Liquidity Coverage Ratio Rule: Treatment of Certain Emergency Facilities (rule, 85 FR 26835, May 6, 2020)
Summary
An interim final rule from the Office of the Comptroller of the Currency, the Federal Reserve Board and the Federal Deposit Insurance Corporation (Docket ID OCC–2020–0019). It was published in the Federal Register on May 6, 2020 (Vol. 85, No. 88) and took effect that day, with comments due by June 5, 2020. It requires banking organizations to neutralize the effect, under the Liquidity Coverage Ratio (LCR) rule, of participating in the Money Market Mutual Fund Liquidity Facility (MMLF) and the Paycheck Protection Program Liquidity Facility (PPPLF), both set up under section 13(3) of the Federal Reserve Act. The LCR requires enough high-quality liquid assets (HQLA) to cover total net cash outflows over a 30-day stress period. The agencies reason that because the Reserve Bank advances are non-recourse, the bank is not exposed to credit or market risk from the collateral.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Cite this document
“Liquidity Coverage Ratio Rule: Treatment of Certain Emergency Facilities (rule, 85 FR 26835, May 6, 2020).”
Original at www.govinfo.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/liquidity-coverage-ratio-rule-treatment-of-certain-emergency-facilitie-098a296a8c/
, SHA-256 3a245ee492a49801afb627ee0127c78da0b5e5ffeb69753b692cff8ca37172f7.Full text
26835
Rules and Regulations Federal Register
Vol. 85, No. 88
Wednesday, May 6, 2020
This section of the FEDERAL REGISTER Deposit Insurance Corporation (together, • Hand Delivery/Courier: 400 7th
contains regulatory documents having general the agencies) are adopting this interim Street SW, suite 3E–218, Washington,
applicability and legal effect, most of which final rule to require banking DC 20219.
are keyed to and codified in the Code of organizations to neutralize the effect • Fax: (571) 465–4326.
Federal Regulations, which is published under under the LCR rule of participating in Instructions: You must include
50 titles pursuant to 44 U.S.C. 1510.
the MMLF and the PPPLF. ‘‘OCC’’ as the agency name and ‘‘Docket
The Code of Federal Regulations is sold by DATES: The interim final rule is effective ID OCC–2020–0019’’ in your comment.
the Superintendent of Documents. May 6, 2020. Comments on the interim In general, the OCC will enter all
final rule must be received no later than comments received into the docket and
June 5, 2020. publish the comments on the
DEPARTMENT OF THE TREASURY Regulations.gov website without
ADDRESSES:
OCC: Commenters are encouraged to change, including any business or
Office of the Comptroller of the personal information provided such as
Currency submit comments through the Federal
eRulemaking Portal or email, if possible. name and address information, email
Please use the title ‘‘Liquidity Coverage addresses, or phone numbers.
12 CFR Part 50 Comments received, including
Ratio Rule: Treatment of Emergency
[Docket No. OCC–2020–0019] FRB Secured Lending Facilities’’ to attachments and other supporting
facilitate the organization and materials, are part of the public record
RIN 1557–AE92
distribution of the comments. You may and subject to public disclosure. Do not
FEDERAL RESERVE SYSTEM submit comments by any of the include any information in your
following methods: comment or supporting materials that
12 CFR Part 249 • Federal eRulemaking Portal— you consider confidential or
Regulations.gov Classic or inappropriate for public disclosure.
[Regulations WW; Docket No. R–1717] Regulations.gov Beta: Regulations.gov You may review comments and other
RIN 7100–AF90 Classic: Go to https:// related materials that pertain to this
www.regulations.gov/. Enter ‘‘Docket ID rulemaking action by any of the
FEDERAL DEPOSIT INSURANCE OCC–2020–0019’’ in the Search Box and following methods:
CORPORATION click ‘‘Search.’’ Click on ‘‘Comment • Viewing Comments Electronically—
Now’’ to submit public comments. For Regulations.gov Classic or
12 CFR Part 329 help with submitting effective Regulations.gov Beta: Regulations.gov
comments please click on ‘‘View Classic: Go to https://
RIN 3064–AF51 www.regulations.gov/. Enter ‘‘Docket ID
Commenter’s Checklist.’’ Click on the
‘‘Help’’ tab on the Regulations.gov home OCC–2020–0019’’ in the Search box and
Liquidity Coverage Ratio Rule:
page to get information on using click ‘‘Search.’’ Click on ‘‘Open Docket
Treatment of Certain Emergency
Regulations.gov, including instructions Folder’’ on the right side of the screen.
Facilities
for submitting public comments. Comments and supporting materials can
AGENCY: Office of the Comptroller of the Regulations.gov Beta: Go to https:// be viewed and filtered by clicking on
Currency (OCC), Board of Governors of beta.regulations.gov/ or click ‘‘Visit ‘‘View all documents and comments in
the Federal Reserve System (Board), and New Regulations.gov Site’’ from the this docket’’ and then using the filtering
Federal Deposit Insurance Corporation Regulations.gov Classic homepage. tools on the left side of the screen. Click
(FDIC). Enter ‘‘Docket ID OCC–2020–0019’’ in on the ‘‘Help’’ tab on the
ACTION: Interim final rule; request for the Search Box and click ‘‘Search.’’ Regulations.gov home page to get
comment. Public comments can be submitted via information on using Regulations.gov.
the ‘‘Comment’’ box below the The docket may be viewed after the
SUMMARY: To provide liquidity to the displayed document information or by close of the comment period in the same
money market sector, small business clicking on the document title and then manner as during the comment period.
lenders, and the broader credit markets clicking the ‘‘Comment’’ box on the top- Regulations.gov Beta: Go to https://
in order to stabilize the financial left side of the screen. For help with beta.regulations.gov/ or click ‘‘Visit
system, the Board of Governors of the submitting effective comments please New Regulations.gov Site’’ from the
Federal Reserve System (Board) click on ‘‘Commenter’s Checklist.’’ For Regulations.gov Classic homepage.
authorized the establishment of the assistance with the Regulations.gov Beta Enter ‘‘Docket ID OCC–2020–0019’’ in
Money Market Mutual Fund Liquidity site, please call (877) 378–5457 (toll the Search Box and click ‘‘Search.’’
