Amendments to the Commission's Rules of Practice, 60082-60091 [2015-24705]
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Federal Register / Vol. 80, No. 192 / Monday, October 5, 2015 / Proposed Rules
§ 107.720 Small Businesses that may be
ineligible for financing.
PART 107—SMALL BUSINESS
INVESTMENT COMPANIES
*
1. The authority citation for part 107
is revised to read as follows:
■
Authority: 15 U.S.C. 681, 683, 687(c),
687b, 687d, 687g, 687m.
§ 107.50
[Amended]
2. Amend § 107.50 by removing from
the definition of ‘‘Lending Institution’’
the term ‘‘Associates’s’’ and adding in
its place the term ‘‘Associate’s’’.
■ 3. Amend § 107.210 by revising the
paragraph (a) introductory text to read
as follows:
■
§ 107.210 Minimum capital requirements
for Licensees.
(a) Companies licensed on or after
October 1, 1996. A company licensed on
or after October 1, 1996, must have
Leverageable Capital of at least
$2,500,000 and must meet the
applicable minimum Regulatory Capital
requirement in this paragraph (a), unless
lower Leverageable Capital and
Regulatory Capital amounts are
approved by SBA as part of a Wind-Up
Plan in accordance with § 107.590(c):
*
*
*
*
*
■ 4. Amend § 107.503 by revising the
last sentence of paragraph (a) to read as
follows:
§ 107.503 Licensee’s adoption of an
approved valuation policy.
(a) * * * These guidelines may be
obtained from SBA’s SBIC Web site at
www.sba.gov/inv.
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*
*
*
■ 5. Amend § 107.610 by adding
paragraph (g) to read as follows:
§ 107.610 Required certifications for Loans
and Investments.
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*
*
*
*
(g) For each passive business financed
under § 107.720(b)(3), a certification by
you, dated as of the closing date of the
Financing, as to the basis for the
qualification of the Financing under
§ 107.720(b)(3) and identifying one or
more limited partners in which a direct
Financing would cause those investors
to incur ‘‘unrelated business taxable
income’’ under section 511 of the
Internal Revenue Code (26 U.S.C. 511)
or ‘‘effectively connected income’’ to
foreign investors under sections 871 and
882 of the Internal Revenue Code (26
U.S.C. 871 and 882).
§ 107.630
[Amended]
6. Amend § 107.630 by removing
paragraph (d) and redesignating
paragraph (e) as paragraph (d).
■ 7. Amend § 107.720 by revising
paragraphs (b)(2) and (b)(3) and adding
paragraph (b)(4) to read as follows:
■
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(b) * * *
(2) Exception for pass-through of
proceeds to subsidiary. You may
provide Financing directly to a passive
business, including a passive business
that you have formed, if it is a Small
Business and it passes substantially all
the proceeds through to (or uses
substantially all the proceeds to acquire)
one or more subsidiary companies, each
of which is an eligible Small Business
that is not passive. For the purpose of
this paragraph (b)(2), ‘‘subsidiary
company’’ means a company in which
the financed passive business either:
(i) Directly owns, or will own as a
result of the Financing, at least 50
percent of the outstanding voting
securities; or
(ii) Indirectly owns, or will own as a
result of the Financing, at least 50
percent of the outstanding voting
securities (by directly owning the
outstanding voting securities of another
passive Small Business that is the direct
owner of the outstanding voting
securities of the subsidiary company).
(3) Exception for certain Partnership
Licensees. If you are a Partnership
Licensee, you may form one or more
wholly-owned corporations in
accordance with this paragraph (b)(3).
The sole purpose of such corporation(s)
must be to provide Financing to one or
more eligible, unincorporated Small
Businesses. You may form such
corporation(s) only if a direct Financing
to such Small Businesses would cause
any of your investors to incur
‘‘unrelated business taxable income’’
under section 511 of the Internal
Revenue Code (26 U.S.C. 511) or
‘‘effectively connected income’’ to
foreign investors under sections 871 and
882 of the Internal Revenue Code (26
U.S.C. 871 and 882). Your ownership
and investment of funds in such
corporation(s) will not constitute a
violation of § 107.730(a). For each
passive business financed under this
section 107.720(b)(3), you must provide
a certification to SBA as required under
§ 107.610(g). The wholly-owned
corporation(s) formed under this
paragraph may provide Financing:
(i) Directly to one or more eligible
non-passive Small Businesses; or
(ii) Directly to a passive Small
Business that passes substantially all the
proceeds directly to (or uses
substantially all the proceeds to acquire)
one or more eligible non-passive Small
Businesses which the passive Small
Business directly owns, or will own as
a result of the Financing, at least 50%
of the outstanding voting securities.
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(4) Additional conditions for
permitted passive business financings.
Financings permitted under paragraphs
(b)(2) or (b)(3) of this section must meet
all of the following conditions:
(i) For the purposes of this paragraph
(b), ‘‘substantially all’’ means at least
ninety-nine percent of the Financing
proceeds after deduction of actual
application fees, closing fees, and
expense reimbursements which may not
exceed those permitted by § 107.860.
(ii) If you and/or your Associate
charge fees permitted by §§ 107.860
and/or 107.900, the total amount of such
fees charged to all passive and nonpassive businesses that are part of the
same Financing may not exceed the fees
that would have been permitted if the
Financing had been provided directly to
a non-passive Small Business. Any such
fees received by your Associate must be
paid to you in cash within 30 days of
the receipt of such fees.
(iii) For the purposes of this part 107,
each passive and non-passive business
included in the Financing is a Portfolio
Concern. The terms of the financing
must provide SBA with access to
Portfolio Concern information in
compliance with this part 107,
including without limitation §§ 107.600
and 107.620.
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*
*
§ 107.1100
[Amended]
8. Amend § 107.1100 by removing the
term ‘‘Yu’’ in the second to the last
sentence of paragraph (b) and adding in
its place ‘‘You’’, and by removing
paragraph (c).
■
Dated: September 21, 2015.
Maria Contreras-Sweet,
Administrator.
[FR Doc. 2015–25232 Filed 10–2–15; 8:45 am]
BILLING CODE 8025–01–P
SECURITIES AND EXCHANGE
COMMISSION
17 CFR Part 201
[Release No. 34–75977; File No. S7–19–15]
RIN 3235–AL87
Amendments to the Commission’s
Rules of Practice
Securities and Exchange
Commission.
ACTION: Proposed rule.
AGENCY:
The Securities and Exchange
Commission (‘‘Commission’’) is
proposing for public comment
amendments to its Rules of Practice that
would require persons involved in
SUMMARY:
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administrative proceedings to submit all
documents and other items
electronically. The proposed
amendments are intended to enhance
the accessibility of administrative
proceedings by ensuring that filings and
other information concerning
administrative proceedings are more
readily available to the public.
Comments should be received on
or before December 4, 2015.
DATES:
Comments may be
submitted by any of the following
methods:
ADDRESSES:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/proposed.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number S7–
19–15 on the subject line; or
• Use the Federal eRulemaking Portal
(https://www.regulations.gov). Follow the
instructions for submitting comments.
Paper Comments
• Send paper comments to Secretary,
Securities and Exchange Commission,
100 F Street NE., Washington, DC
20549–1090.
All submissions should refer to File
Number S7–19–15. This file number
should be included on the subject line
if email is used. To help us process and
review your comments more efficiently,
please use only one method of
submission. The Commission will post
all comments on the Commission’s
Internet Web site (https://www.sec/gov/
rules/proposed.shtml). Comments are
also available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. All comments received
will be posted without change; we do
not edit personal identifying
information in submissions. You should
submit only information that you wish
to make available publicly.
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FOR FURTHER INFORMATION CONTACT:
Adela Choi, Senior Counsel, and Laura
Jarsulic, Associate General Counsel,
Office of the General Counsel, (202)
551–5150, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549.
The
Commission proposes to amend its
Rules of Practice. The amendments are
being proposed as a result of the
Commission’s experience with its
existing rules.
SUPPLEMENTARY INFORMATION:
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I. Introduction
The Commission proposes to make
targeted amendments to its Rules of
Practice that would automate and
modernize aspects of the filing process
in administrative proceedings to
facilitate the flow of information to the
public. The Commission recognizes the
need to ensure that public
administrative proceeding records are
made available to the public as quickly
as possible. Roughly 100 requests for
records related to administrative
proceedings were made each year over
the last three years, and certain records
were requested by multiple members of
the public.
The Commission currently is
developing a comprehensive Internetbased electronic system that would,
among other things, allow persons in
administrative proceedings to file and
serve documents electronically and
facilitate the prompt distribution of
public information regarding
administrative proceedings. In
conjunction with the development of
this system, the Commission proposes
to require electronic submissions. The
Commission believes that electronic
submissions will enhance the
transparency of administrative
proceedings by providing a quicker way
for the Commission to make records
available to the public. In addition, the
Commission believes that the electronic
system will increase its ability to
efficiently process filings, and may
decrease costs for parties who may file
and serve submissions electronically,
rather than in paper format.1
There are three main components to
the proposed approach. First, persons
involved in administrative proceedings
who currently are required to file
documents under Rules 151 and 152 of
the Commission’s Rules of Practice
would be required to file such
documents electronically through a
secure system on the Commission’s Web
site at www.sec.gov that is designed to
receive uploads of documents and
attachments. Filing by facsimile and in
paper format would no longer be
permitted absent the filing of a
certification that the person reasonably
cannot comply with the electronic filing
requirement. However, as discussed
further below, for the first 90 days after
the proposed amendments become final,
1 As part of the ongoing effort to make records
available to the public promptly, the Commission
now posts on its Web site more types of documents
associated with administrative proceedings, such as
significant pleadings filed by parties. Previously,
only documents issued by the Commission and
Administrative Law Judges, such as adjudicatory
initial decisions, opinions, and orders, were posted
on the Web site.
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the Commission intends to administer a
phase-in period that would require all
filings to be made both electronically
and in paper format. Second, parties
that are required to serve documents
under Rule 150 would be required to
serve each other electronically in the
form and manner that is prescribed in
the guidance posted on the
Commission’s Web site.
The third component would require
filers to exclude or redact sensitive
personal information from electronic
filings and submissions in accordance
with the Commission’s obligation to
protect such information under the
Privacy Act of 1974, as amended.2
Sensitive personal information would
be defined as a Social Security number,
taxpayer identification number,
financial account number, credit card or
debit card number, passport number,
driver’s license number, state-issued
identification number, home address
(other than city and state), telephone
number, date of birth (other than year),
names and initials of minor children, as
well as any sensitive health information
identifiable by individual, such as an
individual’s medical records. There are
exceptions to this proposed definition.
Specifically, persons need not redact the
last four digits of a taxpayer
identification number, financial account
number, credit card or debit card
number, passport number, driver’s
license number, and state-issued
identification number. Nor would
persons need to redact home addresses
and telephone numbers of parties and
persons filing documents with the
Commission; business telephone
numbers; and copies of unredacted
filings by regulated entities or
registrants that are available on the
Commission’s public Web site. The
definition of sensitive personal
information would not include a
personal email address. We seek
comments about whether the disclosure
of personal email addresses generally
and home addresses of parties and
persons filing documents with the
Commission could have an adverse
2 5 U.S.C. 552a. Federal courts and certain federal
agencies require the exclusion or redaction of
certain sensitive personal information contained in
filings. See, e.g., Fed. R. Civ. P. 5.2 (Privacy
Protection for Filings Made with the Court);
Consumer Financial Protection Bureau, Rules of
Practice for Adjudication Proceedings, Rule 112, 12
CFR 1081.112 (Formal Requirements as to Papers
Filed); National Labor Relations Board, E-Filing
Terms for Selected Documents in Unfair Labor
Practice and Representation Cases, available at
https://www.nlrb.gov/sites/default/files/
attachments/basic-page/node-1673/electronic_
filings.pdf (last visited Sept. 10, 2015). The
electronic filings and submissions discussed herein
are systems of records that the Commission has
previously identified as covered by the Privacy Act.
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effect on persons or parties, and
whether, as a result, these terms should
be included in the definition of
sensitive personal information that must
be excluded or redacted.
If the person making a filing believes
that sensitive personal information is
necessary to the proceeding, the person
would need to file a motion for a
protective order in accordance with
Rule 322 to limit disclosure of the
sensitive personal information. In
accordance with the proposed
amendments to Rule 322, and only if
review of the documents is necessary to
a ruling on the motion, the person
would be required to file an unredacted
version of the submission to be used by
the hearing officer and the Commission
for purposes of the proceeding, and a
redacted version to be used for
distribution to the public. A redacted
version would not need to be filed if the
submission would be redacted in its
entirety. This reflects current practice
when parties file motions for protective
orders pursuant to the Rules of Practice.
As a corollary to incorporating
electronic filings into the Rules of
Practice, self-regulatory organizations
and the Public Company Accounting
Oversight Board (‘‘PCAOB’’) would be
required to file electronically with the
Commission a copy of a record that is
the subject of an appeal.
II. Discussion of Proposed Amendments
The proposed amendments are as
follows:
A. Proposed Amendments to Rule 140
Rule 140 3 requires the Secretary or
other authorized person to sign
Commission orders and decisions. The
proposed amendment would clarify that
the signature may be an electronic
signature. An electronic signature could
consist of an ‘‘/s/’’ notation or any other
digital signature.
