘CFTC Staff Letter No. 15–15’’).                      (Dec. 27, 2013).



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                                                                       Federal Register / Vol. 81, No. 156 / Friday, August 12, 2016 / Proposed Rules                                                   53345

                                               Comparable Annual Report must be                        Report to be furnished to the                          date or a set number of days after the
                                               furnished to the CFTC.12                                Commission not more than 30 days after                 Substituted Compliance Registrant’s
                                                                                                       the submission of a Registrant’s annual                fiscal year-end. A home jurisdiction
                                               II. The Proposal
                                                                                                       financial report.15 The Commission                     requirement to complete the
                                               A Proposed Amendments to Regulation                     recognizes the separate and distinct                   Comparable Annual Report only if some
                                               3.3(f)(2)                                               nature and purposes of the two reports,                event occurs or upon request, or which
                                                  The Commission is proposing to                       and believes that allowing Registrants to              does not specify a deadline, is not
                                               codify the current no-action relief by                  submit their CCO Annual Reports not                    considered comparable to the
                                               amending Regulation 3.3(f)(2). The                      more than 30 days after their financial                Commission’s annual delivery
                                               amendments would permit an FCM to                       reports are due satisfies the statutory                requirement.
                                               furnish its CCO Annual Report to the                    requirement that the CCO Annual
                                                                                                                                                              C. Proposed Amendments Regarding a
                                               Commission not more than 30 days after                  Report ‘‘accompany’’ the other financial
                                                                                                                                                              Delegation From the Commission to the
                                               submission of the Form 1–FR–FCM 13 or                   report. This is also consistent with the
                                                                                                                                                              Division
                                               Financial Operational Combined                          SEC’s approach in its corresponding
                                                                                                       rule for delivery of chief compliance                     Pursuant to Regulation 3.3(f)(5),
                                               Uniform Single Report (‘‘FOCUS
                                                                                                       officer annual reports by security-based               Registrants may request from the
                                               Report’’). The Proposal would also
                                                                                                       swap dealers and major security-based                  Commission an extension of time to
                                               permit an SD or MSP to furnish its CCO
                                                                                                       swap participants.16                                   furnish their CCO Annual Reports if the
                                               Annual Report to the Commission not
                                                                                                                                                              failure to timely furnish the report could
                                               more than 90 days after its fiscal year-                B. Registrants Located in Substituted                  not be avoided absent ‘‘unreasonable
                                               end until such time as the Commission                   Compliance Jurisdictions                               effort or expense.’’ The rule provides the
                                               adopts and implements rules
                                                                                                          The Commission is also proposing to                 Commission with discretion in granting
                                               establishing the time for filing the
                                                                                                       amend Regulation 3.3(f) to address the                 such extensions. To expedite review
                                               annual financial condition report
                                                                                                       timing of the filing requirement for                   and consideration of requests for
                                               required under CEA section 4s(f). The
                                                                                                       Comparable Annual Reports. If the                      extensions, the Commission is
                                               Commission has proposed, but not yet
                                                                                                       requirements of the Substituted                        proposing to delegate to the Director of
                                               adopted, a financial condition report
                                                                                                       Compliance Registrant’s home                           DSIO, or such other employee(s) that the
                                               requirement comprised of an annual
                                               audited financial report for SDs and                    jurisdiction identify a specific date by               Director may designate, the authority to
                                               MSPs.14 Once the Commission adopts                      which the Comparable Annual Reports                    grant extensions of time subject to the
                                               and implements a financial condition                    must be completed, then the                            same standard set forth in Regulation
                                               report rule, like FCMs, an SD or MSP                    Commission is proposing that                           3.3(f)(5). The Commission notes that the
                                               will have up to 30 days after the                       Comparable Annual Reports may be                       exercise of such delegated authority