Facility (MMLF) and the Paycheck free) or (703) 454–9859 Monday–Friday, Click on the ‘‘Comments’’ tab.
Protection Program Liquidity Facility 9 a.m.–5 p.m. ET or email regulations@ Comments can be viewed and filtered
(PPPLF), pursuant to section 13(3) of the erulemakinghelpdesk.com. by clicking on the ‘‘Sort By’’ drop-down
Federal Reserve Act. To facilitate use of • Email: regs.comments@ on the right side of the screen or the
these Federal Reserve facilities, and to occ.treas.gov. ‘‘Refine Results’’ options on the left side
ensure that the effects of their use are • Mail: Chief Counsel’s Office, of the screen. Supporting materials can
consistent and predictable under the Attention: Comment Processing, Office be viewed by clicking on the
Liquidity Coverage Ratio (LCR) rule, the of the Comptroller of the Currency, 400 ‘‘Documents’’ tab and filtered by
Office of the Comptroller of the 7th Street SW, suite 3E–218, clicking on the ‘‘Sort By’’ drop-down on
Currency, the Board, and the Federal Washington, DC 20219. the right side of the screen or the
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
26836 Federal Register / Vol. 85, No. 88 / Wednesday, May 6, 2020 / Rules and Regulations
‘‘Refine Results’’ options on the left side (202) 649–6360; or Henry Barkhausen, F. Use of Plain Language
of the screen.’’ For assistance with the Counsel, or Daniel Perez, Senior G. OCC Unfunded Mandates Reform Act of
Regulations.gov Beta site, please call Attorney, Chief Counsel’s Office, (202) 1995 Determination
(877) 378–5457 (toll free) or (703) 454– 649–5490, for persons who are deaf or I. Background
9859 Monday–Friday, 9 a.m.–5 p.m. ET hearing impaired, TTY, (202) 649–5597,
The containment measures adopted in
or email regulations@ Office of the Comptroller of the
response to the public health concerns
erulemakinghelpdesk.com. Currency, 400 7th Street SW, have slowed economic activity in many
The docket may be viewed after the Washington, DC 20219. countries, including the United States.
close of the comment period in the same Board: Anna Lee Hewko, Associate
Financial conditions have tightened
manner as during the comment period. Director, (202) 530–6360, Constance
markedly, sudden disruptions in
Board: You may submit comments, Horsley, Deputy Associate Director, financial markets have put increasing
identified by Docket No. R–1717; RIN (202) 452–5239, Kathryn Ballintine, liquidity pressure on money market
7100–AF90, by any of the following Manager, (202) 452–2555, Kevin Littler, mutual funds, and the cost of credit has
methods: Lead Financial Institution Policy risen for most borrowers. Given these
• Agency website: http:// Analyst, (202) 475–6677, Cecily Boggs, liquidity pressures, money market
www.federalreserve.gov. Follow the Senior Financial Institution Policy mutual funds have been faced with
instructions for submitting comments at Analyst II, (202) 530–6209, Michael redemption requests from clients with
http://www.federalreserve.gov/ Ofori-Kuragu, Senior Financial immediate cash needs and may need to
generalinfo/foia/ProposedRegs.cfm. Institution Policy Analyst II, (202) 475– sell a significant number of assets to
• Email: regs.comments@ 6623, or Christopher Powell, Senior meet such requests, which could further
federalreserve.gov. Include docket and Financial Institution Policy Analyst II, increase market pressures. Small
RIN numbers in the subject line of the (202) 452–3442, Division of Supervision businesses also are facing severe
message. and Regulation; Benjamin McDonough, liquidity constraints, as millions of
• Fax: (202) 452–3819 or (202) 452– Assistant General Counsel, (202) 452– Americans have been ordered to stay
3102. 2036, Steve Bowne, Senior Counsel, home, severely reducing their ability to
• Mail: Ann E. Misback, Secretary, (202) 452–3900, Jason Shafer, Senior engage in normal commerce, and
Board of Governors of the Federal Counsel, (202) 728–5811, Laura Bain, revenue streams for many small
Reserve System, 20th Street and Counsel, (202) 736–5546, or Jeffery businesses have collapsed. This has
Constitution Avenue NW, Washington, Zhang, Attorney, (202) 736–1968, Legal forced many small businesses to close
DC 20551. Division, Board of Governors of the temporarily or furlough employees.