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B. Proposed Amendments to Rule 151
Rule 151(a) 4 currently sets forth the
procedural requirements for filing
papers with the Commission. The
proposed amendment would require a
person to make filings electronically
pursuant to the requirements of Rule
152(a).5 Filing by facsimile and in paper
format would no longer be permitted
absent a certification filed under Rule
152(a)(1) that explains why the person
reasonably cannot comply with the
electronic filing requirement. During a
90-day phase-in period after adoption,
CFR 201.140.
CFR 201.151(a).
5 17 CFR 201.152(a).
filings would have to be made in both
paper and electronic format.
Rule 151(d) 6 would be amended to
include an email address in the
certificate of service for those parties
served by email.
Proposed new Rule 151(e) 7 would
require persons to exclude or redact
sensitive personal information, which
would be defined as a Social Security
number, taxpayer identification number,
financial account number, credit card or
debit card number, passport number,
driver’s license number, state-issued
identification number, home address
(other than city and state), telephone
number, date of birth (other than year),
names and initials of minor children, as
well as any sensitive health information
identifiable by individual, such as an
individual’s medical records. There
would be three exceptions to the
definition. First, persons may, but
would not be required to, exclude or
redact the last four digits of a taxpayer
identification number, financial account
number, credit card or debit card
number, passport number, driver’s
license number, and state-issued
identification number. Second, persons
would not be required to redact home
addresses and telephone numbers of
parties and persons filing documents
with the Commission. Third, persons
would not be required to redact any
information from copies of filings by
regulated entities or registrants that are
available on the Commission’s public
Web site. All filings must include a
certification that any sensitive personal
information has been excluded or
redacted from the filing or, if necessary
to the filing, has been filed under seal
pursuant to Rule 322.
If the person making a filing believes
that sensitive personal information is
necessary to the proceeding, the person
would need to file a motion for a
protective order in accordance with
Rule 322 8 to limit disclosure of the
sensitive personal information. If review
of the documents that are the subject of
a motion for a protective order is
necessary to a ruling on the motion, the
proposed amendment to Rule 322
would require a person to file an
unredacted version of the submission to
be used by the hearing officer and the
Commission for purposes of the
proceeding, and a redacted version to be
used for distribution to the public. The
unredacted version would be required
to have the confidential information
marked and include the words ‘‘Under
Seal’’ on the first page of the document.
3 17
6 17
4 17
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CFR 201.151(d).
CFR 201.151(e).
8 17 CFR 201.322.
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The redacted version would be required
to be identical in all other respects to
the unredacted version. A person would
not be required to file a redacted version
if the submission would be redacted in
its entirety. This process would be
required for all kinds of motions for
protective orders made pursuant to Rule
322, i.e., not just those motions filed
regarding sensitive personal
information.
C. Proposed Amendments to Rule 152
Like Rule 151, the proposed
amendments to Rule 152(a) would make
clear that all filings shall be made
electronically. Rule 152(a) would direct
persons to follow guidance issued by
the Secretary on the Commission’s Web
site at www.sec.gov. For example, the
guidance would provide instructions on
how to file electronically through a
secure system on the Commission’s Web
site or other means; information about
the Commission’s Privacy Act
obligations, including information about
a filer’s responsibilities to redact
sensitive personal information; and the
terms and conditions of using the Web
site. Generally speaking, persons would
use the secure system on the
Commission’s Web site pursuant to Rule
152 to file documents, such as briefs
and motions and their attachments,
petitions for review, and applications
for review. Under Rule 152(a), papers
would need to be filed on the secure
system before midnight Eastern Time, as
opposed to 5:30 p.m. Eastern Time, the
current deadline for filing papers.
The Commission recognizes that a
person involved in an administrative
proceeding may be unable to submit
documents electronically during either
the entire proceeding or a portion
thereof. For example, a person who is
incarcerated at the time of the
proceeding may not have access to the
Internet or other electronic media
necessary to file documents through the
Commission’s secure system. There may
be other reasons why a person
reasonably cannot comply with the
electronic filing requirement.
A person who reasonably cannot
comply with the requirement must file
a certification under Rule 152(a)(1) that
explains why the person reasonably
cannot comply. The filing also must
indicate the expected duration of the
person’s reasonable inability to comply,
such as whether the certification is
intended to apply to a solitary filing or
all filings made during the proceeding.
The certification is immediately
effective. Upon filing the certification, it
will be part of the record of the
proceeding, and the person may file
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paper documents by any additional
method listed in Rule 152(d).
Rule 152(a) would be amended to
provide additional methods of filing if
a person reasonably cannot comply with
the electronic filing requirements. Filers
should take note that the Commission
would need to receive mailed,
couriered, or hand-delivered filings by
5:30 p.m. Eastern Time because the
Commission is unable to accept such
filings after that time. The Commission
would need to receive facsimile
transmissions by midnight Eastern
Time.
The proposed amendment also would
provide that electronic filings that
require a signature pursuant to Rule
153 9 may be signed with an ‘‘/s/’’
notation, which shall be deemed the
signature of the person making the filing
for purposes of Rule 153.
D. Proposed Amendments to Rule 351
Rule 351 10 currently sets forth the
requirements regarding the transmittal
of documents to the Secretary and the
preparation, issuance, and certification
of a record index. Rule 351(b) 11 requires
the hearing officer to transmit to the
Secretary an index of the originals of
any motions, exhibits or any other
documents filed with or accepted into
evidence by the hearing officer that have
not been previously transmitted to the
Secretary. The Secretary then shall
prepare a record index and transmit it
to the hearing officer and serve a copy
on each party. Any person may file
proposed corrections to the record index
with the hearing officer within fifteen
days of service of the record index. The
proposed amendment to Rule 351(b)
would reduce that amount of time to
three days but would provide persons
who oppose the proposed corrections
three days to file an opposition.
Proposed new Rule 351(c) 12 would
state that, no later than five days after
the Secretary serves a final record index,
the parties shall submit electronically,
through the same secure system used for
filings under Rules 151 and 152, copies
of all exhibits that were admitted, or
offered and not admitted, during the
hearing, and any other exhibits that
were admitted after the hearing. The
parties shall submit such evidence in
the form and manner that is prescribed
in the guidance posted on the
Commission’s Web site and shall certify
that exhibits and other documents or
items submitted to the Secretary are true
and accurate copies of exhibits that
9 17
CFR 201.153.
CFR 201.351.
11 17 CFR 201.351(b).
12 17 CFR 201.351(c).
10 17
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were admitted, or offered and not
admitted, during the hearing. Generally
speaking, parties would follow Rule 351
to submit record exhibits and other
documents or items that are not
attached to filings, i.e., materials
accepted into evidence by a hearing
officer under Rule 351 in connection
with an in-person hearing. As under
Rule 151(a), the submission deadline
depends on the method of delivery that
is used.
As under Rule 151(e), the proposed
amendment to Rule 351(c) would set
forth the same definition of sensitive
personal information, require its
redaction or omission from all
submissions under Rule 351, provide a
process for seeking a protective order
under Rule 322 with respect to sensitive
personal information that is necessary to
the proceeding, and require a
certification that sensitive personal
information has been excluded or
redacted or filed under seal. A person
who reasonably cannot submit exhibits
electronically must file a certification
under Rule 351(c)(2) that explains why
the person reasonably cannot comply.
The filing also must indicate the
expected duration of the person’s
reasonable inability to comply, such as
whether the certification is intended to
apply to a solitary submission or all
submissions made during the
proceeding. The certification is
immediately effective. Upon filing the
certification, it will be part of the record
of the proceeding, and the person shall
submit originals of any exhibits that
have not already been submitted to the
Secretary by other means. Rule 351(c)
also would state that electronic
submissions that require a signature
pursuant to Rule 153 may be signed
with an ‘‘/s/’’ notation, which shall be
deemed the signature of the person
making the filing for purposes of Rule
153.
E. Phase-In Period
For the first 90 days after the
proposed amendments become final, the
Commission intends to administer a
phase-in period that would require all
filings to be made both electronically
and in paper format. The Commission
preliminarily believes that a 90-day
phase-in period is a reasonable amount
of time for persons to become proficient
in the electronic filing procedures while
ensuring that the Commission receives
the filing should there be an electronic
transmission failure. However, it may be
appropriate to extend the phase-in
period if persons are experiencing
substantial difficulties with the
electronic filing.
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F. Other Proposed Amendments
Rule 150(c) 13 would be amended to
require parties to serve each other
electronically in the form and manner
that is prescribed in the guidance posted
on the Commission’s Web site.
Electronic service by email is a practice
that appears to occur already in
administrative proceedings. Electronic
service would need to occur
contemporaneously with filing, and the
timing of service would therefore differ
depending on the filing method. As
with electronic filing, a party who
reasonably cannot comply with the
electronic service requirement must file
a certification under Rule 150(c)(1) that
explains why the person reasonably
cannot comply. The filing also must
indicate the expected duration of the
person’s reasonable inability to comply,
such as whether the certification is
intended to apply to a solitary instance
of service or all instances of service
made during the proceeding. The
certification is immediately effective.
Upon filing the certification, it will be
part of the record of the proceeding, and
the person may serve paper documents
by any additional method listed in Rule
150(d). Rule 150(d) would be amended
to provide additional methods of service
if a person reasonably cannot comply
with the electronic service
requirements, or if service is of an
investigative subpoena pursuant to 17
CFR 203.8. Under Rule 150(e),14
electronic service would be deemed
complete upon transmission.
Rule 141(b) 15 would be amended to
allow the Secretary to serve orders and
decisions, other than an order
instituting proceedings, electronically.
Currently, Rule 102(d) 16 requires a
person to provide to the Commission
certain contact information that may be
used during an administrative
proceeding. The proposed amendment
clarifies that a mailing address and an
email address shall be provided under
paragraphs (d)(1), (d)(2), and (d)(4).17
Rule 193 18 currently provides that an
original and three copies of an
application shall be filed under Rules
151, 152, and 153, and that such
application shall be supported by a
manually signed affidavit. The proposed
amendment would delete the term
‘‘manually,’’ delete the reference to one
original and three copies, and leave the
13 17
CFR 201.150(c).
CFR 201.150(e).
15 17 CFR 201.141(b).
16 17 CFR 201.102(d).
17 17 CFR 201.102(d)(1), (d)(2), (d)(4).
18 17 CFR 201.193.
14 17
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cross reference to Rules 151, 152, and
153 to account for electronic filing.
Rule 420 19 sets forth the requirements
regarding appeals of determinations by
self-regulatory organizations. Currently,
Rule 420(e) 20 requires a self-regulatory
organization to certify and file with the
Commission one copy of the record
upon which the action complained of
was taken, to file with the Commission
three copies of an index to such record,
and to serve upon each party one copy
of the index within fourteen days after
receiving an application for review or a
Commission order for review. The
proposed amendment would require the
self-regulatory organization to file such
information electronically. Further, if
such information contains sensitive
personal information, the self-regulatory
organization would be required to file
electronically a copy of the record and
index that redacts or omits the sensitive
personal information and to certify that
any sensitive personal information has
been excluded or redacted. The
requirements for filing and serving
would continue to be governed by Rules
150–152.
Rule 440 21 sets forth the requirements
regarding appeals of determinations by
the PCAOB. Rule 440(d) 22 currently
requires the PCAOB to certify and file
with the Commission one copy of the
record upon which it took the
complained of action, to file with the
Commission three copies of an index to
such record, and to serve upon each
party one copy of the index within
fourteen days after receiving an
application for review. The proposed
amendment would require the PCAOB
to file such information electronically.
Further, if such information contains
sensitive personal information, the
PCAOB would be required to file
electronically a redacted copy of the
record and index that redacts or omits
the sensitive personal information and
to certify that any sensitive personal
information has been excluded or
redacted. The requirements for filing
and serving would continue to be
governed by Rules 150–152.
The United States Postal Service
changed the name of the product known
as Express Mail to Priority Mail Express.
Rule 141(a)(2)(i), (ii), (iii), (vi), (a)(3) and
Rule 150(a)(2), (d) would be amended to
refer generically to ‘‘express mail.’’
III. Request for Public Comment
We request and encourage any
interested person to submit comments
19 17
CFR 201.420.
CFR 201.420(e).
21 17 CFR 201.440.
22 17 CFR 201.440(d).
20 17
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regarding: (1) The definition of sensitive
personal information, (2) the potential
adverse effects, if any, of disclosing
personal email addresses and home
addresses of parties and persons filing
documents with the Commission, (3)
alternative approaches to handling
personal email addresses and home
addresses of parties and persons filing
documents with the Commission, (4) the
other proposed changes that are the
subject of this release, (5) additional or
different changes, or (6) other matters
that may have an effect on the proposals
contained in this release.
IV. Administrative Procedure Act,
Regulatory Flexibility Act, and
Paperwork Reduction Act
The Commission finds, in accordance
with Section 553(b)(3)(A) of the
Administrative Procedure Act,23 that
these revisions relate solely to agency
organization, procedure, or practice.
They are therefore not subject to the
provisions of the Administrative
Procedure Act requiring notice,
opportunity for public comment, and
publication. The Regulatory Flexibility
Act 24 therefore does not apply.25
Nonetheless, the Commission has
determined that it would be useful to
publish these proposed rules for notice
and comment before adoption. Because
these rules relate to ‘‘agency
organization, procedure or practice that
does not substantially affect the rights or
obligations of non-agency parties,’’ they
are not subject to the Small Business
Regulatory Enforcement Fairness Act.26
To the extent these rules relate to
agency information collections during
the conduct of administrative
proceedings, they are exempt from
review under the Paperwork Reduction
Act.27
V. Economic Analysis
The Commission is sensitive to the
costs and benefits of its rules. The
current processes and filing
requirements for administrative
proceedings serve as the baseline
against which the economic impacts of
the proposed rules are measured. At
present, submissions are permitted to be
filed with the Commission in paper
format or by facsimile followed by a
paper submission. The Commission’s
current Rules of Practice do not identify
sensitive personal information that must
be redacted from these documents by
23 5
U.S.C. 553(b)(3)(A).