                                               submission of its annual financial                      furnished to the Commission                            would need to be consistent with
                                               condition report to submit the CCO                      electronically up to 15 days after the                 Regulation 3.3(f)(5) and therefore would
                                               Annual Report to the Commission.                        date on which the Comparable Annual                    be limited to unique facts and
                                                  Regulation 3.3(e) requires a broad and               Report must be completed.17 The                        circumstances that clearly demonstrate
                                               detailed assessment of each Registrant’s                additional 15 days would allow time for                that the inability to timely furnish the
                                               compliance program over the preceding                   translation of the report text into                    report to the Commission could not
                                               year as well as a discussion of planned                 English. If the Substituted Compliance                 have been eliminated absent
                                               changes and remedial steps to be taken                  Registrant’s home jurisdiction does not                unreasonable effort or expense. The
                                               for non-compliance matters. The                         establish a specifically identifiable                  Commission believes that such
                                               Commission believes that providing up                   completion date, then the Substituted                  delegation is prudent given that the
                                               to 30 days after a Registrant’s applicable              Compliance Registrant must comply                      decision to provide an extension
                                               financial reports are due would provide                 with the standard time frames provided                 requires consideration of specific facts
                                               Registrants an appropriate amount of                    in Regulation 3.3(f), as amended. A                    and circumstances and often this
                                               time to complete the in-depth review                    specifically identifiable completion date              consideration needs to occur within a
                                               and analyses required by Regulation                     would be a date that can be clearly                    relatively short period of time. As is the
                                               3.3(e). As a policy matter, the                         identified such as a specific calendar                 case with existing delegations to staff,
                                               Commission recognizes that the                                                                                 the Commission would continue to
                                               periodic self-evaluation that underlies                    15 The Proposal would remove the obligation of      reserve the right to perform the
                                                                                                       Registrants to file their CCO Annual Reports           functions described in Regulation
                                               each CCO Annual Report is a critical                    ‘‘simultaneously’’ with the applicable FCM
                                               step in promoting an active and robust                  financial report or financial condition report.
                                                                                                                                                              3.3(f)(5) itself at any time.18
                                               compliance culture within firms.                           16 In the adopting release, the SEC addresses the     The Commission requests comment
                                                  In codifying the relief provided in                  statutory language that links the filing of the CCO    on the appropriateness of the proposed
                                               CFTC Staff Letter No. 15–15, the                        Annual Report with the filing of appropriate           delegation and whether additional
                                                                                                       financial reports by stating, ‘‘The Commission is      procedural detail is necessary.
                                               Commission is clarifying that the                       interpreting ‘accompany’ in Section 15F(k)(3)(B)(i)
                                               statutory requirement for an SD or                      to mean follow within 30 days.’’ 81 FR 29959,          D. Request for Comment
                                               MSP’s CCO Annual Report to                              30059, n.1238.
                                               ‘‘accompany each appropriate financial                     17 While each of the jurisdictions that have been     The Commission seeks comments
                                               report’’ allows for the CCO Annual                      granted a comparability determination with respect     regarding the following matters:
                                                                                                       to Regulation 3.3(e) requires Substituted                • Given the current filing
                                                                                                       Compliance Registrants to produce and complete
ehiers on DSK5VPTVN1PROD with PROPOSALS




                                                 12 See note 11, supra.                                                                                       requirements for the Form 1–FR–FCM
                                                                                                       comparable annual reporting information, there is
                                                 13 The proposed amendment also makes a                variation among the foreign jurisdictions as to        and FOCUS Reports, and the anticipated
                                               technical correction in Regulation 3.3(f)(2) by         whether and/or when a Comparable Annual Report
                                               correcting the cross reference to the Commission        must be furnished to the home regulator. Therefore,      18 In addition, notwithstanding any such
                                               regulation that requires the filing of Form 1–FR–       the Commission is using the date on which the          delegation, in any case in which a Commission
                                               FCM to Regulation 1.10(b)(1)(ii).                       Comparable Annual Report must be completed as          employee delegated authority under this section
                                                 14 See Capital Requirements of Swap Dealers and       the benchmark for determining when the                 believes it is appropriate, the employee may submit
                                               Major Swap Participants, 76 FR 27802, 27838             Comparable Annual Report must be furnished to          the question to the Commission for its
                                               (proposed May 12, 2011).                                the Commission.                                        consideration.