All public comments will be made Federal Reserve System, 20th Street and Continued access to financing will be
available on the Board’s website at Constitution Avenue NW, Washington, crucial for small businesses to weather
http://www.federalreserve.gov/ DC 20551. Users of Telecommunication economic disruptions caused by the
generalinfo/foia/ProposedRegs.cfm as Device for Deaf (TDD) only, call (202) containment measures adopted in
submitted, unless modified for technical 263–4869. response to the public health concerns
reasons or to remove personally FDIC: Bobby R. Bean, Associate and, ultimately, to help restore
identifiable information at the Director, bbean@fdic.gov; Irina Leonova, economic activity.
commenter’s request. Accordingly, Acting Chief, Capital Markets Strategies In order to prevent the disruption in
comments will not be edited to remove Section, ileonova@FDIC.gov; Eric the money markets from destabilizing
any identifying or contact information. Schatten, Senior Policy Analyst, the financial system, the Board of
For security reasons, the Board requires eschatten@fdic.gov; Andrew Governors of the Federal Reserve
that visitors make an appointment to Carayiannis, Senior Policy Analyst, System (Board), with the approval of the
inspect comments. You may do so by acarayiannis@fdic.gov; capitalmarkets@ Secretary of the Treasury, authorized
calling (202) 452–3684. fdic.gov; Capital Markets Branch, the Federal Reserve Bank of Boston to
FDIC: You may submit comments, Division of Risk Management establish the Money Market Mutual
identified by RIN 3064–AF51, by any of Supervision, (202) 898–6888; or Fund Liquidity Facility (MMLF),
the following methods: Suzanne Dawley, Counsel, sudawley@ pursuant to section 13(3) of the Federal
• Agency website: https:// fdic.gov; Gregory Feder, Counsel, Reserve Act.1 Under the MMLF, the
www.fdic.gov/regulations/laws/federal. gfeder@fdic.gov; Andrew B. Williams II, Federal Reserve Bank of Boston extends
Follow instructions for submitting Counsel, andwilliams@fdic.gov; non-recourse loans to eligible borrowers
comments on the Agency website. Supervision and Legislation Branch, to purchase assets from money market
• Email: Comments@FDIC.gov. Legal Division, Federal Deposit mutual funds (MMFs). Assets purchased
Include ‘‘RIN 3064–AF51’’ on the Insurance Corporation, 550 17th Street from MMFs are posted as collateral to
subject line of the message. NW, Washington, DC 20429. For the the Federal Reserve Bank of Boston
• Mail: Robert E. Feldman, Executive hearing impaired only, (MMLF collateral). Eligible borrowers
Secretary, Attention: Comments/RIN Telecommunication Device for the Deaf under the MMLF include certain
3064–AF51, Federal Deposit Insurance (TDD), (800) 925–4618. banking organizations subject to the
Corporation, 550 17th Street NW, SUPPLEMENTARY INFORMATION: Liquidity Coverage Ratio (LCR) rule
Washington, DC 20429. (covered companies) issued by the
• Hand Delivered/Courier: Comments Table of Contents Office of the Comptroller of the
may be hand-delivered to the guard I. Background Currency (OCC), the Board, and the
station at the rear of the 550 17th Street II. The Interim Final Rule Federal Deposit Insurance Corporation
NW, building (located on F Street) on III. Administrative Law Matters (FDIC) (together, the agencies).2 MMLF
business days between 7:00 a.m. and A. Administrative Procedure Act collateral generally comprises securities
5:00 p.m. B. Congressional Review Act
C. Paperwork Reduction Act 1 12 U.S.C. 343(3).
FOR FURTHER INFORMATION CONTACT: D. Regulatory Flexibility Act 2 The applicability of the LCR rule is described in
OCC: James Weinberger, Technical E. Riegle Community Development and § __.1 of the rule. See 12 CFR 50.1 (OCC); 12 CFR
Expert, Treasury & Market Risk Policy, Regulatory Improvement Act of 1994 249.1 (Board); and 12 CFR 329.1 (FDIC).
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
Federal Register / Vol. 85, No. 88 / Wednesday, May 6, 2020 / Rules and Regulations 26837
and other assets with the same maturity II. The Interim Final Rule Under the terms of the MMLF and
date as the MMLF non-recourse loan. PPPLF, covered companies use the
A. LCR Treatment of MMLF and PPPLF
In order to provide liquidity to small value of cash received from posted or
Funding
business lenders and the broader credit pledged assets to repay the MMLF or
The agencies’ LCR rule requires PPPLF loan, respectively, and in no case
markets, and to help stabilize the
covered companies to calculate and is the maturity of the collateral shorter
financial system, the Board, with the maintain an amount of high-quality than the maturity of the advance. In
approval of the Secretary of the liquid assets (HQLA) sufficient to cover addition, because the advance from the
Treasury, authorized each of the Federal their total net cash outflows over a 30- Federal Reserve Bank is non-recourse,
Reserve Banks to extend credit under day stress period. A covered company’s the banking organization is not exposed
the Paycheck Protection Program LCR is the ratio of its HQLA amount to credit or market risk from the
Liquidity Facility (PPPLF), pursuant to (LCR numerator) divided by its total net collateral securing the MMLF or PPPLF
section 13(3) of the Federal Reserve cash outflows (LCR denominator). The loan that could otherwise affect the
Act.3 Under the PPPLF, each of the total net cash outflow amount is banking organization’s ability to settle
Federal Reserve Banks extends non- calculated as the difference between the loan. For these reasons, the agencies
recourse loans to institutions that are outflow and inflow amounts, which are believe that it is appropriate to provide
eligible to make Paycheck Protection determined by applying a standardized predictable and consistent treatment for
Program (PPP) covered loans,4 including set of outflow and inflow rates to the participation in the MMLF and PPPLF
depository institutions subject to the cash flows of various assets and by neutralizing the effects of
agencies’ LCR rule. Under the PPPLF, liabilities, together with off-balance participation in the MMLF and the
only PPP covered loans that are sheet items, as specified in §§ __.32 and PPPLF on covered companies’ LCRs.
