2006 – Federal Register Recent Federal Regulation Documents

The Securities and Exchange Commission is publishing for comment proposed rules and rule amendments regarding exemptions from the definitions of ``broker'' and ``dealer'' under the Securities Exchange Act of 1934 (``Exchange Act'') for banks'' securities activities. In particular, the Commission is re-proposing a conditional exemption originally proposed in 2004 that would allow banks to effect riskless principal transactions with non-U.S. persons pursuant to Regulation S under the Securities Act of 1933 (``Securities Act''). The Commission also is proposing to amend and redesignate an existing exemption from the definition of ``dealer'' for banks' securities lending activities as a conduit lender. In addition, the Commission is proposing to amend a rule that grants a limited exemption from U.S. broker-dealer registration for foreign broker-dealers, conforming the rule to amended definitions of ``broker'' and ``dealer'' under the Exchange Act. Finally, the Commission is requesting comment on its intention to withdraw a rule defining the term ``bank'' for purposes of Sections 3(a)(4) and 3(a)(5) of the Exchange Act, because of judicial invalidation, a time-limited exemption for banks' securities activities, because of the passage of time, and an exemption from the definition of ``broker'' and ``dealer'' for savings associations and savings banks, an exemption no longer necessary because of the passage of the Regulatory Relief Act.

The Office of the Comptroller of the Currency (OCC), Board of Governors of the Federal Reserve System (Board), Federal Deposit Insurance Corporation (FDIC), and Office of Thrift Supervision (OTS) (collectively, the Agencies) are proposing revisions to the existing risk-based capital framework that would enhance its risk sensitivity without unduly increasing regulatory burden. These changes would apply to banks, bank holding companies, and savings associations (banking organizations). A banking organization would be able to elect to adopt these proposed revisions or remain subject to the Agencies' existing risk-based capital rules, unless it uses the Advanced Capital Adequacy Framework proposed in the notice of proposed rulemaking published on September 25, 2006 (Basel II NPR). In this notice of proposed rulemaking (NPR or Basel IA), the Agencies are proposing to expand the number of risk weight categories, allow the use of external credit ratings to risk weight certain exposures, expand the range of recognized collateral and eligible guarantors, use loan-to-value ratios to risk weight most residential mortgages, increase the credit conversion factor for certain commitments with an original maturity of one year or less, assess a charge for early amortizations in securitizations of revolving exposures, and remove the 50 percent limit on the risk weight for certain derivative transactions. A banking organization would have to apply all the proposed changes if it chose to use these revisions. Finally, in Section III of this NPR, the Agencies seek further comment on possible alternatives for implementing the ``International Convergence of Capital Measurement and Capital Standards: A Revised Framework'' (Basel II) in the United States as proposed in the Basel II NPR.

The Pacific Fishery Management Council (Council) has begun its annual preseason management process for the 2007 ocean salmon fisheries. This document announces the availability of Council documents as well as the dates and locations of Council meetings and public hearings comprising the Council's complete schedule of events for determining the annual proposed and final modifications to ocean salmon fishery management measures. The agendas for the March and April 2007 Council meetings will be published in subsequent Federal Register documents prior to the actual meetings.

On April 26, 2004, EPA issued the National Emission Standards for Hazardous Air Pollutants: Surface Coating of Automobiles and Light- Duty Trucks (Automobiles and Light-Duty Trucks NESHAP) under section 112(d) of the Clean Air Act. We are proposing to amend the final rule to provide the option of including surface coating of heavier motor vehicles under this rule. This action also proposes to amend the National Emission Standards for Hazardous Air Pollutants for Surface Coating of Miscellaneous Metal Parts and Products (Miscellaneous Metal Parts NESHAP) and the National Emission Standards for Hazardous Air Pollutants for Surface Coating of Plastic Parts and Products (Plastic Parts NESHAP) to maintain consistency between these rules and the Automobiles and Light-Duty Trucks NESHAP. These proposed amendments appear in the Rules and Regulations Section of this Federal Register as a direct final rule.

The Food and Drug Administration (FDA) is amending a medical device regulation to include references to the Center for Biologics Evaluation and Research (CBER) and the Center for Drug Evaluation and Research (CDER). This regulation pertains to the disqualification of a clinical investigator. Currently, only a reference to the Center for Devices and Radiological Health is listed in this regulation. This action is being taken to ensure the accuracy of FDA's regulations.

This rule implements 10 U.S.C 982 to establish uniform DoD policies for jury service by members of the Armed Forces on active duty. The provisions of this rule impact active-duty members of the Armed Forces. This updated rule contains editorial changes only as required for internal Department of Defense mandated reconsideration every 5 years.

We propose to adopt a new airworthiness directive (AD) for the products listed above. This proposed AD results from mandatory continuing airworthiness information (MCAI) issued by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as cracks found on several main landing gear cylinders. The proposed AD would require actions that are intended to address the unsafe condition described in the MCAI.