U.S.C. 601–612.
25 See 5 U.S.C. 603.
26 5 U.S.C. 804(3)(C).
27 See 44 U.S.C. 3518(c)(1)(B)(ii); 5 CFR 1320.4
(exempting collections during the conduct of
administrative proceedings or investigations).
24 5
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those who file them. Instead, such
redaction is undertaken by the
Commission when necessary in
responding to document requests from
the public or posting documents on the
Commission’s public Web site. Service
by email is already generally an
accepted practice by parties to
administrative proceedings who
mutually agree to it, although it is not
expressly permitted by rule.
The scope of the benefits and costs of
the proposed rules depends on the
expected volume of administrative
proceedings and the number of filed
documents and document requests
associated with these proceedings. In
fiscal year 2014, 230 new administrative
proceedings were initiated and not
settled immediately. New proceedings
initiated and not immediately settled in
fiscal years 2013 and 2012 totaled 202
and 207 respectively.28 From 2011 to
2013, an average of approximately 1,900
filings were submitted per fiscal year in
relation to litigated proceedings,
including filings by outside parties as
well as Commission staff. These filings
consist of one or more documents, such
as motions, briefs, and record exhibits,
and the length of the filings generally
ranges from one page to a few thousand
pages. The Commission also received
numerous requests from the public to
release documents related to these
proceedings. Requests for records
related to administrative proceedings
(both settled and litigated) numbered
127, 83, and 100 for fiscal years 2013,
2012, and 2011 respectively.
The implementation of electronic
filing and the related proposed rules are
intended to improve the efficiency and
transparency of the Commission’s
operations and to modernize the
document management process to be
consistent with common practice in
other tribunals. Benefits of the proposed
rules are anticipated to accrue to the
public and outside parties to
administrative proceedings as well as
the Commission.
Specifically, the proposed rules may
benefit members of the public with an
interest in the Commission’s
administrative proceedings by
permitting the Commission to more
28 The total number of administrative proceedings
initiated and not immediately settled each fiscal
year encompasses a variety of types of proceedings,
including proceedings instituted pursuant to
Section 12(j) of the Securities Exchange Act of 1934
seeking to determine whether it is necessary and
appropriate for the protection of investors to
suspend or revoke the registration of an issuer’s
securities and proceedings instituted under Section
15(b) of the Exchange Act or Section 203(f) of the
Investment Advisers Act of 1940 seeking to
determine what, if any, remedial action is
appropriate in the public interest.
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quickly make public the documents
relating to these proceedings. The
proposed rules may increase the speed
at which information from
administrative proceedings is
transmitted as well as the overall
transparency of these proceedings.
Additionally, parties to administrative
proceedings may benefit from the
increased flexibility enabled by the
changes, such as the Commission’s
acceptance of electronic and facsimile
submissions until midnight rather than
the close of business on a given day.
These parties may also benefit from
savings on printing and mailing costs
because, after the phase-in period, filing
paper copies generally will not be
required. In addition, the changes
expressly require service by electronic
means, which may increase further the
savings in printing and mailing. The
Commission’s response to document
requests is expected to be more timeand cost-effective due to the efficiency
of electronic retrieval and the fact that
sensitive information will have been
redacted in advance. However, the
magnitude of the above benefits is
difficult to quantify due to the
limitations of existing data.
The costs of the proposal will be
borne by the Commission as well as the
outside parties to administrative
proceedings. The proposed rules place
the primary burden of redacting
sensitive personal information on the
parties submitting documents in
administrative proceedings—either
outside parties or Commission staff—
following common practice in federal
courts. The Commission believes that
parties filing documents are well
positioned to redact the documents—or
initially draft documents to avoid the
use of sensitive personal information—
and that the proposed narrow definition
of sensitive personal information will
limit the burden on parties required to
redact documents. The Commission
recognizes, however, that the costs of
reviewing and editing the content to
protect sensitive information might be
significant for some parties.
Additionally, when sensitive personal
information is necessary to the
proceedings, outside parties or the
Commission may expend additional
resources filing a motion for a protective
order in accordance with Rule 322 to
limit disclosure of the sensitive
information and to prepare a redacted
and unredacted version of the
documents.
Parties to administrative proceedings
will also bear any incremental burden of
electronic filings over the current
practice of facsimile or paper
transmissions. The magnitude of costs
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will depend primarily on whether the
original format of the documents to be
submitted is electronic or whether they
must be scanned or otherwise converted
to an electronic format. Other factors
that may affect these costs include the
ease of access the party has to the
internet and to any hardware and
software that may be involved in
processing the documents. For most
parties, we do not expect these costs to
be significant because, among other
things, most parties already are subject
to similar requirements in other kinds of
legal proceedings or have access to the
Internet and conversion programs at a
reasonable cost. Further, these potential
burdens may be mitigated for some
parties as the proposed rules provide for
relief from the electronic filing
requirements in situations in which a
party certifies a reasonable inability to
comply with the electronic filing
requirements.
As an alternative to the proposed
rules, the Commission could implement
electronic filing with different
requirements. In particular, the
Commission could continue to allow the
filing of unredacted documents—
requiring that redaction be undertaken
by Commission staff when necessary—
or could permit electronic filing on a
voluntary, rather than mandatory, basis.
Relative to these alternatives, or to the
existing paper format and facsimile
document submission and management
system for administrative proceedings,
the Commission believes that the
proposed changes achieve the benefits
described above in a cost-efficient
manner. The Commission does not
expect significant effects on efficiency,
competition, or capital formation to
result from the proposed changes. And
to the extent that the changes impose
any burden on competition, the
Commission believes that such burden
would be necessary and appropriate in
furtherance of the purposes of the
Exchange Act.29
The Commission requests comment
on all aspects of the economic effects of
the proposal, including any anticipated
impacts that are not mentioned here. We
are particularly interested in
quantitative estimates of the benefits
and costs, in general or for particular
types of participants in administrative
proceedings, including smaller entities.
We also request comment on reasonable
alternatives to the proposed rules and
on any effect the proposed rules may
have on efficiency, competition, and
capital formation.
29 See
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VI. Statutory Basis and Text of
Proposed Amendments
These amendments to the Rules of
Practice are being proposed pursuant to
statutory authority granted to the
Commission, including section 3 of the
Sarbanes-Oxley Act of 2002, 15 U.S.C.
7202; section 19 of the Securities Act,
15 U.S.C. 77s; sections 4A, 19, and 23
of the Exchange Act, 15 U.S.C. 78d–1,
78s, and 78w; section 319 of the Trust
Indenture Act of 1939, 15 U.S.C. 77sss;
sections 38 and 40 of the Investment
Company Act, 15 U.S.C. 80a–37 and
80a–39; and section 211 of the
Investment Advisers Act, 15 U.S.C. 80b–
11.
List of Subjects in 17 CFR Part 201
Administrative practice and
procedure.
Text of the Amendments
For the reasons set out in the
preamble, 17 CFR part 201 is proposed
to be amended as follows:
PART 201—RULES OF PRACTICE
4. The authority citation for Part 201,
subpart D, is revised to read as follows:
■
Authority: 15 U.S.C. 77f, 77g, 77h, 77h–
1, 77j, 77s, 77u, 78c(b), 78d–1, 78d–2, 78l,
78m, 78n, 78o(d), 78o–3, 78s, 78u–2, 78u–3,
78v, 78w, 77sss, 77ttt, 80a–8, 80a–9, 80a–37,
80a–38, 80a–39, 80a–40, 80a–41, 80a–44,
80b–3, 80b–9, 80b–11, 80b–12, 7202, 7215,
and 7217.
5. Section 201.102 is amended by
revising paragraphs (d)(1), (d)(2), and
(d)(4) to read as follows:
■
§ 201.102 Appearance and practice before
the Commission.
*
*
*
*
*
(d) Designation of address for service;
notice of appearance; power of attorney;
withdrawal—(1) Representing oneself.
When an individual first makes any
filing or otherwise appears on his or her
own behalf before the Commission or a
hearing officer in a proceeding as
defined in § 201.101(a), he or she shall
file with the Commission, or otherwise
state on the record, and keep current, a
mailing address and email address at
which any notice or other written
communication required to be served
upon him or her or furnished to him or
her may be sent and a telephone number
where he or she may be reached during
business hours.
(2) Representing others. When a
person first makes any filing or
otherwise appears in a representative
capacity before the Commission or a
hearing officer in a proceeding as
defined in § 201.101(a), that person
shall file with the Commission, and
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keep current, a written notice stating the
name of the proceeding; the
representative’s name, business address,
email address, and telephone number;
and the name, email address, and
address of the person or persons
represented.
*
*
*
*
*
(4) Withdrawal. Any person seeking to
withdraw his or her appearance in a
representative capacity shall file a
notice of withdrawal with the
Commission or the hearing officer. The
notice shall state the name, mailing
address, email address, and telephone
number of the withdrawing
representative; the name, address, and
telephone number of the person for
whom the appearance was made; and
the effective date of the withdrawal. If
the person seeking to withdraw knows
the name, mailing address, email
address, and telephone number of the
new representative, or knows that the
person for whom the appearance was
made intends to represent him- or
herself, that information shall be
included in the notice. The notice must
be served on the parties in accordance
with § 201.150. The notice shall be filed
at least five days before the proposed
effective date of the withdrawal.
*
*
*
*
*
■ 6. Section 201.140 is amended by
revising paragraph (a) to read as follows:
§ 201.140 Commission orders and
decisions: Signature and availability.
*
*
*
*
(a) Signature required. All orders and
decisions of the Commission shall be
signed by the Secretary or any other
person duly authorized by the
Commission. The signature may be an
electronic signature that consists of an
‘‘/s/’’ notation or any other digital
signature.
*
*
*
*
*
■ 7. Section 201.141 is amended by:
■ a. Removing the words ‘‘Express
Mail’’ each time they appear and adding
in their place the words ‘‘express mail’’;
and
■ b. Revising the first sentence of
paragraph (b).
The revision reads as follows:
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*
§ 201.141 Orders and decisions: Service of
orders instituting proceedings and other
orders and decisions.
*
*
*
*
*
(b) Service of Orders or Decisions
Other than an Order Instituting
Proceedings. Written orders or decisions
issued by the Commission or by a
hearing officer shall be served promptly
on each party pursuant to any method
of service authorized under paragraph
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(a) of this section or § 201.150(c) and
(d). * * *
■ 8. Section 201.150 is amended by:
■ a. Redesignating paragraphs (c) and
(d) as paragraphs (d) and (e);
■ b. Adding new paragraph (c);
■ c. Revising newly redesignated
paragraphs (d) introductory text and
(d)(4);
■ d. Revising newly redesignated
paragraph (e); and
■ e. Removing the words ‘‘Express
Mail’’ each time they appear and adding
in their place the words ‘‘express mail’’.
The revisions and addition read as
follows:
§ 201.150
Service of papers by parties.
*
*
*
*
*
(c) How made. Service shall be made
electronically in the form and manner
that is prescribed in the guidance posted
on the Commission’s Web site. Persons
serving each other shall have provided
the Commission and the parties with
notice of an email address.
(1) Certification of inability to serve
electronically. If a person reasonably
cannot serve electronically, due to a
lack of access to electronic transmission
devices (due to incarceration or
otherwise), the person promptly shall
file a certification under this paragraph
that explains why the person reasonably
cannot comply. The filing also must
indicate the expected duration of the
person’s reasonable inability to comply,
such as whether the certification is
intended to apply to a solitary instance
of service or all instances of service
made during the proceeding. The
certification is immediately effective.
Upon filing the certification, it will be
part of the record of the proceeding, and
the person may serve paper documents
by any additional method listed in Rule
150(d).
(d) Additional methods of service. If a
person reasonably cannot serve
electronically, or if service is of an
investigative subpoena pursuant to 17
CFR 203.8, service may be made by
delivering a copy of the filing. Delivery
means:
*
*
*
*
*
(4) Transmitting the papers by
facsimile transmission to the person
required to be served. The persons so
serving each other shall have provided
the Commission and the parties with
notice of a facsimile machine telephone
number.
(e) When service is complete.
Electronic service is complete upon
transmission. Personal service, service
by U.S. Postal Service express mail or
service by a commercial courier or
express delivery service is complete
upon delivery. Service by mail is
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complete upon mailing. Service by
facsimile is complete upon confirmation
of transmission.
■ 9. Section 201.151 is amended by
revising paragraphs (a) and (d) and
adding paragraph (e) to read as follows:
§ 201.151 Filing of papers with the
Commission: Procedure.
(a) When to file. All papers required
to be served upon any person shall also
be filed contemporaneously with the
Commission electronically pursuant to
the requirements of § 201.152(a). The
person making such filing is responsible
for ensuring that the Commission
receives a complete and legible filing
within the time limit set for such filing.
Documents that are attached to filings
shall be filed in accordance with this
Rule. Documents or items that are not
attached to filings (i.e., are admitted by
the hearing officer at an in-person
hearing), shall be submitted in
accordance with § 201.351.