guaranteed by the SBA under the PPP __.33 of the LCR rule.6 Absent this interim final rule, the
with respect to both principal and Absent the interim final rule, under agencies believe that the treatment of
interest and that are originated by an the LCR rule, covered companies would covered companies’ transactions with
eligible institution may be pledged as be required to recognize outflows for the MMLF and PPPLF under the LCR
collateral to the Federal Reserve Banks MMLF and PPPLF loans with a rule would not be consistent across
(PPPLF collateral). The maturity date of remaining maturity of 30 days or less transactions or facilities and would not
the extension of credit under the PPPLF and inflows for certain assets securing accurately reflect the liquidity risk
the MMLF and PPPLF loans. As a result, associated with funding exposures
equals the maturity date of the PPP
a covered company’s participation in through these facilities.
loans pledged to secure the extension of
the MMLF or PPPLF could affect its Specifically, the interim final rule
credit.5
total net cash outflows, which could adds a new definition to § __.3 and a
To facilitate the use of the MMLF and potentially result in an inconsistent, new § __.34 to the LCR rule. In § __.3,
PPPLF, the agencies are adopting this unpredictable, and more volatile the new definition ‘‘Covered Federal
interim final rule, which requires calculation of LCR requirements across Reserve Facility Funding’’ means a non-
covered companies to neutralize the covered companies. recourse loan that is extended as part of
LCR effects of the advances made by Under the LCR rule, secured loans the Money Market Mutual Fund
each facility and the exposures securing from a Federal Reserve facility with a Liquidity Facility or Paycheck
such facility advances. remaining maturity of 30 calendar days Protection Program Liquidity Facility
or less are categorized as secured authorized by the Board of Governors of
funding transactions with a sovereign the Federal Reserve System pursuant to
3 12 U.S.C. 343(3).
entity and assigned an outflow rate that section 13(3) of the Federal Reserve Act.
4 Congress created the PPP as part of the
varies based on the collateral securing The new § __.34 requires Covered
Coronavirus Aid, Relief, and Economic Security Act
(CARES Act) and in recognition of the exigent
the loan.7 In addition, the LCR rule Federal Reserve Facility Funding and
circumstances faced by small businesses. PPP assigns inflow rates to collateral the assets securing such funding to be
covered loans are fully guaranteed as to principal generally based on the asset and excluded from the calculation of a
and accrued interest by the Small Business counterparty type.8 As a result of the covered company’s total net cash
Administration (SBA) and also afford borrower applicable inflow and outflow rates in outflow amount as calculated under
forgiveness up to the principal amount of the PPP the LCR rule, MMLF and PPPLF
covered loan, if the proceeds of the PPP covered
§ __.30 of the LCR rule, notwithstanding
transactions could receive a non-neutral any other section of the LCR rule.
loan are used for certain expenses. Under the PPP,
liquidity risk treatment. Moreover, after Except as described below, this new
eligible borrowers generally include businesses
with fewer than 500 employees or that are these loans are extended and upon their section excludes advances made by a
otherwise considered to be small by the SBA. The maturity, the associated inflows and Federal Reserve Bank under the MMLF
SBA reimburses PPP lenders for any amount of a outflows could unnecessarily contribute or the PPPLF from being assigned an
PPP covered loan that is forgiven. PPP lenders are to volatility in LCRs. outflow rate under § __.32 of the LCR
not held liable for any representations made by PPP
6 Section __.30 of the LCR rule also requires a
rule, and any collateral securing such an
borrowers in connection with a borrower’s request
for PPP covered loan forgiveness. For more covered company, as applicable, to include in its
advance from being assigned an inflow
information on the Paycheck Protection Program, total net cash outflow amount a maturity mismatch rate under § __.33 of the LCR rule. While
see https://www.sba.gov/funding-programs/loans/ add-on, which is calculated as the difference (if this treatment would neutralize the
coronavirus-relief-options/paycheck-protection- greater than zero) between the covered company’s effect of the use of the facilities on a
largest net cumulative maturity outflow amount for
program-ppp.
any of the 30 calendar days following the
covered company’s LCR for the duration
5 The maturity date of the PPPLF’s loan will be
calculation date and the net day 30 cumulative of the facility, banking organizations
accelerated if the underlying PPP loan goes into maturity outflow amount. See 12 CFR 50.30 (OCC); should be mindful of the need, where
default and the eligible borrower sells the PPP Loan 12 CFR 249.30 (Board); and 12 CFR 329.30 (FDIC). applicable, to replace maturing Covered
to the Small Business Administration (SBA) to 7 See 12 CFR 50.32(j)(1)(i)–(iii) (OCC); 12 CFR
realize the SBA guarantee. The maturity date of the
Federal Reserve Facility Funding with
249.32(j)(1)(i)–(iii) (Board); and 12 CFR
PPPLF’s loan also will be accelerated to the extent 329.32(j)(1)(i)–(iii) (FDIC). appropriate alternative sources in
of any PPP loan forgiveness reimbursement 8 See 12 CFR 50.33 (OCC); 12 CFR 249.33 (Board); instances where exposures mature later
received by the eligible borrower from the SBA. and 12 CFR 329.33 (FDIC). than such funding.