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                                               53346                    Federal Register / Vol. 81, No. 156 / Friday, August 12, 2016 / Proposed Rules

                                               filing requirements for the financial                     displays a currently valid control                   require any additional actions to be
                                               condition report, is it appropriate to                    number issued by the Office of                       taken by Registrants. The additional 30
                                               permit FCMs, SDs, and MSPs an                             Management and Budget (‘‘OMB’’). The                 days (or up to 15 days after the date on
                                               additional 30-days to furnish their CCO                   collection of information related to this            which a Comparable Annual Report
                                               Annual Report to the Commission? Are                      proposed rule is OMB control number                  must be completed under applicable
                                               there any practical or policy reasons for                 3038–0080—Annual Report for Chief                    home jurisdiction standards that allow
                                               not permitting the additional 30 days?                    Compliance Officer of Registrants. The               more time) provided by the proposal
                                                  • Does codifying the relief granted in                 Commission believes that this proposed               lengthens the time before senior
                                               CFTC Staff Letter No. 15–15 sufficiently                  rule will not impose any new                         management or the board of the
                                               address Registrants’ concerns?                            information collection requirements that             Registrants and the Commission may
                                                  • Should the Commission provide                        require approval of OMB under the                    receive the CCO Annual Reports. The
                                               any further clarification of the                          PRA. As a general matter, the proposed               additional time to furnish the reports
                                               requirements of Regulation 3.3(f) as they                 rule would allow Registrants up to 90                should not materially impact regulatory
                                               apply to entities located in jurisdictions                days after the end of their fiscal years,            oversight given that the purpose of the
                                               for which comparability determinations                    and certain Substituted Compliance                   reports is to provide a status update for
                                               have been issued?                                         Registrants with up to 15 days after the             the Registrant’s compliance activities
                                               III. Related Matters                                      date on which the Comparable Annual                  over the course of the preceding fiscal
                                                                                                         Report must be completed under the                   year and planned changes for the
                                               A. Regulatory Flexibility Act                             requirements of their home jurisdiction,             coming year. The reports generally do
                                                  The Regulatory Flexibility Act 19                      to file the CCO Annual Report and                    not serve to address crisis situations for
                                               (‘‘RFA’’) requires that agencies consider                 Comparable Annual Reports,                           which immediacy is critical. Therefore,
                                               whether the rules they propose will                       respectively. As such, this proposed                 the additional time allowed will not
                                               have a significant economic impact on                     rule does not, by itself, impose any new             materially impact the usefulness of the
                                               a substantial number of small entities                    burden or any new information                        information in the reports.23 The
                                               and, if so, provide a regulatory                          collection requirements in addition to               Commission has no other information
                                               flexibility analysis reflecting the impact.               those that already exist in connection               available to it that would indicate that
                                               Section 3.3(f)(2), as proposed, amends                    with the preparation and delivery of the             changing the filing deadline would
                                               the filing deadline for CCO Annual                        CCO Annual Report pursuant to part 3                 measurably change the cost to prepare
                                               Reports of FCMs, SDs, and MSPs and                        of the Commission’s regulations.                     the CCO Annual Reports. Accordingly,
                                               clarifies the filing deadline for                                                                              the Commission preliminarily believes
                                                                                                         C. Cost-Benefit Considerations
                                               Comparable Annual Reports. The                                                                                 that the proposal would not impose any
                                               proposed amendments would affect                          1. Background                                        additional costs on any other market
                                               FCMs, SDs, and MSPs that are required                        As discussed above, the Commission                participants, the markets themselves, or
                                               to be registered with the Commission.                     is proposing amendments to the filing                the general public. The Commission
                                               The Commission has previously                             requirements for CCO Annual Reports                  invites comment regarding the nature of,
                                               established certain definitions of ‘‘small                in Regulation 3.3 that would: (1)                    and the extent to which, costs
                                               entities’’ to be used in evaluating the                   Increase the amount of time registrants              associated with the CCO Annual
                                               impact of its regulations on small                        have to file their CCO Annual Reports                Reports could change as a result of the
                                               entities in accordance with the RFA,                      with the Commission; and (2) clarify the             adoption of the proposal and, to the
                                               and has previously determined that                        filing requirements for Comparable                   extent they can be quantified, monetary
                                               FCMs, SDs, and MSPs are not small                         Annual Reports. The baseline for this                and other numerical estimates thereof.