*
*
*
*
*
(d) Certificate of service. Papers filed
with the Commission or a hearing
officer shall be accompanied by a
certificate stating the name of the person
or persons served, the date of service,
the method of service, and the mailing
address or email address to which
service was made, if not made in
person.
(e) Sensitive personal information.
Sensitive personal information is
defined as a Social Security number,
taxpayer identification number,
financial account number, credit card or
debit card number, passport number,
driver’s license number, state-issued
identification number, home address
(other than city and state), telephone
number, date of birth (other than year),
names and initials of minor children, as
well as any sensitive health information
identifiable by individual, such as an
individual’s medical records. Sensitive
personal information shall not be
included in, and must be redacted or
omitted from, all filings subject to:
(1) Exceptions. The following
information may be included and is not
required to be redacted from filings:
(i) The last four digits of a taxpayer
identification number, financial account
number, credit card or debit card
number, passport number, driver’s
license number, and state-issued
identification number;
(ii) Home addresses and telephone
numbers of parties and persons filing
documents with the Commission;
(iii) Business telephone numbers; and
(iv) Copies of unredacted filings by
regulated entities or registrants that are
available on the Commission’s public
Web site.
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(2) Confidential treatment of
information. If the person making any
filing believes that sensitive personal
information (as defined above)
contained therein is necessary to the
proceeding, the person shall file
unredacted documents, along with a
motion for a protective order in
accordance with § 201.322 to limit
disclosure of unredacted sensitive
personal information.
(3) Certification. Any filing must
include a certification that any sensitive
personal information as defined in
§ 201.151(e) has been excluded or
redacted from the filing or, if necessary
to the filing, has been filed under seal
pursuant to § 201.322.
■ 10. Section 201.152 is amended by:
■ a. Removing paragraph (d);
■ b. Redesignating paragraphs (b) and
(c) as paragraphs (c) and (d);
■ c. Redesignating paragraph (a) as
paragraph (b) and revising it;
■ d. Adding new paragraph (a);
■ e. Removing newly redesignated
paragraph (b)(6);
■ f. Revising newly designated
paragraph (c); and
■ g. Removing the phrase ‘‘or
microfilming’’ from newly redesignated
paragraph (d).
The revisions and addition read as
follows:
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§ 201.152
Filing of papers: Form.
(a) Electronic filing. Papers filed in
connection with any proceeding as
defined in § 201.101(a) shall be filed
electronically in the form and manner
that is prescribed in the guidance posted
on the Commission’s Web site. Papers
filed electronically must be received by
the Commission by midnight Eastern
Time on the date the filing is due.
(1) Certification of Inability to File
Electronically. If a person reasonably
cannot comply with the requirements of
this section, due to a lack of access to
electronic transmission devices (due to
incarceration or otherwise), the person
promptly shall file a certification under
this paragraph that explains why the
person reasonably cannot comply. The
filing also must indicate the expected
duration of the person’s reasonable
inability to comply, such as whether the
certification is intended to apply to a
solitary filing or all filings made during
the proceeding. The certification is
immediately effective. Upon filing the
certification, it will be part of the record
of the proceeding, and the person may
file paper documents by any additional
method listed in § 201.152(a)(2).
(2) Additional methods of filing. If a
person reasonably cannot file
electronically, filing may be made by
hand delivering the filing by 5:30 p.m.
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Eastern Time through a commercial
courier service or express delivery
service; mailing the filing through the
U.S. Postal Service by first class,
certified, registered, or express mail
delivery so that it is received by the
Commission by 5:30 p.m. Eastern Time;
or transmitting the filing by facsimile
transmission so that it is received by the
Commission by midnight Eastern Time.
(b) Form. Papers filed in connection
with any proceeding as defined in
§ 201.101(a) shall:
(1) Reflect a page, electronically or
otherwise, that measures 81⁄2 × 11
inches when printed, except that, to the
extent that the reduction of larger
documents would render them illegible
when printed, such documents may be
filed on larger paper;
(2) Use 12-point or larger typeface;
(3) Include at the head of the paper,
or on a title page, the name of the
Commission, the title of the proceeding,
the names of the parties, the subject of
the particular paper or pleading, and the
file number assigned to the proceeding;
(4) Be paginated with left hand
margins at least 1 inch wide, and other
margins of at least 1 inch; and
(5) Be double-spaced, with singlespaced footnotes and single-spaced
indented quotations.
(c) Signature required. All papers
must be dated and signed as provided
in § 201.153. Electronic filings that
require a signature pursuant to
§ 201.153 may be signed with an ‘‘/s/’’
notation, which shall be deemed the
signature of the person making the filing
for purposes of § 201.153.
(d) Suitability for recordkeeping.
Documents which, in the opinion of the
Commission, are not suitable for
computer scanning may be rejected.
*
*
*
*
*
■ 11. Section 201.193 is amended by
revising paragraph (b) introductory text
to read as follows:
§ 201.193 Applications by barred
individuals for consent to associate.
*
*
*
*
*
(b) Form of application. Each
application shall be supported by an
affidavit, signed by the applicant, that
addresses the factors set forth in
paragraph (d) of this section. The
application shall be filed pursuant to
§§ 201.151, 201.152 and 201.153. Each
application shall include as exhibits:
*
*
*
*
*
■ 12. Section 201.322 is amended by
revising paragraph (a), redesignating
paragraphs (b), (c), and (d) as paragraphs
(c), (d), and (e), and adding new
paragraph (b).
The revision and addition read as
follows:
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§ 201.322 Evidence: Confidential
information, protective orders.
(a) Procedure. In any proceeding as
defined in § 201.101(a), a party, any
person who is the owner, subject or
creator of a document subject to
subpoena or which may be introduced
as evidence, or any witness who testifies
at a hearing may file a motion
requesting a protective order to limit
from disclosure to other parties or to the
public documents or testimony that
contain confidential information. The
motion should include a general
summary or extract of the documents
without revealing confidential details.
(b) If review of the documents that are
the subject of a request for a protective
order is necessary to a ruling on the
motion and the information as to which
a protective order is sought is available
to the movant, the motion shall be
accompanied by:
(1) A complete, sealed copy of the
materials containing the information as
to which a protective order is sought,
with the allegedly confidential
information marked as such, and with
the first page of the document labeled
‘‘Under Seal.’’ If the movant seeks a
protective order against disclosure to
other parties as well as the public,
copies of the documents shall not be
served on other parties; and
(2) A redacted copy of the materials
containing the information as to which
a protective order is sought, with the
allegedly confidential information
redacted. The redacted version shall
indicate any omissions with brackets or
ellipses, and its pagination and
depiction of text on each page shall be
identical to that of the sealed version. A
redacted copy need not accompany a
motion requesting a protective order if
the materials would be redacted in their
entirety.
*
*
*
*
*
■ 13. Section 201.351 is amended by
revising paragraph (b), redesignating
paragraph (c) as paragraph (d), and
adding new paragraph (c).
The revision and addition read as
follows:
§ 201.351 Transmittal of documents to
Secretary; record index; electronic copy of
exhibits; certification.
*
*
*
*
*
(b) Preparation, certification of record
index. Promptly after the close of the
hearing, the hearing officer shall
transmit to the Secretary an index of the
originals of any motions, exhibits or any
other documents filed with or accepted
into evidence by the hearing officer that
have not been previously transmitted to
the Secretary, and the Secretary shall
prepare a record index. Prior to issuance
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of an initial decision, or if no initial
decision is to be prepared, within 30
days of the close of the hearing, the
Secretary shall transmit the record
index to the hearing officer and serve a
copy of the record index on each party.
Any person may file proposed
corrections to the record index with the
hearing officer within three days of
service of the record index. Any
opposition to the proposed corrections
shall be filed within three days of
service of the proposed corrections. The
hearing officer shall, by order, direct
whether any corrections to the record
index shall be made. The Secretary shall
make such corrections, if any, and issue
a revised record index. If an initial
decision is to be issued, the initial
decision shall include a certification
that the record consists of the items set
forth in the record index or revised
record index issued by the Secretary.
(c) Electronic exhibits. Within two
weeks after the close of a hearing, the
parties shall submit electronically to the
Secretary a copy of all exhibits that were
admitted, or offered and not admitted,
during the hearing, and any other
exhibits that were admitted after the
hearing. The parties shall submit such
evidence in the form and manner that is
prescribed in the guidance posted on
the Commission’s Web site.
(1) Sensitive personal information.
Sensitive personal information is
defined as a Social Security number,
taxpayer identification number,
financial account number, credit card or
debit card number, passport number,
driver’s license number, state-issued
identification number, home address
(other than city and state), telephone
number, date of birth (other than year),
names and initials of minor children, as
well as any sensitive health information
identifiable by individual, such as an
individual’s medical records. Sensitive
personal information shall not be
included in, and must be redacted or
omitted from, all filings subject to:
(i) Exceptions. The following
information may be included and is not
required to be redacted from filings:
(A) The last four digits of a taxpayer
identification number, financial account
number, credit card or debit card
number, passport number, driver’s
license number, and state-issued
identification number;
(B) Home addresses and telephone
numbers of parties and persons filing
documents with the Commission;
(C) Business telephone numbers; and
(D) Copies of unredacted filings by
regulated entities or registrants that are
available on the Commission’s public
Web site.
VerDate Sep<11>2014
17:24 Oct 02, 2015
Jkt 238001
(ii) Confidential treatment of
information. If the person submitting
record exhibits and other documents or
items that are not attached to filings
believes that sensitive personal
information (as defined in
§ 201.351(c)(1)) contained therein is
necessary to the proceeding, the person
shall file unredacted documents, along
with a motion for a protective order in
accordance with § 201.322 to limit
disclosure of unredacted sensitive
personal information.
(2) Certification of inability to submit
exhibits electronically. A person who
reasonably cannot submit exhibits
electronically must file a certification
under § 201.351(c)(2) that explains why
the person reasonably cannot comply.
The filing also must indicate the
expected duration of the person’s
reasonable inability to comply, such as
whether the certification is intended to
apply to a solitary submission or all
submissions made during the
proceeding. The certification is
immediately effective. Upon filing the
certification, it will be part of the record
of the proceeding, and the person shall
submit originals of any exhibits that
have not already been submitted to the
Secretary by other means.
(3) Signature requirement. Electronic
submissions that require a signature
pursuant to § 201.153 may be signed
with an ‘‘/s/’’ notation, which shall be
deemed the signature of the person
making the submission for purposes of
§ 201.153.
(4) Certification. The parties shall
certify that exhibits and other
documents or items submitted to the
Secretary under this rule:
(i) Are true and accurate copies of
exhibits that were admitted, or offered
and not admitted, during the hearing;
and
(ii) That any sensitive personal
information as defined in § 201.351(c)
has been excluded or redacted, or, if
necessary, has been filed under seal
pursuant to § 201.322.
*
*
*
*
*
■ 14. Section 201.420 is amended by
revising paragraph (e) to read as follows:
§ 201.420 Appeal of determinations by
self-regulatory organizations.
*
*
*
*
*
(e) Certification of the record; service
of the index. Fourteen days after receipt
of an application for review or a
Commission order for review, the selfregulatory organization shall certify and
file electronically in the form and
manner that is prescribed in the
guidance posted on the Commission’s
Web site one unredacted copy of the
record upon which the action
PO 00000
Frm 00016
Fmt 4702
Sfmt 4702
complained of was taken. If such record
contains any sensitive personal
information, as defined in paragraph
(e)(1) of this section, the self-regulatory
organization also shall file electronically
with the Commission one redacted copy
of such record, subject to the following:
(1) Sensitive personal information.
Sensitive personal information is
defined as a Social Security number,
taxpayer identification number,
financial account number, credit card or
debit card number, passport number,
driver’s license number, state-issued
identification number, home address
(other than city and state), telephone
number, date of birth (other than year),
names and initials of minor children, as
well as any sensitive health information
identifiable by individual, such as an
individual’s medical records. Sensitive
personal information shall not be
included in, and must be redacted or
omitted from, all filings subject to:
(i) Exceptions. The following
information may be included and is not
required to be redacted from filings:
(A) The last four digits of a taxpayer
identification number, financial account
number, credit card or debit card
number, passport number, driver’s
license number, and state-issued
identification number;
(B) Home addresses and telephone
numbers of parties and persons filing
documents with the Commission;
(C) Business telephone numbers; and
(D) Copies of unredacted filings by
regulated entities or registrants that are
available on the Commission’s public
Web site.
(ii) [Reserved]
(2) Index. The self-regulatory
organization also shall file electronically
with the Commission one copy of an
index to such record, and shall serve
upon each party one copy of the index.
If such index contains any sensitive
personal information, as defined in
paragraph (e)(1) of this section, the selfregulatory organization also shall file
electronically with the Commission one
redacted copy of such index, subject to
the requirements of paragraphs (e)(1)
introductory text and (e)(1)(i).
(3) Certification. Any filing made
pursuant to this section must include a
certification that any sensitive personal
information as defined in § 201.420(e)(1)
has been excluded or redacted from the
filing.
■ 15. Section 201.440 is amended by
revising paragraph (d) to read as
follows:
§ 201.440 Appeal of determinations by the
Public Company Accounting Oversight
Board.
*
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(d) Certification of the record; service
of the index. Within fourteen days after
receipt of an application for review, the
Board shall certify and file
electronically in the form and manner
that is prescribed in the guidance posted
on the Commission’s Web site one
unredacted copy of the record upon
which it took the complained-of action.