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
26838 Federal Register / Vol. 85, No. 88 / Wednesday, May 6, 2020 / Rules and Regulations
This new § __.34 does not apply to the notice and the opportunity for public banking organizations may be restricted
extent the covered company secures comment are not required with respect in their ability to use the MMLF and
Covered Federal Reserve Facility to a rulemaking when an ‘‘agency for PPPLF due to potential effects on their
Funding with securities, debt good cause finds (and incorporates the LCRs. The urgent funding pressures
obligations, or other instruments issued finding and a brief statement of reasons facing small businesses and MMFs
by the covered company or its therefor in the rules issued) that notice justify the adoption of this interim final
consolidated entity. When a covered and public procedure thereon are rule as quickly as possible. For these
company owns an instrument that it or impracticable, unnecessary, or contrary reasons, the agencies find that there is
its consolidated entity issued, the to the public interest.’’ 11 good cause consistent with the public
covered company will not record a The agencies believe that the public interest to issue the interim final rule
payment upon the instrument’s interest is best served by implementing without advance notice and comment.12
maturity. The covered company would the interim final rule immediately upon The APA also requires a 30-day
not receive a payment from outside the publication in the Federal Register. As delayed effective date, except for (1)
consolidated covered company upon discussed above, the containment substantive rules that grant or recognize
maturity or settlement of the collateral measures adopted in response to the an exemption or relieve a restriction; (2)
that would be available to repay the public health concerns have slowed interpretative rules and statements of
borrowing (Covered Federal Reserve economic activity in many countries, policy; or (3) as otherwise provided by
Facility Funding), and, as a result, this including the United States. In the agency for good cause.13 For the
arrangement presents liquidity risk due particular, these containment measures good cause described above, the interim
to the asymmetric cash flows of the have acutely affected small businesses, final rule is exempt from the APA’s
covered company because the covered MMFs, and financial markets generally. delayed effective date requirement.14
company would not have an inflow to Significantly tighter financial While the agencies believe that there
offset its cash outflows.9 It would, conditions and the increased cost of is good cause to issue the interim final
therefore, be inappropriate to neutralize credit for most borrowers have severely rule without advance notice and
the impact of such a funding transaction affected small businesses. As millions of comment and with an immediate
under the LCR rule. The agencies seek Americans have been ordered to stay effective date, the agencies are
comment on this provision and all home, severely reducing their ability to interested in the views of the public and
aspects of the interim final rule. engage in normal commerce, revenue request comment on all aspects of the
Question 1: The agencies invite streams for many small businesses have interim final rule.
comment on the advantages and collapsed. This has resulted in severe
liquidity constraints at small businesses B. Congressional Review Act
disadvantages of neutralizing the effects
of participating in the MMLF and PPPLF and has forced many small businesses to For purposes of Congressional Review
close temporarily or furlough Act (CRA), the Office of Management
in the LCR rule.
employees. Continued access to and Budget (OMB) makes a
Question 2: How well does the
financing will be crucial for small determination as to whether a final rule
approach in the interim final rule
businesses to weather economic constitutes a ‘‘major’’ rule.15 If a rule is
support the objectives of the facilities?
disruptions caused by the containment deemed a ‘‘major rule’’ by the OMB, the
Question 3: What are the advantages
measures adopted in response to the CRA generally provides that the rule
and disadvantages of extending this
public health concerns and, ultimately, may not take effect until at least 60 days
treatment to any other facilities created
to help restore economic activity. following its publication.16
pursuant to section 13(3) of the Federal Additionally, sudden disruptions in
Reserve Act in which covered company The CRA defines a ‘‘major rule’’ as
financial markets have put increasing any rule that the Administrator of the
exposures are pledged as collateral for liquidity pressure on MMFs. Given
non-recourse, maturity-matched Office of Information and Regulatory
these pressures, MMFs have been faced Affairs of the OMB finds has resulted in
advances? with increased redemption requests
Question 4: What are the advantages or is likely to result in (1) an annual
from clients with immediate cash needs. effect on the economy of $100,000,000
and disadvantages of excluding from The MMFs may need to sell a significant
this treatment Covered Federal Reserve or more; (2) a major increase in costs or
number of assets to meet these
Facility Funding that is secured by prices for consumers, individual
redemption requests, which could
instruments issued by a covered industries, Federal, State, or local
further increase market pressures.
company or any of its consolidated government agencies or geographic
In order to provide liquidity to
entities? regions; or (3) significant adverse effects
banking organizations that lend to small
on competition, employment,
III. Administrative Law Matters business and the broader credit markets,
investment, productivity, innovation, or
and to prevent the disruption in the
A. Administrative Procedure Act on the ability of United States-based
money markets from destabilizing the
enterprises to compete with foreign-
The agencies are issuing the interim financial system, the Board, with
based enterprises in domestic and
final rule without prior notice and the approval of the Secretary of the
export markets.17
opportunity for public comment and the Treasury, authorized each of the Federal
For the same reasons set forth above,
delayed effective date ordinarily Reserve Banks to extend credit under
the agencies are adopting the interim
prescribed by the Administrative the PPPLF and the Federal Reserve Bank
final rule without the delayed effective
Procedure Act (APA).10 Pursuant to of Boston to establish the MMLF. This
date generally prescribed under the
section 553(b)(B) of the APA, general interim final rule will provide certainty
CRA. The delayed effective date
to covered companies regarding the
9 The covered company would not record a liquidity treatment of inflows and 12 5 U.S.C. 553(b)(B).
payment to itself in the amount owed for the outflows related to these Federal 13 5 U.S.C. 553(d).
instrument issued by the covered company or its
consolidated entity; this would be eliminated in the
Reserve lending programs. In the 14 5 U.S.C. 553(d)(1).
process of consolidating the covered company’s absence of this interim final rule, 15 5 U.S.C. 801 et seq.
financial statements. 16 5 U.S.C. 801(a)(3).