                                               entities for purposes of the RFA.20                       cost and benefit consideration is                    3. Benefits
                                               Therefore, the Commission believes that                   existing Regulation 3.3. Although CFTC
                                                                                                         Staff Letter No. 15–15, as discussed                    The Commission believes that the
                                               the amendments to Regulation 3.3                                                                               proposal would provide relief for
                                               would not have a significant economic                     above, currently offers no-action relief
                                                                                                         that is substantially similar to the relief          Registrants from time pressures in
                                               impact on a substantial number of small                                                                        preparing and filing their CCO Annual
                                               entities. Accordingly, the Chairman, on                   that the proposed amendments would
                                                                                                         grant Registrants, as a no-action letter, it         Reports. The additional time provided
                                               behalf of the Commission, hereby                                                                               will allow Registrants to more carefully
                                               certifies, pursuant to 5 U.S.C. 605(b),                   only represents the position of the
                                                                                                         issuing Division or Office and cannot                complete their internal processes used
                                               that the proposed amendments will not                                                                          to develop the broad variety of
                                               have a significant economic impact on                     bind the Commission or other
                                                                                                         Commission staff.22 Consequently, the                information needed for the reports
                                               a substantial number of small entities.                                                                        resulting in more accurate and complete
                                                                                                         Commission believes that CFTC Staff
                                               B. Paperwork Reduction Act                                Letter No. 15–15 should not set or affect            reports. The Commission invites
                                                  The Paperwork Reduction Act of 1995                    the baseline against which the                       comment regarding the nature and
                                               (‘‘PRA’’) 21 provides that a federal                      Commission considers the costs and                   extent of these and any other benefits
                                               agency may not conduct or sponsor, and                    benefits of the proposal.                            that could result from adoption of the
                                               a person is not required to respond to,                                                                        proposal—including benefits to other
                                                                                                         2. Costs                                             market participants, the market itself, or
                                               a collection of information unless it
                                                                                                            The Commission received no                        the general public—and, to the extent
                                                 19 5 U.S.C. 601 et seq.                                 comments during the rulemaking                       they can be quantified, monetary and
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                                                 20 See Policy Statement and Establishment of            process for Regulation 3.3 regarding                 other numerical estimates thereof.
                                               Definitions of ‘‘Small Entities’’ for Purposes of the     costs associated with the timing of the
                                               Regulatory Flexibility Act, 47 FR 18618, 18619            filing deadline for the CCO Annual                     23 The CCO Annual Report must contain a
                                               (Apr. 30, 1982) (FCMs); Further Definition of ‘‘Swap                                                           description of material non-compliance events that
                                               Dealer,’’ ‘‘Security-Based Swap Dealer,’’ ‘‘Major
                                                                                                         Report. The proposed amendment does
                                                                                                                                                              occurred over the review period. However,
                                               Swap Participant,’’ ‘‘Major Security-Based Swap           not change the report contents or                    reporting on those events in the CCO Annual Report
                                               Participant’’ and ‘‘Eligible Contract Participant,’’ 77                                                        provides transparency regarding the effectiveness of
                                               FR 30596, 30701 (May 23, 2012) (SDs and MSPs).              22 See 17 CFR 140.99(a)(2). See also CFTC Staff    the implementation of the compliance program over
                                                 21 44 U.S.C. 3501 et seq.                               Letter No. 15–15 at 4.                               the preceding year for management and the CFTC.