This rule amends the structure of the Administrative Committee (Committee) of the National Potato Promotion Board (Board) as prescribed in the Potato Research and Promotion Plan by increasing the number of Vice-Chairperson positions on the Committee from six to seven. The change is intended to more closely correlate the Committee's representation with potato production in the Northwest districta five state region which accounts for more than half of all U.S. potato production.

This document contains corrections to a notice of proposed rulemaking by cross-reference to temporary regulations, notice of proposed rulemaking, and notice of public hearing that was published in the Federal Register on Friday, August 4, 2006 (71 FR 44247) relating to the treatment of controlled services transactions under section 482. These regulations also provide guidance regarding the allocation of income from intangibles, in particular with respect to contributions by a controlled party to the value of an intangible owned by another controlled party, as it relates to controlled services transactions, and modify the regulations under section 861 concerning stewardship expenses to be consistent with the changes made to the regulations under section 482.

This document contains corrections to final and temporary regulations (TD 9278) that was published in the Federal Register on Friday, August 4, 2006 (71 FR 44466) regarding the treatment of controlled services transactions under section 482 and the allocation of income from intangibles, in particular with respect to contributions by a controlled party to the value of an intangible owned by another controlled party. This document also contains corrections to final and temporary regulations that modify the regulations under section 861 concerning stewardship expenses to be consistent with the changes made to the regulations under section 482.

EPA is approving a revision to the Ohio State Implementation Plan (SIP) submitted by Ohio on April 11, 2005 to rescind a rule which affected stationary combustion sources located within Priority I regions of the State and new sources regardless of location. The rule revision we are approving here also applies to nitric acid manufacture. We are taking this action at the request of the Ohio Environmental Protection Agency (Ohio EPA) because this rule is no longer the limiting regulation for any oxides of nitrogen (NOX) emission units in the State. The rule was originally approved by EPA over 30 years ago and since then has been superseded by a number of more stringent State and Federal regulations. The Ohio NOX SIP call rules and Federal emission standards for utility and industrial units all have greater potential for reducing emissions of NOX and improving human health than does the State's rescinded rule.

The National Credit Union Administration (NCUA) is issuing final revisions to its rules regarding the conversion of insured credit unions to mutual savings banks or mutual savings associations. The final rule improves the information available to members and the board of directors as they consider a possible conversion. The final rule includes revised disclosures, revised voting procedures, procedures to facilitate communications among members, and procedures for members to provide their comments to directors before the credit union board votes on a conversion plan.

This notice proposes to amend Part 71 of the Federal Aviation Regulations (14 CFR Part 71) by establishing a Class E airspace area extending upward from 700 feet above the surface at Potosi, Washington County Airport, MO.

This proposed rule would implement the provisions of the Deficit Reduction Act of 2005 (DRA) pertaining to prescription drugs under the Medicaid program. The DRA requires the Secretary of Health and Human Services to publish a final regulation no later than July 1, 2007. In addition, we would add to existing regulations certain established Medicaid rebate policies that are currently set forth in CMS guidance. This rule would bring together existing and new regulatory requirements in one, cohesive subpart.

In the Rules and Regulations section of this issue of the Federal Register, the IRS is issuing temporary regulations that affect component members of controlled groups of corporations and consolidated groups filing life-nonlife Federal income tax returns. They provide guidance regarding the apportionment of tax benefit items and the amount and type of information these members are required to submit with their returns. The text of those regulations also serves as the text of these proposed regulations.

The Food and Drug Administration (FDA) is establishing January 1, 2010, as the uniform compliance date for food labeling regulations that are issued between January 1, 2007, and December 31, 2008. FDA periodically announces uniform compliance dates for new food labeling requirements to minimize the economic impact of label changes. On March 14, 2005, FDA established January 1, 2008, as the uniform compliance date for food labeling regulations that issued between March 14, 2005, and December 31, 2006.

NMFS has determined that the daily Atlantic bluefin tuna (BFT) retention limits for the Atlantic tunas General category should be adjusted to provide reasonable opportunity to harvest the General category January time-period subquota. Therefore, NMFS increases the daily BFT retention limits for the entire month of January, including previously scheduled Restricted Fishing Days (RFDs), to provide enhanced commercial General category fishing opportunities in all areas while minimizing the risk of an overharvest of the General category BFT quota.

This amendment adopts miscellaneous amendments to the required IFR (instrument flight rules) altitudes and changeover points for certain Federal airways, jet routes, or direct routes for which a minimum or maximum en route authorized IFR altitude is prescribed. This regulatory action is needed because of changes occurring in the National Airspace System. These changes are designed to provide for the safe and efficient use of the navigable airspace under instrument conditions in the affected areas.