If such record contains any sensitive
personal information, as defined in
paragraph (d)(1) of this section, the
Board also shall file electronically with
the Commission one redacted copy of
such record, subject to the following:
(1) Sensitive personal information.
Sensitive personal information is
defined as a Social Security number,
taxpayer identification number,
financial account number, credit card or
debit card number, passport number,
driver’s license number, state-issued
identification number, home address
(other than city and state), telephone
number, date of birth (other than year),
names and initials of minor children, as
well as any sensitive health information
identifiable by individual, such as an
individual’s medical records. Sensitive
personal information shall not be
included in, and must be redacted or
omitted from, all filings subject to:
(i) Exceptions. The following
information may be included and is not
required to be redacted from filings:
(A) The last four digits of a taxpayer
identification number, financial account
number, credit card or debit card
number, passport number, driver’s
license number, and state-issued
identification number;
(B) Home addresses and telephone
numbers of parties and persons filing
documents with the Commission;
(C) Business telephone numbers; and
(D) Copies of unredacted filings by
regulated entities or registrants that are
available on the Commission’s public
Web site.
(ii) [Reserved]
(2) Index. The Board shall file
electronically with the Commission one
copy of an index of such record, and
shall serve one copy of the index on
each party. If such index contains any
sensitive personal information, as
defined in paragraph (d)(1) of this
section, the Board also shall file
electronically with the Commission one
redacted copy of such index, subject to
the requirements of paragraphs (d)(1)
introductory text and (d)(1)(i).
(3) Certification. Any filing made
pursuant to this section must include a
certification that any sensitive personal
information as defined in
§ 201.440(d)(1) has been excluded or
redacted from the filing.
By the Commission.
VerDate Sep<11>2014
17:24 Oct 02, 2015
Jkt 238001
Dated: September 24, 2015.
Brent J. Fields,
Secretary.
[FR Doc. 2015–24705 Filed 10–2–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
17 CFR Part 201
[Release No. 34–75976; File No. S7–18–15]
RIN 3235–AL87
Amendments to the Commission’s
Rules of Practice
Securities and Exchange
Commission.
ACTION: Proposed rule.
AGENCY:
The Securities and Exchange
Commission (‘‘Commission’’) is
proposing for public comment
amendments to update its Rules of
Practice to, among other things, adjust
the timing of hearings in administrative
proceedings; allow for discovery
depositions; clarify the rules for
admitting hearsay and assertion of
affirmative defenses; and make certain
related amendments.
DATES: Comments should be received on
or before December 4, 2015.
ADDRESSES: Comments may be
submitted by any of the following
methods:
SUMMARY:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/proposed.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number S7–
18–15 on the subject line; or
• Use the Federal eRulemaking Portal
(https://www.regulations.gov). Follow the
instructions for submitting comments.
Paper Comments
• Send paper comments to Secretary,
Securities and Exchange Commission,
100 F Street NE., Washington, DC
20549–1090.
All submissions should refer to File
Number S7–18–15. This file number
should be included on the subject line
if email is used. To help us process and
review your comments more efficiently,
please use only one method of
submission. The Commission will post
all comments on the Commission’s
Internet Web site (https://www.sec/gov/
rules/proposed.shtml). Comments are
also available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official
PO 00000
Frm 00017
Fmt 4702
Sfmt 4702
60091
business days between the hours of
10:00 a.m. and 3:00 p.m. All comments
received will be posted without change;
we do not edit personal identifying
information in submissions. You should
submit only information that you wish
to make available publicly.
FOR FURTHER INFORMATION CONTACT:
Adela Choi, Senior Counsel, and Laura
Jarsulic, Associate General Counsel,
Office of the General Counsel, (202)
551–5150, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549.
SUPPLEMENTARY INFORMATION: The
Commission proposes to amend its
Rules of Practice. The amendments are
being proposed to update its existing
rules.
I. Introduction
As it has done from time to time, the
Commission proposes to amend its
Rules of Practice.1 The Commission
proposes amendments to update the
Rules of Practice to adjust the timing of
hearings and other deadlines in
administrative proceedings and to
provide parties in administrative
proceedings with the ability to use
depositions and other discovery tools.
The Commission proposes additional
amendments to implement the newly
available discovery tools. These
proposed Rules are intended to
introduce additional flexibility into
administrative proceedings, while still
providing for the timely and efficient
disposition of proceedings. The
Commission also proposes amendments
to clarify certain other Rules, including
the assertion of affirmative defenses in
answers and the admissibility of
hearsay.
II. Discussion of Proposed Amendments
The proposed amendments are as
follows:
A. Proposed Amendments to Rule 360
Rule 360 2 sets forth timing for certain
stages of an administrative proceeding.
These stages include a prehearing
period, a hearing, a period during which
parties review hearing transcripts and
1 See, e.g., Rules of Practice, Exchange Act
Release No. 35833, 60 FR 32738 (June 9, 1995);
Rules of Practice, Exchange Act Release No. 40636,
63 FR 63404 (Nov. 4, 1998); Rules of Practice,
Exchange Act Release No. 48018, 68 FR 35787 (June
11, 2003); Adoption of Amendments to the Rules of
Practice and Delegations of Authority of the
Commission, Exchange Act Release No. 49412, 69
FR 13166 (Mar. 12, 2004); Adoption of
Amendments to the Rules of Practice and Related
Provisions and Delegations of Authority of the
Commission, Exchange Act Release No. 52846, 70
FR 72566 (Dec. 5, 2005); Rules of Practice,
Exchange Act Release No. 63723, 76 FR 4066 (Jan.
24, 2011).
2 17 CFR 201.360.
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]]>Agencies
[Federal Register Volume 80, Number 192 (Monday, October 5, 2015)]
[Proposed Rules]
[Pages 60082-60091]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-24705]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
17 CFR Part 201
[Release No. 34-75977; File No. S7-19-15]
RIN 3235-AL87
Amendments to the Commission's Rules of Practice
AGENCY: Securities and Exchange Commission.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: The Securities and Exchange Commission (``Commission'') is
proposing for public comment amendments to its Rules of Practice that
would require persons involved in
[[Page 60083]]
administrative proceedings to submit all documents and other items
electronically. The proposed amendments are intended to enhance the
accessibility of administrative proceedings by ensuring that filings
and other information concerning administrative proceedings are more
readily available to the public.
DATES: Comments should be received on or before December 4, 2015.
ADDRESSES: Comments may be submitted by any of the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/proposed.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number S7-19-15 on the subject line; or
Use the Federal eRulemaking Portal (https://www.regulations.gov). Follow the instructions for submitting comments.
Paper Comments
Send paper comments to Secretary, Securities and Exchange
Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number S7-19-15. This file number
should be included on the subject line if email is used. To help us
process and review your comments more efficiently, please use only one
method of submission. The Commission will post all comments on the
Commission's Internet Web site (https://www.sec/gov/rules/proposed.shtml). Comments are also available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. All comments received will be posted without change; we
do not edit personal identifying information in submissions. You should
submit only information that you wish to make available publicly.
FOR FURTHER INFORMATION CONTACT: Adela Choi, Senior Counsel, and Laura
Jarsulic, Associate General Counsel, Office of the General Counsel,
(202) 551-5150, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549.
SUPPLEMENTARY INFORMATION: The Commission proposes to amend its Rules
of Practice. The amendments are being proposed as a result of the
Commission's experience with its existing rules.
I. Introduction
The Commission proposes to make targeted amendments to its Rules of
Practice that would automate and modernize aspects of the filing
process in administrative proceedings to facilitate the flow of
information to the public. The Commission recognizes the need to ensure
that public administrative proceeding records are made available to the
public as quickly as possible. Roughly 100 requests for records related
to administrative proceedings were made each year over the last three
years, and certain records were requested by multiple members of the
public.
The Commission currently is developing a comprehensive Internet-
based electronic system that would, among other things, allow persons
in administrative proceedings to file and serve documents
electronically and facilitate the prompt distribution of public
information regarding administrative proceedings. In conjunction with
the development of this system, the Commission proposes to require
electronic submissions. The Commission believes that electronic
submissions will enhance the transparency of administrative proceedings
by providing a quicker way for the Commission to make records available
to the public. In addition, the Commission believes that the electronic
system will increase its ability to efficiently process filings, and
may decrease costs for parties who may file and serve submissions
electronically, rather than in paper format.\1\
---------------------------------------------------------------------------
\1\ As part of the ongoing effort to make records available to
the public promptly, the Commission now posts on its Web site more
types of documents associated with administrative proceedings, such
as significant pleadings filed by parties. Previously, only
documents issued by the Commission and Administrative Law Judges,
such as adjudicatory initial decisions, opinions, and orders, were
posted on the Web site.
---------------------------------------------------------------------------
There are three main components to the proposed approach. First,
persons involved in administrative proceedings who currently are
required to file documents under Rules 151 and 152 of the Commission's
Rules of Practice would be required to file such documents
electronically through a secure system on the Commission's Web site at
www.sec.gov that is designed to receive uploads of documents and
attachments. Filing by facsimile and in paper format would no longer be
permitted absent the filing of a certification that the person
reasonably cannot comply with the electronic filing requirement.
However, as discussed further below, for the first 90 days after the
proposed amendments become final, the Commission intends to administer
a phase-in period that would require all filings to be made both
electronically and in paper format. Second, parties that are required
to serve documents under Rule 150 would be required to serve each other
electronically in the form and manner that is prescribed in the
guidance posted on the Commission's Web site.
The third component would require filers to exclude or redact
sensitive personal information from electronic filings and submissions
in accordance with the Commission's obligation to protect such
information under the Privacy Act of 1974, as amended.\2\ Sensitive
personal information would be defined as a Social Security number,
taxpayer identification number, financial account number, credit card
or debit card number, passport number, driver's license number, state-
issued identification number, home address (other than city and state),
telephone number, date of birth (other than year), names and initials
of minor children, as well as any sensitive health information
identifiable by individual, such as an individual's medical records.
There are exceptions to this proposed definition. Specifically, persons
need not redact the last four digits of a taxpayer identification
number, financial account number, credit card or debit card number,
passport number, driver's license number, and state-issued
identification number. Nor would persons need to redact home addresses
and telephone numbers of parties and persons filing documents with the
Commission; business telephone numbers; and copies of unredacted
filings by regulated entities or registrants that are available on the
Commission's public Web site. The definition of sensitive personal
information would not include a personal email address. We seek
comments about whether the disclosure of personal email addresses
generally and home addresses of parties and persons filing documents
with the Commission could have an adverse
[[Page 60084]]
effect on persons or parties, and whether, as a result, these terms
should be included in the definition of sensitive personal information
that must be excluded or redacted.
---------------------------------------------------------------------------
\2\ 5 U.S.C. 552a. Federal courts and certain federal agencies
require the exclusion or redaction of certain sensitive personal
information contained in filings. See, e.g., Fed. R. Civ. P. 5.2
(Privacy Protection for Filings Made with the Court); Consumer
Financial Protection Bureau, Rules of Practice for Adjudication
Proceedings, Rule 112, 12 CFR 1081.112 (Formal Requirements as to
Papers Filed); National Labor Relations Board, E-Filing Terms for
Selected Documents in Unfair Labor Practice and Representation
Cases, available at https://www.nlrb.gov/sites/default/files/attachments/basic-page/node-1673/electronic_filings.pdf (last
visited Sept. 10, 2015). The electronic filings and submissions
discussed herein are systems of records that the Commission has
previously identified as covered by the Privacy Act.
---------------------------------------------------------------------------
If the person making a filing believes that sensitive personal
information is necessary to the proceeding, the person would need to
file a motion for a protective order in accordance with Rule 322 to
limit disclosure of the sensitive personal information. In accordance
with the proposed amendments to Rule 322, and only if review of the
documents is necessary to a ruling on the motion, the person would be
required to file an unredacted version of the submission to be used by
the hearing officer and the Commission for purposes of the proceeding,
and a redacted version to be used for distribution to the public. A
redacted version would not need to be filed if the submission would be
redacted in its entirety. This reflects current practice when parties
file motions for protective orders pursuant to the Rules of Practice.
As a corollary to incorporating electronic filings into the Rules
of Practice, self-regulatory organizations and the Public Company
Accounting Oversight Board (``PCAOB'') would be required to file
electronically with the Commission a copy of a record that is the
subject of an appeal.
II. Discussion of Proposed Amendments
The proposed amendments are as follows:
A. Proposed Amendments to Rule 140
Rule 140 \3\ requires the Secretary or other authorized person to
sign Commission orders and decisions. The proposed amendment would
clarify that the signature may be an electronic signature. An
electronic signature could consist of an ``/s/'' notation or any other
digital signature.
---------------------------------------------------------------------------
\3\ 17 CFR 201.140.
---------------------------------------------------------------------------
B. Proposed Amendments to Rule 151
Rule 151(a) \4\ currently sets forth the procedural requirements
for filing papers with the Commission. The proposed amendment would
require a person to make filings electronically pursuant to the
requirements of Rule 152(a).\5\ Filing by facsimile and in paper format
would no longer be permitted absent a certification filed under Rule
152(a)(1) that explains why the person reasonably cannot comply with
the electronic filing requirement. During a 90-day phase-in period
after adoption, filings would have to be made in both paper and
electronic format.
---------------------------------------------------------------------------
\4\ 17 CFR 201.151(a).