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                                                                          Federal Register / Vol. 81, No. 156 / Friday, August 12, 2016 / Proposed Rules                                                53347

                                               4. Section 15(a) Factors                                   to Regulation 3.3 would not impact on                 PART 3—REGISTRATION
                                                  Section 15(a) of the CEA requires the                   price discovery. Given the fact that the
                                                                                                          proposed amendments affect only the                   ■ 1. The authority citation for part 3 is
                                               Commission to consider the costs and
                                                                                                          timing of when the CCO Annual Reports                 revised to read as follows:
                                               benefits of its actions before
                                               promulgating a regulation under the                        are filed with the Commission and the                    Authority: 5 U.S.C. 552, 552b; 7 U.S.C. 1a,
                                               CEA or issuing certain orders.24 Section                   CCO Annual Reports generally would                    2, 6a, 6b, 6b–1, 6c, 6d, 6e, 6f, 6g, 6h, 6i, 6k,
                                               15(a) further specifies that the costs and                 not contain trade information or be                   6m, 6n, 6o, 6p, 6s, 8, 9, 9a, 12, 12a, 13b, 13c,
                                                                                                          available to the public, the proposed                 16a, 18, 19, 21, 23, as amended by Title VII
                                               benefits shall be evaluated in light of
                                                                                                          amendments would not affect price                     of the Dodd-Frank Wall Street Reform and
                                               five broad areas of market and public                                                                            Consumer Protection Act, Pub. L. 111–203,
                                               concern: (1) Protection of market                          discovery.                                            124 Stat. 1376 (Jul. 21, 2010).
                                               participants and the public; (2)                           d. Sound Risk Management Practices                    ■ 2. Amend § 3.3 as follows:
                                               efficiency, competitiveness, and                                                                                 ■ a. Revise paragraph (f)(2); and
                                               financial integrity of futures markets; (3)                  The Commission preliminarily                        ■ b. Add paragraph (h).
                                               price discovery; (4) sound risk                            believes that the proposed amendments                   The revision and addition to read as
                                               management practices; and (5) other                        would not have a meaningful effect on                 follows:
                                               public interest considerations. The                        the risk management practices of
                                               Commission considers the costs and                         Registrants. While the CCO Annual                     § 3.3    Chief compliance officer.
                                               benefits resulting from its discretionary                  Reports may discuss certain risk                      *       *     *     *     *
                                               determinations with respect to the                         management aspects related to the                        (f) * * *
                                               section 15(a) factors.                                     compliance programs of the Registrants,                  (2)(i) Except as provided in paragraph
                                                                                                          the proposal would only amend the                     (f)(2)(ii) of this section, the annual
                                               a. Protection of Market Participants and
                                                                                                          timing of delivery of the reports to the              report shall be furnished electronically
                                               the Public
                                                                                                          Commission, not the contents of the                   to the Commission not more than 30
                                                  The Commission recognizes that there                                                                          days after the submission of Form 1–
                                               are trade-offs between reducing                            reports. As described above under
                                                                                                          subsection 4.a, the short delay in                    FR–FCM, as required under
                                               regulatory burdens and ensuring that                                                                             § 1.10(b)(1)(ii) of this chapter, the
                                               the Commission has sufficient, timely                      delivery of the reports provided for by
                                                                                                          the proposal is not significant given the             Financial and Operational Combined
                                               information to fulfill its regulatory                                                                            Uniform Single Report, as required
                                               mission. The proposed amendments to                        nature of the information included in
                                                                                                          the report and allowing additional time               under § 1.10(h) of this chapter, or the
                                               Regulation 3.3 are intended to reduce                                                                            financial condition report, as required
                                               some of the regulatory burdens on                          to prepare the CCO Annual Reports
                                                                                                          might allow the Registrants to prepare                under section 4s(f) of the Act, as
                                               Registrants. While the amendment will                                                                            applicable. Until such time as the
                                               delay the time by which the                                better reports that more effectively
                                                                                                                                                                Commission adopts and implements a
                                               Commission will receive the CCO                            address the information contained
                                                                                                                                                                regulation establishing the time for
                                               Annual Reports, the delay is relatively                    therein.