10 5 U.S.C. 553. 11 5 U.S.C. 553(b)(B). 17 5 U.S.C. 804(2).
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
Federal Register / Vol. 85, No. 88 / Wednesday, May 6, 2020 / Rules and Regulations 26839
required by the CRA does not apply to being reviewed under authority management area and provide timely
any rule for which an agency for good delegated by the OMB under the PRA. information on firm-specific liquidity
cause finds (and incorporates the Comments are invited on the following: risks during periods of stress. Analyses
finding and a brief statement of reasons a. Whether the collection of of systemic and idiosyncratic liquidity
therefor in the rule issued) that notice information in the interim final rule is risk issues are then used to inform the
and public procedure thereon are necessary for the proper performance of Board’s supervisory processes,
impracticable, unnecessary, or contrary the Board’s functions, including including the preparation of analytical
to the public interest.18 In light of whether the information has practical reports that detail funding
current market uncertainty, the agencies utility; vulnerabilities.
believe that delaying the effective date b. The accuracy of the Board’s Legal authorization and
of the rule would be contrary to the estimate of the burden of the proposed confidentiality: The FR 2052a is
public interest. information collection in the interim authorized pursuant to section 5 of the
As required by the CRA, the agencies final rule, including the validity of the Bank Holding Company Act (12 U.S.C.
will submit the interim final rule and methodology and assumptions used; 1844), section 8 of the International
other appropriate reports to Congress c. Ways to enhance the quality, Banking Act (12 U.S.C. 3106), section
and the Government Accountability utility, and clarity of the information to 165 of the Dodd-Frank Wall Street
Office for review. be collected; Reform and Consumer Protection Act
d. Ways to minimize the burden of (Dodd-Frank Act) (12 U.S.C. 5365), and
C. Paperwork Reduction Act
information collection on respondents, section 10 of the Home Owners’ Loan
The Paperwork Reduction Act of 1995 including through the use of automated Act (12 U.S.C. 1467(a)) and is
(PRA) states that no agency may collection techniques or other forms of mandatory. Section 5(c) of the Bank
conduct or sponsor, nor is the information technology; and Holding Company Act authorizes the
respondent required to respond to, an e. Estimates of capital or startup costs Board to require BHCs to submit reports
information collection unless it displays and costs of operation, maintenance, to the Board regarding their financial
a currently valid OMB control and purchase of services to provide condition. Section 8(a) of the
number.19 This interim final rule does information. International Banking Act subjects FBOs
not introduce any new information Comments must be submitted on or to the provisions of the Bank Holding
collections or revise any existing before July 6, 2020. At the end of the Company Act. Section 165 of the Dodd-
information collections pursuant to the comment period, the comments and Frank Act requires the Board to
PRA for the OCC or the FDIC. Therefore, recommendations received will be establish prudential standards for
no submissions will be made by the analyzed to determine the extent to certain BHCs and FBOs, which include
OCC or the FDIC to OMB for review. which the Board should modify the liquidity requirements. Section 10(g) of
The interim final rule does, however, information collection. the Home Owners’ Loan Act authorizes
affect the Board’s current information the Board to collect reports from SLHCs.
collection for the Complex Institution Approval Under OMB Delegated Financial institution information
Liquidity Monitoring Report (FR 2052a; Authority of the Temporary Revision of, required by the FR 2052a is collected as
OMB No. 7100–0361). The Board has and Proposal To Extend for Three Years, part of the Board’s supervisory process.
reviewed the interim final rule pursuant With Revision, the Following Therefore, such information is entitled
to authority delegated by OMB. Information Collection to confidential treatment under
The Board has temporarily revised the Report title: Complex Institution Exemption 8 of the Freedom of
reporting form and instructions for the Liquidity Monitoring Report. Information Act (FOIA) (5 U.S.C.
FR 2052a to reflect the changes made in Agency form number: FR 2052a. 552(b)(8)). In addition, the institution
this interim final rule. On June 15, 1984, OMB control number: 7100–0361. information provided by each
OMB delegated to the Board authority Effective date: May 6, 2020. respondent would not be otherwise
under the PRA to approve a temporary Frequency: Monthly, and each available to the public and its disclosure
revision to a collection of information business day (daily). could cause substantial competitive
without providing opportunity for Affected public: Businesses or other harm. Accordingly, it is entitled to
public comment if the Board determines for-profit. confidential treatment under the
that a change in an existing collection Respondents: U.S. bank holding authority of exemption 4 of the FOIA (5
must be instituted quickly and that companies (BHCs), U.S. savings and U.S.C. 552(b)(4)), which protects from
public participation in the approval loan holding companies (SLHCs), and disclosure trade secrets and commercial
process would defeat the purpose of the foreign banking organizations (FBOs) or financial information.
collection or substantially interfere with with U.S. assets. Current actions: The Board has
the Board’s ability to perform its Estimated number of respondents: temporarily revised the reporting form
statutory obligation. Monthly, 26; daily, 16. and instructions of the FR 2052a to
The Board’s delegated authority Estimated average hours per response: incorporate the interim final rule.