\5\ 17 CFR 201.152(a).
---------------------------------------------------------------------------
Rule 151(d) \6\ would be amended to include an email address in the
certificate of service for those parties served by email.
---------------------------------------------------------------------------
\6\ 17 CFR 201.151(d).
---------------------------------------------------------------------------
Proposed new Rule 151(e) \7\ would require persons to exclude or
redact sensitive personal information, which would be defined as a
Social Security number, taxpayer identification number, financial
account number, credit card or debit card number, passport number,
driver's license number, state-issued identification number, home
address (other than city and state), telephone number, date of birth
(other than year), names and initials of minor children, as well as any
sensitive health information identifiable by individual, such as an
individual's medical records. There would be three exceptions to the
definition. First, persons may, but would not be required to, exclude
or redact the last four digits of a taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, and state-issued identification
number. Second, persons would not be required to redact home addresses
and telephone numbers of parties and persons filing documents with the
Commission. Third, persons would not be required to redact any
information from copies of filings by regulated entities or registrants
that are available on the Commission's public Web site. All filings
must include a certification that any sensitive personal information
has been excluded or redacted from the filing or, if necessary to the
filing, has been filed under seal pursuant to Rule 322.
---------------------------------------------------------------------------
\7\ 17 CFR 201.151(e).
---------------------------------------------------------------------------
If the person making a filing believes that sensitive personal
information is necessary to the proceeding, the person would need to
file a motion for a protective order in accordance with Rule 322 \8\ to
limit disclosure of the sensitive personal information. If review of
the documents that are the subject of a motion for a protective order
is necessary to a ruling on the motion, the proposed amendment to Rule
322 would require a person to file an unredacted version of the
submission to be used by the hearing officer and the Commission for
purposes of the proceeding, and a redacted version to be used for
distribution to the public. The unredacted version would be required to
have the confidential information marked and include the words ``Under
Seal'' on the first page of the document. The redacted version would be
required to be identical in all other respects to the unredacted
version. A person would not be required to file a redacted version if
the submission would be redacted in its entirety. This process would be
required for all kinds of motions for protective orders made pursuant
to Rule 322, i.e., not just those motions filed regarding sensitive
personal information.
---------------------------------------------------------------------------
\8\ 17 CFR 201.322.
---------------------------------------------------------------------------
C. Proposed Amendments to Rule 152
Like Rule 151, the proposed amendments to Rule 152(a) would make
clear that all filings shall be made electronically. Rule 152(a) would
direct persons to follow guidance issued by the Secretary on the
Commission's Web site at www.sec.gov. For example, the guidance would
provide instructions on how to file electronically through a secure
system on the Commission's Web site or other means; information about
the Commission's Privacy Act obligations, including information about a
filer's responsibilities to redact sensitive personal information; and
the terms and conditions of using the Web site. Generally speaking,
persons would use the secure system on the Commission's Web site
pursuant to Rule 152 to file documents, such as briefs and motions and
their attachments, petitions for review, and applications for review.
Under Rule 152(a), papers would need to be filed on the secure system
before midnight Eastern Time, as opposed to 5:30 p.m. Eastern Time, the
current deadline for filing papers.
The Commission recognizes that a person involved in an
administrative proceeding may be unable to submit documents
electronically during either the entire proceeding or a portion
thereof. For example, a person who is incarcerated at the time of the
proceeding may not have access to the Internet or other electronic
media necessary to file documents through the Commission's secure
system. There may be other reasons why a person reasonably cannot
comply with the electronic filing requirement.
A person who reasonably cannot comply with the requirement must
file a certification under Rule 152(a)(1) that explains why the person
reasonably cannot comply. The filing also must indicate the expected
duration of the person's reasonable inability to comply, such as
whether the certification is intended to apply to a solitary filing or
all filings made during the proceeding. The certification is
immediately effective. Upon filing the certification, it will be part
of the record of the proceeding, and the person may file
[[Page 60085]]
paper documents by any additional method listed in Rule 152(d).
Rule 152(a) would be amended to provide additional methods of
filing if a person reasonably cannot comply with the electronic filing
requirements. Filers should take note that the Commission would need to
receive mailed, couriered, or hand-delivered filings by 5:30 p.m.
Eastern Time because the Commission is unable to accept such filings
after that time. The Commission would need to receive facsimile
transmissions by midnight Eastern Time.
The proposed amendment also would provide that electronic filings
that require a signature pursuant to Rule 153 \9\ may be signed with an
``/s/'' notation, which shall be deemed the signature of the person
making the filing for purposes of Rule 153.
---------------------------------------------------------------------------
\9\ 17 CFR 201.153.
---------------------------------------------------------------------------
D. Proposed Amendments to Rule 351
Rule 351 \10\ currently sets forth the requirements regarding the
transmittal of documents to the Secretary and the preparation,
issuance, and certification of a record index. Rule 351(b) \11\
requires the hearing officer to transmit to the Secretary an index of
the originals of any motions, exhibits or any other documents filed
with or accepted into evidence by the hearing officer that have not
been previously transmitted to the Secretary. The Secretary then shall
prepare a record index and transmit it to the hearing officer and serve
a copy on each party. Any person may file proposed corrections to the
record index with the hearing officer within fifteen days of service of
the record index. The proposed amendment to Rule 351(b) would reduce
that amount of time to three days but would provide persons who oppose
the proposed corrections three days to file an opposition.
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\10\ 17 CFR 201.351.
\11\ 17 CFR 201.351(b).
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Proposed new Rule 351(c) \12\ would state that, no later than five
days after the Secretary serves a final record index, the parties shall
submit electronically, through the same secure system used for filings
under Rules 151 and 152, copies of all exhibits that were admitted, or
offered and not admitted, during the hearing, and any other exhibits
that were admitted after the hearing. The parties shall submit such
evidence in the form and manner that is prescribed in the guidance
posted on the Commission's Web site and shall certify that exhibits and
other documents or items submitted to the Secretary are true and
accurate copies of exhibits that were admitted, or offered and not
admitted, during the hearing. Generally speaking, parties would follow
Rule 351 to submit record exhibits and other documents or items that
are not attached to filings, i.e., materials accepted into evidence by
a hearing officer under Rule 351 in connection with an in-person
hearing. As under Rule 151(a), the submission deadline depends on the
method of delivery that is used.
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\12\ 17 CFR 201.351(c).
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As under Rule 151(e), the proposed amendment to Rule 351(c) would
set forth the same definition of sensitive personal information,
require its redaction or omission from all submissions under Rule 351,
provide a process for seeking a protective order under Rule 322 with
respect to sensitive personal information that is necessary to the
proceeding, and require a certification that sensitive personal
information has been excluded or redacted or filed under seal. A person
who reasonably cannot submit exhibits electronically must file a
certification under Rule 351(c)(2) that explains why the person
reasonably cannot comply. The filing also must indicate the expected
duration of the person's reasonable inability to comply, such as
whether the certification is intended to apply to a solitary submission
or all submissions made during the proceeding. The certification is
immediately effective. Upon filing the certification, it will be part
of the record of the proceeding, and the person shall submit originals
of any exhibits that have not already been submitted to the Secretary
by other means. Rule 351(c) also would state that electronic
submissions that require a signature pursuant to Rule 153 may be signed
with an ``/s/'' notation, which shall be deemed the signature of the
person making the filing for purposes of Rule 153.
E. Phase-In Period
For the first 90 days after the proposed amendments become final,
the Commission intends to administer a phase-in period that would
require all filings to be made both electronically and in paper format.
The Commission preliminarily believes that a 90-day phase-in period is
a reasonable amount of time for persons to become proficient in the
electronic filing procedures while ensuring that the Commission
receives the filing should there be an electronic transmission failure.
However, it may be appropriate to extend the phase-in period if persons
are experiencing substantial difficulties with the electronic filing.
F. Other Proposed Amendments
Rule 150(c) \13\ would be amended to require parties to serve each
other electronically in the form and manner that is prescribed in the
guidance posted on the Commission's Web site. Electronic service by
email is a practice that appears to occur already in administrative
proceedings. Electronic service would need to occur contemporaneously
with filing, and the timing of service would therefore differ depending
on the filing method. As with electronic filing, a party who reasonably
cannot comply with the electronic service requirement must file a
certification under Rule 150(c)(1) that explains why the person
reasonably cannot comply. The filing also must indicate the expected
duration of the person's reasonable inability to comply, such as
whether the certification is intended to apply to a solitary instance
of service or all instances of service made during the proceeding. The
certification is immediately effective. Upon filing the certification,
it will be part of the record of the proceeding, and the person may
serve paper documents by any additional method listed in Rule 150(d).
Rule 150(d) would be amended to provide additional methods of service
if a person reasonably cannot comply with the electronic service
requirements, or if service is of an investigative subpoena pursuant to
17 CFR 203.8. Under Rule 150(e),\14\ electronic service would be deemed
complete upon transmission.
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\13\ 17 CFR 201.150(c).
\14\ 17 CFR 201.150(e).
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Rule 141(b) \15\ would be amended to allow the Secretary to serve
orders and decisions, other than an order instituting proceedings,
electronically.
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\15\ 17 CFR 201.141(b).
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Currently, Rule 102(d) \16\ requires a person to provide to the
Commission certain contact information that may be used during an
administrative proceeding. The proposed amendment clarifies that a
mailing address and an email address shall be provided under paragraphs
(d)(1), (d)(2), and (d)(4).\17\
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\16\ 17 CFR 201.102(d).
\17\ 17 CFR 201.102(d)(1), (d)(2), (d)(4).
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Rule 193 \18\ currently provides that an original and three copies
of an application shall be filed under Rules 151, 152, and 153, and
that such application shall be supported by a manually signed
affidavit. The proposed amendment would delete the term ``manually,''
delete the reference to one original and three copies, and leave the
[[Page 60086]]
cross reference to Rules 151, 152, and 153 to account for electronic
filing.
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\18\ 17 CFR 201.193.
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Rule 420 \19\ sets forth the requirements regarding appeals of
determinations by self-regulatory organizations. Currently, Rule 420(e)
\20\ requires a self-regulatory organization to certify and file with
the Commission one copy of the record upon which the action complained
of was taken, to file with the Commission three copies of an index to
such record, and to serve upon each party one copy of the index within
fourteen days after receiving an application for review or a Commission
order for review. The proposed amendment would require the self-
regulatory organization to file such information electronically.
Further, if such information contains sensitive personal information,
the self-regulatory organization would be required to file
electronically a copy of the record and index that redacts or omits the
sensitive personal information and to certify that any sensitive
personal information has been excluded or redacted. The requirements
for filing and serving would continue to be governed by Rules 150-152.
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\19\ 17 CFR 201.420.
\20\ 17 CFR 201.420(e).
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Rule 440 \21\ sets forth the requirements regarding appeals of
determinations by the PCAOB. Rule 440(d) \22\ currently requires the
PCAOB to certify and file with the Commission one copy of the record
upon which it took the complained of action, to file with the
Commission three copies of an index to such record, and to serve upon
each party one copy of the index within fourteen days after receiving
an application for review. The proposed amendment would require the
PCAOB to file such information electronically. Further, if such
information contains sensitive personal information, the PCAOB would be
required to file electronically a redacted copy of the record and index
that redacts or omits the sensitive personal information and to certify
that any sensitive personal information has been excluded or redacted.
The requirements for filing and serving would continue to be governed
by Rules 150-152.
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\21\ 17 CFR 201.440.
\22\ 17 CFR 201.440(d).
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The United States Postal Service changed the name of the product
known as Express Mail to Priority Mail Express. Rule 141(a)(2)(i),
(ii), (iii), (vi), (a)(3) and Rule 150(a)(2), (d) would be amended to
refer generically to ``express mail.''
III. Request for Public Comment
We request and encourage any interested person to submit comments
regarding: (1) The definition of sensitive personal information, (2)
the potential adverse effects, if any, of disclosing personal email
addresses and home addresses of parties and persons filing documents
with the Commission, (3) alternative approaches to handling personal
email addresses and home addresses of parties and persons filing
documents with the Commission, (4) the other proposed changes that are
the subject of this release, (5) additional or different changes, or
(6) other matters that may have an effect on the proposals contained in
this release.
IV. Administrative Procedure Act, Regulatory Flexibility Act, and
Paperwork Reduction Act
The Commission finds, in accordance with Section 553(b)(3)(A) of
the Administrative Procedure Act,\23\ that these revisions relate
solely to agency organization, procedure, or practice. They are
therefore not subject to the provisions of the Administrative Procedure
Act requiring notice, opportunity for public comment, and publication.
The Regulatory Flexibility Act \24\ therefore does not apply.\25\
Nonetheless, the Commission has determined that it would be useful to
publish these proposed rules for notice and comment before adoption.
Because these rules relate to ``agency organization, procedure or
practice that does not substantially affect the rights or obligations
of non-agency parties,'' they are not subject to the Small Business
Regulatory Enforcement Fairness Act.\26\ To the extent these rules
relate to agency information collections during the conduct of
administrative proceedings, they are exempt from review under the
Paperwork Reduction Act.\27\
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\23\ 5 U.S.C. 553(b)(3)(A).
\24\ 5 U.S.C. 601-612.
\25\ See 5 U.S.C. 603.
\26\ 5 U.S.C. 804(3)(C).
\27\ See 44 U.S.C. 3518(c)(1)(B)(ii); 5 CFR 1320.4 (exempting
collections during the conduct of administrative proceedings or
investigations).