                                                                                                                                                                filing the financial condition report, a
                                               short given that the information in the                    e. Other Public Interest Considerations               swap dealer or major swap participant
                                               reports looks back over the entire year-                                                                         shall furnish the annual report
                                               long reporting period and identifies                         The Commission has not identified                   electronically to the Commission not
                                               planned improvements for the coming                        any other public interest considerations              more than 90 days after the end of its
                                               year. Accordingly, the Commission                          for this rulemaking.                                  fiscal year.
                                               preliminarily believes that the short                                                                               (ii) The annual report of a swap dealer
                                               delay will not affect the protection of                    5. Request for Comment
                                                                                                                                                                or major swap participant that is eligible
                                               market participants and the public.                                                                              to comply with a substituted
                                                                                                             The Commission invites comment on
                                               b. Efficiency, Competitiveness, and                        all aspects of its preliminary                        compliance regime for paragraph (e) of
                                               Financial Integrity of Markets                             consideration of the costs and benefits               this section pursuant to a comparability
                                                                                                          associated with the proposal and the                  determination of the Commission may
                                                  The Commission believes that the
                                                                                                          five factors the Commission is required               be furnished to the Commission
                                               proposed amendments to Regulation 3.3
                                                                                                          to consider under CEA section 15(a). In               electronically up to 15 days after the
                                               could improve allocational efficiency
                                               for participants in the market by                          addressing these areas and any other                  date on which the comparable annual
                                               reducing the burden of preparing the                       aspect of the Commission’s preliminary                report must be completed under the
                                               CCO Annual Report in a shorter time-                       cost-benefit considerations, the                      requirements of the applicable
                                               frame, thereby allowing them to allocate                   Commission encourages commenters to                   substituted compliance regime. If the
                                               compliance resources more efficiently                      submit any data or other information                  substituted compliance regime does not
                                               over the report preparation period. The                    they may have quantifying and/or                      specify a date by which the comparable
                                               Commission preliminarily believes that                     qualifying the costs and benefits of the              annual report must be completed, then
                                               the proposed amendments to Regulation                      proposal.                                             the annual report shall be furnished to
                                               3.3 will not have any market efficiency,                                                                         the Commission by the date specified in
                                                                                                          List of Subjects in 17 CFR Part 3                     paragraph (f)(2)(i) of this section.
                                               competitiveness, or market integrity
                                               impacts because the reports address                          Administrative practice and                         *       *     *     *     *
                                               internal compliance programs of each                                                                                (h) Delegation of Authority. The
                                                                                                          procedure, Brokers, Commodity futures,
                                                                                                                                                                Commission hereby delegates to the
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                                               Registrant and are not publicly                            Major swap participants, Reporting and
                                               available.                                                                                                       Director of the Division of Swap Dealer
                                                                                                          recordkeeping requirements, Swap
                                                                                                                                                                and Intermediary Oversight, or such
                                               c. Price Discovery                                         dealers.
                                                                                                                                                                other employee or employees as the
                                                  The Commission preliminarily                              For the reasons stated in the                       Director may designate from time to
                                               believes that the proposed amendments                      preamble, the Commodity Futures                       time, the authority to grant extensions of
                                                                                                          Trading Commission proposes to amend                  time, as set forth in paragraph (f)(5) of
                                                 24 7   U.S.C. 19(a).                                     17 CFR part 3 as follows:                             this section. Notwithstanding such


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                                               53348                    Federal Register / Vol. 81, No. 156 / Friday, August 12, 2016 / Proposed Rules

                                               delegation, in any case in which a                      DATES:  Submit comments by September                  including overseeing decommissioning.