requires that the Board, after Monthly, 120; daily, 220. Specifically, the Board has added: (1)
temporarily approving a collection, Estimated annual burden hours: The sub-product value of ‘‘Covered
solicit public comment on a proposal to 917,440. Federal Reserve Facility Funding’’ to the
extend the temporary collection for a General description of report: The product O.S.6: Exceptional Central Bank
period not to exceed three years. Board uses the FR 2052a to monitor the Operations and a corresponding
Therefore, the Board is inviting overall liquidity profile of supervised instruction to exclude balances reported
comment on a proposal to extend the FR institutions. These data provide detailed under this sub-product from the pre-
2052a for three years, with such information on the liquidity risks within existing sub-product of ‘‘Federal
revisions. The Board invites public different business lines (e.g., financing Reserve Bank’’; (2) a sentence to the
comment on the FR 2052a, which is of securities positions, prime brokerage ‘‘General Guidance’’ paragraphs under
activities). In particular, these data serve the I.U: Inflows-Unsecured and I.S:
18 5 U.S.C. 808. as part of the Board’s supervisory Inflows-Secured headings: ‘‘Exclude
19 4 U.S.C. 3501–3521. surveillance program in its liquidity risk assets that secure Covered Federal
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
26840 Federal Register / Vol. 85, No. 88 / Wednesday, May 6, 2020 / Rules and Regulations
Reserve Facility Funding’’; (3) a E. Riegle Community Development and paragraphing) make the regulation
sentence to the definition of product Regulatory Improvement Act of 1994 easier to understand? If so, what
I.O.6: Interest and Dividends Pursuant to section 302(a) of the changes to the format would make the
Receivable: ‘‘Exclude interest and Riegle Community Development and regulation easier to understand? What
dividends receivable on assets securing Regulatory Improvement Act else could we do to make the regulation
Covered Federal Reserve Facility (RCDRIA),22 in determining the effective easier to understand?
Funding’’; (4) a sentence to the date and administrative compliance G. OCC Unfunded Mandates Reform Act
definition of product O.O.19: Interest requirements for new regulations that of 1995 Determination
and Dividends Payable: ‘‘Exclude impose additional reporting, disclosure,
interest payable on Covered Federal or other requirements on insured As a general matter, the Unfunded
Reserve Facility Funding’’; and (5) a depository institutions (IDIs), each Mandates Reform Act of 1995 (UMRA),
collateral class of ‘‘L–12’’ representing Federal banking agency must consider, 2 U.S.C. 1531 et seq., requires the
loans guaranteed by U.S. Government consistent with the principle of safety preparation of a budgetary impact
agencies. and soundness and the public interest, statement before promulgating a rule
any administrative burdens that such that includes a Federal mandate that
The Board has determined that these may result in the expenditure by State,
temporary revisions to the FR 2052a regulations would place on depository
institutions, including small depository local, and tribal governments, in the
must be instituted quickly and that aggregate, or by the private sector, of
institutions, and customers of
public participation in the approval $100 million or more in any one year.
depository institutions, as well as the
process would defeat the purpose of the However, the UMRA does not apply to
benefits of such regulations. In addition,
collection of information, as delaying final rules for which a general notice of
section 302(b) of the RCDRIA requires
the revisions would interfere with the new regulations and amendments to proposed rulemaking was not
Board’s ability to perform its statutory regulations that impose additional published.25 Therefore, because the
duties and would cause public harm if reporting, disclosures, or other new OCC has found good cause to dispense
firms were unable to take full advantage requirements on IDIs generally to take with notice and comment for the
of the emergency relief provided by the effect on the first day of a calendar interim final rule, the OCC has not
MMLF in response to significant quarter that begins on or after the date prepared an economic analysis of the
financial industry disruptions from the on which the regulations are published rule under the UMRA.
containment measures adopted in in final form, with certain exceptions,
response to the public health concerns. List of Subjects
including for good cause.23 For the
In addition, the Board proposes to reasons described above, the agencies 12 CFR Part 50
extend the FR 2052a for three years with find good cause exists under section 302 Administrative practice and
the revisions discussed above. of the RCDRIA to publish the interim procedure, Banks, Banking, Reporting
final rule with an immediate effective and recordkeeping requirements,
D. Regulatory Flexibility Act date. Savings associations.
As such, the interim final rule will be
The Regulatory Flexibility Act 12 CFR Part 249
effective immediately. Nevertheless, the
(RFA) 20 requires an agency to consider agencies seek comment on the RCDRIA.
whether the rules it proposes will have Administrative practice and
a significant economic impact on a F. Use of Plain Language procedure, Banks, Banking, Holding
substantial number of small entities.21 companies, Reporting and
Section 722 of the Gramm-Leach-
The RFA applies only to rules for which recordkeeping requirements.
Bliley Act 24 requires the Federal
an agency publishes a general notice of banking agencies to use plain language 12 CFR Part 329
proposed rulemaking pursuant to 5 in all proposed and final rules Administrative practice and
U.S.C. 553(b). As discussed previously, published after January 1, 2000. The procedure, Banks, Banking, Reporting
consistent with section 553(b)(B) of the agencies have sought to present the and recordkeeping requirements.