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V. Economic Analysis
The Commission is sensitive to the costs and benefits of its rules.
The current processes and filing requirements for administrative
proceedings serve as the baseline against which the economic impacts of
the proposed rules are measured. At present, submissions are permitted
to be filed with the Commission in paper format or by facsimile
followed by a paper submission. The Commission's current Rules of
Practice do not identify sensitive personal information that must be
redacted from these documents by those who file them. Instead, such
redaction is undertaken by the Commission when necessary in responding
to document requests from the public or posting documents on the
Commission's public Web site. Service by email is already generally an
accepted practice by parties to administrative proceedings who mutually
agree to it, although it is not expressly permitted by rule.
The scope of the benefits and costs of the proposed rules depends
on the expected volume of administrative proceedings and the number of
filed documents and document requests associated with these
proceedings. In fiscal year 2014, 230 new administrative proceedings
were initiated and not settled immediately. New proceedings initiated
and not immediately settled in fiscal years 2013 and 2012 totaled 202
and 207 respectively.\28\ From 2011 to 2013, an average of
approximately 1,900 filings were submitted per fiscal year in relation
to litigated proceedings, including filings by outside parties as well
as Commission staff. These filings consist of one or more documents,
such as motions, briefs, and record exhibits, and the length of the
filings generally ranges from one page to a few thousand pages. The
Commission also received numerous requests from the public to release
documents related to these proceedings. Requests for records related to
administrative proceedings (both settled and litigated) numbered 127,
83, and 100 for fiscal years 2013, 2012, and 2011 respectively.
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\28\ The total number of administrative proceedings initiated
and not immediately settled each fiscal year encompasses a variety
of types of proceedings, including proceedings instituted pursuant
to Section 12(j) of the Securities Exchange Act of 1934 seeking to
determine whether it is necessary and appropriate for the protection
of investors to suspend or revoke the registration of an issuer's
securities and proceedings instituted under Section 15(b) of the
Exchange Act or Section 203(f) of the Investment Advisers Act of
1940 seeking to determine what, if any, remedial action is
appropriate in the public interest.
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The implementation of electronic filing and the related proposed
rules are intended to improve the efficiency and transparency of the
Commission's operations and to modernize the document management
process to be consistent with common practice in other tribunals.
Benefits of the proposed rules are anticipated to accrue to the public
and outside parties to administrative proceedings as well as the
Commission.
Specifically, the proposed rules may benefit members of the public
with an interest in the Commission's administrative proceedings by
permitting the Commission to more
[[Page 60087]]
quickly make public the documents relating to these proceedings. The
proposed rules may increase the speed at which information from
administrative proceedings is transmitted as well as the overall
transparency of these proceedings. Additionally, parties to
administrative proceedings may benefit from the increased flexibility
enabled by the changes, such as the Commission's acceptance of
electronic and facsimile submissions until midnight rather than the
close of business on a given day. These parties may also benefit from
savings on printing and mailing costs because, after the phase-in
period, filing paper copies generally will not be required. In
addition, the changes expressly require service by electronic means,
which may increase further the savings in printing and mailing. The
Commission's response to document requests is expected to be more time-
and cost-effective due to the efficiency of electronic retrieval and
the fact that sensitive information will have been redacted in advance.
However, the magnitude of the above benefits is difficult to quantify
due to the limitations of existing data.
The costs of the proposal will be borne by the Commission as well
as the outside parties to administrative proceedings. The proposed
rules place the primary burden of redacting sensitive personal
information on the parties submitting documents in administrative
proceedings--either outside parties or Commission staff--following
common practice in federal courts. The Commission believes that parties
filing documents are well positioned to redact the documents--or
initially draft documents to avoid the use of sensitive personal
information--and that the proposed narrow definition of sensitive
personal information will limit the burden on parties required to
redact documents. The Commission recognizes, however, that the costs of
reviewing and editing the content to protect sensitive information
might be significant for some parties. Additionally, when sensitive
personal information is necessary to the proceedings, outside parties
or the Commission may expend additional resources filing a motion for a
protective order in accordance with Rule 322 to limit disclosure of the
sensitive information and to prepare a redacted and unredacted version
of the documents.
Parties to administrative proceedings will also bear any
incremental burden of electronic filings over the current practice of
facsimile or paper transmissions. The magnitude of costs will depend
primarily on whether the original format of the documents to be
submitted is electronic or whether they must be scanned or otherwise
converted to an electronic format. Other factors that may affect these
costs include the ease of access the party has to the internet and to
any hardware and software that may be involved in processing the
documents. For most parties, we do not expect these costs to be
significant because, among other things, most parties already are
subject to similar requirements in other kinds of legal proceedings or
have access to the Internet and conversion programs at a reasonable
cost. Further, these potential burdens may be mitigated for some
parties as the proposed rules provide for relief from the electronic
filing requirements in situations in which a party certifies a
reasonable inability to comply with the electronic filing requirements.
As an alternative to the proposed rules, the Commission could
implement electronic filing with different requirements. In particular,
the Commission could continue to allow the filing of unredacted
documents--requiring that redaction be undertaken by Commission staff
when necessary--or could permit electronic filing on a voluntary,
rather than mandatory, basis. Relative to these alternatives, or to the
existing paper format and facsimile document submission and management
system for administrative proceedings, the Commission believes that the
proposed changes achieve the benefits described above in a cost-
efficient manner. The Commission does not expect significant effects on
efficiency, competition, or capital formation to result from the
proposed changes. And to the extent that the changes impose any burden
on competition, the Commission believes that such burden would be
necessary and appropriate in furtherance of the purposes of the
Exchange Act.\29\
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\29\ See 15 U.S.C. 78w(a)(2).
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The Commission requests comment on all aspects of the economic
effects of the proposal, including any anticipated impacts that are not
mentioned here. We are particularly interested in quantitative
estimates of the benefits and costs, in general or for particular types
of participants in administrative proceedings, including smaller
entities. We also request comment on reasonable alternatives to the
proposed rules and on any effect the proposed rules may have on
efficiency, competition, and capital formation.
VI. Statutory Basis and Text of Proposed Amendments
These amendments to the Rules of Practice are being proposed
pursuant to statutory authority granted to the Commission, including
section 3 of the Sarbanes-Oxley Act of 2002, 15 U.S.C. 7202; section 19
of the Securities Act, 15 U.S.C. 77s; sections 4A, 19, and 23 of the
Exchange Act, 15 U.S.C. 78d-1, 78s, and 78w; section 319 of the Trust
Indenture Act of 1939, 15 U.S.C. 77sss; sections 38 and 40 of the
Investment Company Act, 15 U.S.C. 80a-37 and 80a-39; and section 211 of
the Investment Advisers Act, 15 U.S.C. 80b-11.
List of Subjects in 17 CFR Part 201
Administrative practice and procedure.
Text of the Amendments
For the reasons set out in the preamble, 17 CFR part 201 is
proposed to be amended as follows:
PART 201--RULES OF PRACTICE
0
4. The authority citation for Part 201, subpart D, is revised to read
as follows:
Authority: 15 U.S.C. 77f, 77g, 77h, 77h-1, 77j, 77s, 77u,
78c(b), 78d-1, 78d-2, 78l, 78m, 78n, 78o(d), 78o-3, 78s, 78u-2, 78u-
3, 78v, 78w, 77sss, 77ttt, 80a-8, 80a-9, 80a-37, 80a-38, 80a-39,
80a-40, 80a-41, 80a-44, 80b-3, 80b-9, 80b-11, 80b-12, 7202, 7215,
and 7217.
0
5. Section 201.102 is amended by revising paragraphs (d)(1), (d)(2),
and (d)(4) to read as follows:
Sec. 201.102 Appearance and practice before the Commission.
* * * * *
(d) Designation of address for service; notice of appearance; power
of attorney; withdrawal--(1) Representing oneself. When an individual
first makes any filing or otherwise appears on his or her own behalf
before the Commission or a hearing officer in a proceeding as defined
in Sec. 201.101(a), he or she shall file with the Commission, or
otherwise state on the record, and keep current, a mailing address and
email address at which any notice or other written communication
required to be served upon him or her or furnished to him or her may be
sent and a telephone number where he or she may be reached during
business hours.
(2) Representing others. When a person first makes any filing or
otherwise appears in a representative capacity before the Commission or
a hearing officer in a proceeding as defined in Sec. 201.101(a), that
person shall file with the Commission, and
[[Page 60088]]
keep current, a written notice stating the name of the proceeding; the
representative's name, business address, email address, and telephone
number; and the name, email address, and address of the person or
persons represented.
* * * * *
(4) Withdrawal. Any person seeking to withdraw his or her
appearance in a representative capacity shall file a notice of
withdrawal with the Commission or the hearing officer. The notice shall
state the name, mailing address, email address, and telephone number of
the withdrawing representative; the name, address, and telephone number
of the person for whom the appearance was made; and the effective date
of the withdrawal. If the person seeking to withdraw knows the name,
mailing address, email address, and telephone number of the new
representative, or knows that the person for whom the appearance was
made intends to represent him- or herself, that information shall be
included in the notice. The notice must be served on the parties in
accordance with Sec. 201.150. The notice shall be filed at least five
days before the proposed effective date of the withdrawal.
* * * * *
0
6. Section 201.140 is amended by revising paragraph (a) to read as
follows:
Sec. 201.140 Commission orders and decisions: Signature and
availability.
* * * * *
(a) Signature required. All orders and decisions of the Commission
shall be signed by the Secretary or any other person duly authorized by
the Commission. The signature may be an electronic signature that
consists of an ``/s/'' notation or any other digital signature.
* * * * *
0
7. Section 201.141 is amended by:
0
a. Removing the words ``Express Mail'' each time they appear and adding
in their place the words ``express mail''; and
0
b. Revising the first sentence of paragraph (b).
The revision reads as follows:
Sec. 201.141 Orders and decisions: Service of orders instituting
proceedings and other orders and decisions.
* * * * *
(b) Service of Orders or Decisions Other than an Order Instituting
Proceedings. Written orders or decisions issued by the Commission or by
a hearing officer shall be served promptly on each party pursuant to
any method of service authorized under paragraph (a) of this section or
Sec. 201.150(c) and (d). * * *
0
8. Section 201.150 is amended by:
0
a. Redesignating paragraphs (c) and (d) as paragraphs (d) and (e);
0
b. Adding new paragraph (c);
0
c. Revising newly redesignated paragraphs (d) introductory text and
(d)(4);
0
d. Revising newly redesignated paragraph (e); and
0
e. Removing the words ``Express Mail'' each time they appear and adding
in their place the words ``express mail''.
The revisions and addition read as follows:
Sec. 201.150 Service of papers by parties.
* * * * *
(c) How made. Service shall be made electronically in the form and
manner that is prescribed in the guidance posted on the Commission's
Web site. Persons serving each other shall have provided the Commission
and the parties with notice of an email address.
(1) Certification of inability to serve electronically. If a person
reasonably cannot serve electronically, due to a lack of access to
electronic transmission devices (due to incarceration or otherwise),
the person promptly shall file a certification under this paragraph
that explains why the person reasonably cannot comply. The filing also
must indicate the expected duration of the person's reasonable
inability to comply, such as whether the certification is intended to
apply to a solitary instance of service or all instances of service
made during the proceeding. The certification is immediately effective.
Upon filing the certification, it will be part of the record of the
proceeding, and the person may serve paper documents by any additional
method listed in Rule 150(d).
(d) Additional methods of service. If a person reasonably cannot
serve electronically, or if service is of an investigative subpoena
pursuant to 17 CFR 203.8, service may be made by delivering a copy of
the filing. Delivery means:
* * * * *
(4) Transmitting the papers by facsimile transmission to the person
required to be served. The persons so serving each other shall have
provided the Commission and the parties with notice of a facsimile
machine telephone number.
(e) When service is complete. Electronic service is complete upon
transmission. Personal service, service by U.S. Postal Service express
mail or service by a commercial courier or express delivery service is
complete upon delivery. Service by mail is complete upon mailing.
Service by facsimile is complete upon confirmation of transmission.
0
9. Section 201.151 is amended by revising paragraphs (a) and (d) and
adding paragraph (e) to read as follows:
Sec. 201.151 Filing of papers with the Commission: Procedure.
(a) When to file. All papers required to be served upon any person
shall also be filed contemporaneously with the Commission
electronically pursuant to the requirements of Sec. 201.152(a). The
person making such filing is responsible for ensuring that the
Commission receives a complete and legible filing within the time limit
set for such filing. Documents that are attached to filings shall be
filed in accordance with this Rule. Documents or items that are not
attached to filings (i.e., are admitted by the hearing officer at an
in-person hearing), shall be submitted in accordance with Sec.
201.351.
* * * * *
(d) Certificate of service. Papers filed with the Commission or a
hearing officer shall be accompanied by a certificate stating the name
of the person or persons served, the date of service, the method of
service, and the mailing address or email address to which service was
made, if not made in person.
(e) Sensitive personal information. Sensitive personal information
is defined as a Social Security number, taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, state-issued identification number,
home address (other than city and state), telephone number, date of
birth (other than year), names and initials of minor children, as well
as any sensitive health information identifiable by individual, such as
an individual's medical records. Sensitive personal information shall
not be included in, and must be redacted or omitted from, all filings
subject to:
(1) Exceptions. The following information may be included and is
not required to be redacted from filings:
(i) The last four digits of a taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, and state-issued identification
number;
(ii) Home addresses and telephone numbers of parties and persons
filing documents with the Commission;
(iii) Business telephone numbers; and
(iv) Copies of unredacted filings by regulated entities or
registrants that are available on the Commission's public Web site.