                                               Commission employee delegated                           12, 2016. BSEE may not fully consider                 (See 30 CFR 250.101; 30 CFR part 250,
                                               authority under this paragraph believes                 comments received after this date. You                subpart Q.) To carry out its
                                               it appropriate, he or she may submit to                 may submit comments to the Office of                  responsibilities, BSEE regulates
                                               the Commission for its consideration the                Management and Budget (OMB) on the                    exploration, development, and
                                               question of whether an extension of                     information collection burden in this                 production of oil and natural gas to
                                               time should be granted. The delegation                  proposed rule by September 12, 2016.                  enhance safety and environmental
                                               of authority in this paragraph shall not                ADDRESSES: You may submit comments                    protection in a way that reflects
                                               prohibit the Commission, at its election,               on this proposed rulemaking by any of                 advancements in technology and new
                                               from exercising the authority set forth in              the following methods. Please use the                 information. BSEE also conducts onsite
                                               paragraph (f)(5) of this section.                       Regulation Identifier Number (RIN)                    inspections to ensure compliance with
                                                 Issued in Washington, DC, on August 8,                1014–AA32 as an identifier in your                    regulations, lease terms, and approved
                                               2016, by the Commission.                                message. BSEE may post all submitted                  plans or permits. Detailed information
                                               Christopher J. Kirkpatrick,                             comments on a public Web site.                        concerning BSEE’s regulations and
                                               Secretary of the Commission.                               1. Submit comments electronically via              guidance for the offshore industry may
                                                                                                       the Federal eRulemaking Portal: http://               be found on BSEE’s Web site at:
                                                 Note: The following appendix will not                 www.regulations.gov. In the entry titled              www.bsee.gov/Regulations-and-
                                               appear in the Code of Federal Regulations.                                                                    Guidance/index.
                                                                                                       ‘‘Enter Keyword or ID,’’ enter BSEE–
                                               Appendix to Chief Compliance Officer                    2016–0004, then click ‘‘Search.’’ Follow              Public Participation and Availability of
                                               Annual Report Requirements for                          the instructions to submit public                     Comments
                                               Futures Commission Merchants, Swap                      comments and view supporting and
                                                                                                                                                                BSEE encourages you to participate in
                                               Dealers, and Major Swap Participants;                   related materials available for this
                                                                                                                                                             this proposed rulemaking by submitting
                                               Amendments to Filing Dates—                             proposed rulemaking.
                                                                                                                                                             written comments, as discussed in the
                                               Commission Voting Summary                                  2. Mail or hand-carry comments to the
                                                                                                                                                             ADDRESSES and DATES sections of this
                                                                                                       Department of the Interior (DOI); Bureau
                                                 On this matter, Chairman Massad and                                                                         proposed rule. This proposed rule
                                                                                                       of Safety and Environmental
                                               Commissioners Bowen and Giancarlo voted                                                                       provides 30 days for public comment for
                                                                                                       Enforcement; Attention: Regulations
                                               in the affirmative. No Commissioner voted in                                                                  the following reasons. The need for
                                               the negative.                                           and Standards Branch; 45600 Woodland
                                                                                                                                                             submission of actual decommissioning
                                                                                                       Road, Sterling, VA 20166, VAE–ORP.
                                               [FR Doc. 2016–19231 Filed 8–11–16; 8:45 am]                                                                   cost information for plugging wells,
                                                                                                       Please reference ‘‘Decommissioning
                                               BILLING CODE 6351–01–P                                                                                        removing platforms, and clearing of
                                                                                                       Costs for Pipelines, 1014–AA32’’ in
                                                                                                                                                             sites was explained in a proposed rule
                                                                                                       your comments and include your name
                                                                                                                                                             published on May 27, 2009 (74 FR
                                                                                                       and return address.                                   25177) and a final rule published on
                                               DEPARTMENT OF THE INTERIOR                                 3. Comments on the information
                                                                                                                                                             December 4, 2015 (80 FR75806). That
                                                                                                       collection contained in this proposed
                                               Bureau of Safety and Environmental                                                                            final rule addressed and responded to
                                                                                                       rule should be submitted separately
                                               Enforcement                                                                                                   all of the relevant comments submitted
                                                                                                       from those on the substance of the                    on the proposed rule. This proposed
                                                                                                       proposed rule. Send comments on the                   rule would extend the existing
                                               30 CFR Part 250
                                                                                                       information collection burden in this                 requirements for submitting summaries
                                               [Docket ID: BSEE–2016–0004; 16XE1700DX                  proposed rule to: OMB, Interior Desk                  of actual decommissioning costs (30
                                               EEEE500000 EX1SF0000.DAQ000]                            Officer 1014–AA32, 202–395–5806                       CFR 250.1704(i) and (j)) to pipelines.