OSHA routinely conducts reviews of its existing safety and health standards to improve and update them. As part of this ongoing process, OSHA is issuing this ANPRM to initiate Phase III of the Standards Improvement Project (SIPs III). SIPs III is the third in a series of rulemaking actions intended to improve and streamline OSHA standards by removing or revising individual requirements within rules that are confusing, outdated, duplicative, or inconsistent. These revisions maintain or enhance employees' safety and health, while reducing regulatory burdens where possible. OSHA has already identified a number of provisions that are potential candidates for inclusion in SIPs III. These candidates include recommendations received from the public in other rulemakings. The purpose of this notice is to invite comment on these recommendations, as well as provide an opportunity for commenters to suggest other candidates that might be appropriate for inclusion in this rulemaking. OSHA will use the information received in response to this notice to help determine the scope of SIPs III.

We are extending further for smaller public companies the dates that were published on September 29, 2005, in Release No. 33-8618 [70 FR 56825], for their compliance with the internal control reporting requirements mandated by Section 404 of the Sarbanes-Oxley Act of 2002. Under the extension, a non-accelerated filer is not required to provide management's report on internal control over financial reporting until it files an annual report for its first fiscal year ending on or after December 15, 2007. If we have not issued additional guidance for management on how to complete its assessment of internal control over financial reporting in time to be of sufficient assistance in connection with annual reports filed for fiscal years ending on or after December 15, 2007, we will consider whether we should further postpone this date. A non-accelerated filer is not required to file the auditor's attestation report on internal control over financial reporting until it files an annual report for its first fiscal year ending on or after December 15, 2008. We will consider further postponing this date after we consider the anticipated revisions to Auditing Standard No. 2. Management's report included in a non-accelerated filer's annual report during the filer's first year of compliance with the Section 404(a) requirements will be deemed ``furnished'' rather than filed. Management's report for foreign private issuers filing on Form 20-F or 40-F that are accelerated filers (but not large accelerated filers) also will be deemed furnished rather than filed for the year that such issuers are only required to provide management's report. Companies that only provide management's report during their first year of compliance in accordance with our rules must state in the annual report that the report does not include the auditor's attestation report and that the company's registered public accounting firm has not attested to management's report on the company's internal control over financial reporting. We also are adopting amendments that provide for a transition period for a newly public company before it becomes subject to the internal control over financial reporting requirements. Under the new amendments, a company will not become subject to these requirements until it either had been required to file an annual report for the prior fiscal year with the Commission or had filed an annual report with the Commission for the prior fiscal year. A newly public company is required to include a statement in its first annual report that the annual report does not include either management's assessment on the company's internal control over financial reporting or the auditor's attestation report.

We are adopting a new airworthiness directive (AD) for the products listed above. This AD results from mandatory continuing airworthiness information (MCAI) issued by the aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as:

The Pipeline and Hazardous Materials Safety Administration (PHMSA), in consultation with the Federal Railroad Administration (FRA) and the Transportation Security Administration (TSA), is proposing to revise the current requirements in the Hazardous Materials Regulations applicable to the safe and secure transportation of hazardous materials transported in commerce by rail. Specifically, we are proposing to require rail carriers to compile annual data on specified shipments of hazardous materials, use the data to analyze safety and security risks along rail transportation routes where those materials are transported, assess alternative routing options, and make routing decisions based on those assessments. We are also proposing clarifications of the current security plan requirements to address en route storage, delays in transit, delivery notification, and additional security inspection requirements for hazardous materials shipments. In today's edition of the Federal Register, TSA is publishing an NPRM proposing additional security requirements for rail transportation.

FMCSA proposes regulations for entities offering intermodal chassis to motor carriers for transportation of intermodal containers in interstate commerce. As mandated by section 4118 of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU), this rulemaking would require intermodal equipment providers (IEPs) to register and file with FMCSA an Intermodal Equipment Provider Identification Report (Form MCS-150C); display the USDOT Number, or other unique identifier, on each intermodal container chassis offered for transportation in interstate commerce; establish a systematic inspection, repair, and maintenance program to ensure the safe operating condition of each intermodal container chassis; maintain documentation of the program; and provide a means to effectively respond to driver and motor carrier reports about intermodal container chassis mechanical defects and deficiencies. The proposed regulations would for the first time make IEPs subject to the Federal Motor Carrier Safety Regulations (FMCSRs). The agency is also proposing additional inspection requirements for motor carriers and drivers operating intermodal equipment. The intent of this rulemaking is to ensure that intermodal equipment used to transport intermodal containers is safe and systematically maintained. Improved maintenance is expected to result in fewer out-of-service orders and highway breakdowns involving intermodal chassis and improved efficiency of the Nation's intermodal transportation system. To whatever extent inadequately maintained intermodal chassis are responsible for, or contribute to, crashes, this proposal would also help to ensure that commercial motor vehicle (CMV) operations are safer.