[[Page 60089]]
(2) Confidential treatment of information. If the person making any
filing believes that sensitive personal information (as defined above)
contained therein is necessary to the proceeding, the person shall file
unredacted documents, along with a motion for a protective order in
accordance with Sec. 201.322 to limit disclosure of unredacted
sensitive personal information.
(3) Certification. Any filing must include a certification that any
sensitive personal information as defined in Sec. 201.151(e) has been
excluded or redacted from the filing or, if necessary to the filing,
has been filed under seal pursuant to Sec. 201.322.
0
10. Section 201.152 is amended by:
0
a. Removing paragraph (d);
0
b. Redesignating paragraphs (b) and (c) as paragraphs (c) and (d);
0
c. Redesignating paragraph (a) as paragraph (b) and revising it;
0
d. Adding new paragraph (a);
0
e. Removing newly redesignated paragraph (b)(6);
0
f. Revising newly designated paragraph (c); and
0
g. Removing the phrase ``or microfilming'' from newly redesignated
paragraph (d).
The revisions and addition read as follows:
Sec. 201.152 Filing of papers: Form.
(a) Electronic filing. Papers filed in connection with any
proceeding as defined in Sec. 201.101(a) shall be filed electronically
in the form and manner that is prescribed in the guidance posted on the
Commission's Web site. Papers filed electronically must be received by
the Commission by midnight Eastern Time on the date the filing is due.
(1) Certification of Inability to File Electronically. If a person
reasonably cannot comply with the requirements of this section, due to
a lack of access to electronic transmission devices (due to
incarceration or otherwise), the person promptly shall file a
certification under this paragraph that explains why the person
reasonably cannot comply. The filing also must indicate the expected
duration of the person's reasonable inability to comply, such as
whether the certification is intended to apply to a solitary filing or
all filings made during the proceeding. The certification is
immediately effective. Upon filing the certification, it will be part
of the record of the proceeding, and the person may file paper
documents by any additional method listed in Sec. 201.152(a)(2).
(2) Additional methods of filing. If a person reasonably cannot
file electronically, filing may be made by hand delivering the filing
by 5:30 p.m. Eastern Time through a commercial courier service or
express delivery service; mailing the filing through the U.S. Postal
Service by first class, certified, registered, or express mail delivery
so that it is received by the Commission by 5:30 p.m. Eastern Time; or
transmitting the filing by facsimile transmission so that it is
received by the Commission by midnight Eastern Time.
(b) Form. Papers filed in connection with any proceeding as defined
in Sec. 201.101(a) shall:
(1) Reflect a page, electronically or otherwise, that measures 8\1/
2\ x 11 inches when printed, except that, to the extent that the
reduction of larger documents would render them illegible when printed,
such documents may be filed on larger paper;
(2) Use 12-point or larger typeface;
(3) Include at the head of the paper, or on a title page, the name
of the Commission, the title of the proceeding, the names of the
parties, the subject of the particular paper or pleading, and the file
number assigned to the proceeding;
(4) Be paginated with left hand margins at least 1 inch wide, and
other margins of at least 1 inch; and
(5) Be double-spaced, with single-spaced footnotes and single-
spaced indented quotations.
(c) Signature required. All papers must be dated and signed as
provided in Sec. 201.153. Electronic filings that require a signature
pursuant to Sec. 201.153 may be signed with an ``/s/'' notation, which
shall be deemed the signature of the person making the filing for
purposes of Sec. 201.153.
(d) Suitability for recordkeeping. Documents which, in the opinion
of the Commission, are not suitable for computer scanning may be
rejected.
* * * * *
0
11. Section 201.193 is amended by revising paragraph (b) introductory
text to read as follows:
Sec. 201.193 Applications by barred individuals for consent to
associate.
* * * * *
(b) Form of application. Each application shall be supported by an
affidavit, signed by the applicant, that addresses the factors set
forth in paragraph (d) of this section. The application shall be filed
pursuant to Sec. Sec. 201.151, 201.152 and 201.153. Each application
shall include as exhibits:
* * * * *
0
12. Section 201.322 is amended by revising paragraph (a), redesignating
paragraphs (b), (c), and (d) as paragraphs (c), (d), and (e), and
adding new paragraph (b).
The revision and addition read as follows:
Sec. 201.322 Evidence: Confidential information, protective orders.
(a) Procedure. In any proceeding as defined in Sec. 201.101(a), a
party, any person who is the owner, subject or creator of a document
subject to subpoena or which may be introduced as evidence, or any
witness who testifies at a hearing may file a motion requesting a
protective order to limit from disclosure to other parties or to the
public documents or testimony that contain confidential information.
The motion should include a general summary or extract of the documents
without revealing confidential details.
(b) If review of the documents that are the subject of a request
for a protective order is necessary to a ruling on the motion and the
information as to which a protective order is sought is available to
the movant, the motion shall be accompanied by:
(1) A complete, sealed copy of the materials containing the
information as to which a protective order is sought, with the
allegedly confidential information marked as such, and with the first
page of the document labeled ``Under Seal.'' If the movant seeks a
protective order against disclosure to other parties as well as the
public, copies of the documents shall not be served on other parties;
and
(2) A redacted copy of the materials containing the information as
to which a protective order is sought, with the allegedly confidential
information redacted. The redacted version shall indicate any omissions
with brackets or ellipses, and its pagination and depiction of text on
each page shall be identical to that of the sealed version. A redacted
copy need not accompany a motion requesting a protective order if the
materials would be redacted in their entirety.
* * * * *
0
13. Section 201.351 is amended by revising paragraph (b), redesignating
paragraph (c) as paragraph (d), and adding new paragraph (c).
The revision and addition read as follows:
Sec. 201.351 Transmittal of documents to Secretary; record index;
electronic copy of exhibits; certification.
* * * * *
(b) Preparation, certification of record index. Promptly after the
close of the hearing, the hearing officer shall transmit to the
Secretary an index of the originals of any motions, exhibits or any
other documents filed with or accepted into evidence by the hearing
officer that have not been previously transmitted to the Secretary, and
the Secretary shall prepare a record index. Prior to issuance
[[Page 60090]]
of an initial decision, or if no initial decision is to be prepared,
within 30 days of the close of the hearing, the Secretary shall
transmit the record index to the hearing officer and serve a copy of
the record index on each party. Any person may file proposed
corrections to the record index with the hearing officer within three
days of service of the record index. Any opposition to the proposed
corrections shall be filed within three days of service of the proposed
corrections. The hearing officer shall, by order, direct whether any
corrections to the record index shall be made. The Secretary shall make
such corrections, if any, and issue a revised record index. If an
initial decision is to be issued, the initial decision shall include a
certification that the record consists of the items set forth in the
record index or revised record index issued by the Secretary.
(c) Electronic exhibits. Within two weeks after the close of a
hearing, the parties shall submit electronically to the Secretary a
copy of all exhibits that were admitted, or offered and not admitted,
during the hearing, and any other exhibits that were admitted after the
hearing. The parties shall submit such evidence in the form and manner
that is prescribed in the guidance posted on the Commission's Web site.
(1) Sensitive personal information. Sensitive personal information
is defined as a Social Security number, taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, state-issued identification number,
home address (other than city and state), telephone number, date of
birth (other than year), names and initials of minor children, as well
as any sensitive health information identifiable by individual, such as
an individual's medical records. Sensitive personal information shall
not be included in, and must be redacted or omitted from, all filings
subject to:
(i) Exceptions. The following information may be included and is
not required to be redacted from filings:
(A) The last four digits of a taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, and state-issued identification
number;
(B) Home addresses and telephone numbers of parties and persons
filing documents with the Commission;
(C) Business telephone numbers; and
(D) Copies of unredacted filings by regulated entities or
registrants that are available on the Commission's public Web site.
(ii) Confidential treatment of information. If the person
submitting record exhibits and other documents or items that are not
attached to filings believes that sensitive personal information (as
defined in Sec. 201.351(c)(1)) contained therein is necessary to the
proceeding, the person shall file unredacted documents, along with a
motion for a protective order in accordance with Sec. 201.322 to limit
disclosure of unredacted sensitive personal information.
(2) Certification of inability to submit exhibits electronically. A
person who reasonably cannot submit exhibits electronically must file a
certification under Sec. 201.351(c)(2) that explains why the person
reasonably cannot comply. The filing also must indicate the expected
duration of the person's reasonable inability to comply, such as
whether the certification is intended to apply to a solitary submission
or all submissions made during the proceeding. The certification is
immediately effective. Upon filing the certification, it will be part
of the record of the proceeding, and the person shall submit originals
of any exhibits that have not already been submitted to the Secretary
by other means.
(3) Signature requirement. Electronic submissions that require a
signature pursuant to Sec. 201.153 may be signed with an ``/s/''
notation, which shall be deemed the signature of the person making the
submission for purposes of Sec. 201.153.
(4) Certification. The parties shall certify that exhibits and
other documents or items submitted to the Secretary under this rule:
(i) Are true and accurate copies of exhibits that were admitted, or
offered and not admitted, during the hearing; and
(ii) That any sensitive personal information as defined in Sec.
201.351(c) has been excluded or redacted, or, if necessary, has been
filed under seal pursuant to Sec. 201.322.
* * * * *
0
14. Section 201.420 is amended by revising paragraph (e) to read as
follows:
Sec. 201.420 Appeal of determinations by self-regulatory
organizations.
* * * * *
(e) Certification of the record; service of the index. Fourteen
days after receipt of an application for review or a Commission order
for review, the self-regulatory organization shall certify and file
electronically in the form and manner that is prescribed in the
guidance posted on the Commission's Web site one unredacted copy of the
record upon which the action complained of was taken. If such record
contains any sensitive personal information, as defined in paragraph
(e)(1) of this section, the self-regulatory organization also shall
file electronically with the Commission one redacted copy of such
record, subject to the following:
(1) Sensitive personal information. Sensitive personal information
is defined as a Social Security number, taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, state-issued identification number,
home address (other than city and state), telephone number, date of
birth (other than year), names and initials of minor children, as well
as any sensitive health information identifiable by individual, such as
an individual's medical records. Sensitive personal information shall
not be included in, and must be redacted or omitted from, all filings
subject to:
(i) Exceptions. The following information may be included and is
not required to be redacted from filings:
(A) The last four digits of a taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, and state-issued identification
number;
(B) Home addresses and telephone numbers of parties and persons
filing documents with the Commission;
(C) Business telephone numbers; and
(D) Copies of unredacted filings by regulated entities or
registrants that are available on the Commission's public Web site.
(ii) [Reserved]
(2) Index. The self-regulatory organization also shall file
electronically with the Commission one copy of an index to such record,
and shall serve upon each party one copy of the index. If such index
contains any sensitive personal information, as defined in paragraph
(e)(1) of this section, the self-regulatory organization also shall
file electronically with the Commission one redacted copy of such
index, subject to the requirements of paragraphs (e)(1) introductory
text and (e)(1)(i).
(3) Certification. Any filing made pursuant to this section must
include a certification that any sensitive personal information as
defined in Sec. 201.420(e)(1) has been excluded or redacted from the
filing.
0
15. Section 201.440 is amended by revising paragraph (d) to read as
follows:
Sec. 201.440 Appeal of determinations by the Public Company
Accounting Oversight Board.
* * * * *
[[Page 60091]]
(d) Certification of the record; service of the index. Within
fourteen days after receipt of an application for review, the Board
shall certify and file electronically in the form and manner that is
prescribed in the guidance posted on the Commission's Web site one
unredacted copy of the record upon which it took the complained-of
action. If such record contains any sensitive personal information, as
defined in paragraph (d)(1) of this section, the Board also shall file
electronically with the Commission one redacted copy of such record,
subject to the following:
(1) Sensitive personal information. Sensitive personal information
is defined as a Social Security number, taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, state-issued identification number,
home address (other than city and state), telephone number, date of
birth (other than year), names and initials of minor children, as well
as any sensitive health information identifiable by individual, such as
an individual's medical records. Sensitive personal information shall
not be included in, and must be redacted or omitted from, all filings
subject to:
(i) Exceptions. The following information may be included and is
not required to be redacted from filings:
(A) The last four digits of a taxpayer identification number,
financial account number, credit card or debit card number, passport
number, driver's license number, and state-issued identification
number;
(B) Home addresses and telephone numbers of parties and persons
filing documents with the Commission;
(C) Business telephone numbers; and
(D) Copies of unredacted filings by regulated entities or
registrants that are available on the Commission's public Web site.
(ii) [Reserved]
(2) Index. The Board shall file electronically with the Commission
one copy of an index of such record, and shall serve one copy of the
index on each party. If such index contains any sensitive personal
information, as defined in paragraph (d)(1) of this section, the Board
also shall file electronically with the Commission one redacted copy of
such index, subject to the requirements of paragraphs (d)(1)
introductory text and (d)(1)(i).
(3) Certification. Any filing made pursuant to this section must
include a certification that any sensitive personal information as
defined in Sec. 201.440(d)(1) has been excluded or redacted from the
filing.
By the Commission.
Dated: September 24, 2015.
Brent J. Fields,
Secretary.
[FR Doc. 2015-24705 Filed 10-2-15; 8:45 am]
BILLING CODE 8011-01-P