                                               RIN 1014–AA32                                           (fax); or email: OIRA_submission@                     The reasons for this proposed rule, as
                                                                                                       omb.eop.gov. Please send a copy of your               discussed in the Background and
                                               Oil and Gas and Sulfur Operations in                    comments to BSEE using one of the                     Purpose of Proposed Amendment
                                               the Outer Continental Shelf—                            methods previously described.                         sections of this notice are effectively the
                                               Decommissioning Costs for Pipelines                     FOR FURTHER INFORMATION CONTACT:                      same for pipelines as the reasons
                                               AGENCY:  Bureau of Safety and                           Betty Cox, Regulatory Analyst,                        discussed in the December 4, 2016 rule
                                               Environmental Enforcement,                              Regulations and Standards Branch,                     for the reporting of decommissioning
                                               Department of the Interior.                             Betty.Cox@bsee.gov, (703) 787–1616.                   costs for other facilities. BSEE does not
                                               ACTION: Proposed rule.                                  SUPPLEMENTARY INFORMATION:                            expect that public comments on this
                                                                                                                                                             proposed rule are likely to raise any
                                                                                                       BSEE’s Functions and Authority
                                               SUMMARY:    The Bureau of Safety and                                                                          significant issues that were not raised in
                                               Environmental Enforcement (BSEE)                          BSEE promotes safety, protects the                  the earlier decommissioning cost
                                               proposes to amend the regulations                       environment, and conserves natural                    reporting rulemaking. Moreover, the
                                               requiring lessees and owners of                         resources through vigorous regulatory                 affected stakeholders in the oil and gas
                                               operating rights to submit summaries of                 oversight and enforcement of certain                  industry are already familiar with the
                                               actual decommissioning expenditures                     activities on the OCS. BSEE derives its               terms and requirements of the existing
                                               incurred for certain decommissioning                    authority primarily from the Outer                    decommissioning cost reporting rule,
                                               activities related to oil and gas and                   Continental Shelf Lands Act (OCSLA),                  which would apply without change to
                                               sulfur operations on the Outer                          43 U.S.C. 1331–1356a. Congress enacted                pipelines under this proposed rule.
                                               Continental Shelf (OCS). The proposed                   OCSLA in 1953, codifying Federal
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                                                                                                                                                             Accordingly, BSEE has determined that
                                               rule would expand the scope of the                      control over the OCS and authorizing                  30 days provides a reasonable and
                                               current regulations to require lessees,                 the Secretary of the Interior (Secretary)             adequate opportunity for the public to
                                               owners of operating rights, and right-of-               to regulate oil and natural gas                       comment on this proposed rule.
                                               way (ROW) holders to submit                             exploration, development, and                            Before including your address, phone
                                               summaries of actual expenditures                        production operations on the OCS. The                 number, email address, or other
                                               incurred for pipeline decommissioning                   Secretary has authorized BSEE to                      personal identifying information in your
                                               activities.                                             perform certain of these functions,                   comment on this proposed rule,


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Document Created: 2018-02-09 11:33:01
Document Modified: 2018-02-09 11:33:01
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionProposed Rules
ActionNotice of proposed rulemaking.
DatesComments must be received on or before September 12, 2016.
ContactEileen Flaherty, Director, 202-418- 5326, [email protected]; Erik Remmler, Deputy Director, 202-418-7630, [email protected]; Laura Gardy, Associate Director, 202-418-7645, [email protected]; or Pamela M. Geraghty, Special Counsel, 202-418-5634, [email protected], Division of Swap Dealer and Intermediary Oversight, Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581.
FR Citation81 FR 53343 
RIN Number3038-AE49
CFR AssociatedAdministrative Practice and Procedure; Brokers; Commodity Futures; Major Swap Participants; Reporting and Recordkeeping Requirements and Swap Dealers

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