APA, the agencies have determined for interim final rule in a simple and
good cause that general notice and straightforward manner. The agencies DEPARTMENT OF THE TREASURY
opportunity for public comment is invite comments on whether there are Office of the Comptroller of the
unnecessary, and therefore the agencies additional steps it could take to make Currency
are not issuing a notice of proposed the rule easier to understand. For
rulemaking. Accordingly, the agencies example: 12 CFR Chapter I
have concluded that the RFA’s • Have we organized the material to Authority and Issuance
requirements relating to initial and final suit your needs? If not, how could this
material be better organized? For the reasons stated in the
regulatory flexibility analysis do not
• Are the requirements in the preamble, the Office of the Comptroller
apply.
regulation clearly stated? If not, how of the Currency amends part 50 of
Nevertheless, the agencies seek chapter I of title 12, Code of Federal
could the regulation be more clearly
comment on whether, and the extent to stated? Regulations as follows:
which, the interim final rule would • Does the regulation contain
have a significant economic impact on language or jargon that is not clear? If PART 50—LIQUIDITY RISK
a substantial number of small entities. so, which language requires MEASUREMENT STANDARDS
clarification? ■ 1. The authority citation for part 50
20 5 U.S.C. 601 et seq.
• Would a different format (grouping
21 Under regulations issued by the Small Business continues to read as follows:
and order of sections, use of headings,
Administration, a small entity includes a depository Authority: 12 U.S.C. 1 et seq., 93a, 481,
institution, bank holding company, or savings and 1818, 1828, and 1462 et seq.
22 12 U.S.C. 4802(a).
loan holding company with total assets of $600
23 12 U.S.C. 4802.
million or less and trust companies with total assets
of $41.5 million or less. See 13 CFR 121.201. 24 12 U.S.C. 4809. 25 See 2 U.S.C. 1532(a).
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
Federal Register / Vol. 85, No. 88 / Wednesday, May 6, 2020 / Rules and Regulations 26841
■ 2. Amend § 50.3 by adding the PART 249—LIQUIDITY RISK PART 329—LIQUIDITY RISK
definition of Covered Federal Reserve MEASUREMENT STANDARDS MEASUREMENT STANDARDS
Facility Funding, in alphabetical order, (REGULATION WW)
to read as follows: ■ 7. The authority citation for part 329
■ 4. The authority citation for part 249 continues to read as follows:
§ 50.3 Definitions. continues to read as follows: Authority: 12 U.S.C. 1815, 1816, 1818,
* * * * * Authority: 12 U.S.C. 248(a), 321–338a, 1819, 1828, 1831p–1, 5412.
481–486, 1467a(g)(1), 1818, 1828, 1831p–1, ■ 8. Amend § 329.3 by redesignating
Covered Federal Reserve Facility 1831o–1, 1844(b), 5365, 5366, 5368; 12
Funding means a non-recourse loan that U.S.C. 3101 et seq.
footnotes 1 and 2 as footnotes 2 and 3
is extended as part of the Money Market and adding the definition of Covered
■ 5. Amend § 249.3 by redesignating Federal Reserve Facility Funding, in
Mutual Fund Liquidity Facility or
footnotes 1 and 2 as footnotes 2 and 3 alphabetical order, to read as follows:
Paycheck Protection Program Liquidity and adding the definition of Covered
Facility authorized by the Board of Federal Reserve Facility Funding, in § 329.3 Definitions.
Governors of the Federal Reserve alphabetical order, to read as follows: * * * * *
System pursuant to section 13(3) of the Covered Federal Reserve Facility
Federal Reserve Act.1 § 249.3 Definitions. Funding means a non-recourse loan that
* * * * * * * * * * is extended as part of the Money Market
Covered Federal Reserve Facility Mutual Fund Liquidity Facility or
■ 3. Add § 50.34 to read as follows: Funding means a non-recourse loan that Paycheck Protection Program Liquidity
is extended as part of the Money Market Facility authorized by the Board of
§ 50.34 Cash flows related to Covered
Mutual Fund Liquidity Facility or Governors of the Federal Reserve
Federal Reserve Facility Funding.
Paycheck Protection Program Liquidity System pursuant to section 13(3) of the
(a) Treatment of Covered Federal Facility authorized by the Board Federal Reserve Act.1
Reserve Facility Funding. pursuant to section 13(3) of the Federal * * * * *
Notwithstanding any other section of Reserve Act.1
■ 9. Add § 329.34 to read as follows:
this part and except as provided in * * * * *
paragraph (b) of this section, outflow ■ 6. Add § 249.34 to read as follows: § 329.34 Cash flows related to Covered
amounts and inflow amounts related to Federal Reserve Facility Funding.
§ 249.34 Cash flows related to Covered (a) Treatment of Covered Federal
Covered Federal Reserve Facility
Federal Reserve Facility Funding. Reserve Facility Funding.
Funding and the assets securing
(a) Treatment of Covered Federal Notwithstanding any other section of
Covered Federal Reserve Facility
Reserve Facility Funding. this part and except as provided in
Funding are excluded from the Notwithstanding any other section of
calculation of a national bank’s or paragraph (b) of this section, outflow
this part and except as provided in amounts and inflow amounts related to
Federal savings association’s total net paragraph (b) of this section, outflow Covered Federal Reserve Facility
cash outflow amount calculated under amounts and inflow amounts related to Funding and the assets securing
§ 50.30. Covered Federal Reserve Facility Covered Federal Reserve Facility
(b) Exception. To the extent the Funding and the assets securing Funding are excluded from the
Covered Federal Reserve Facility Covered Federal Reserve Facility calculation of a FDIC-supervised
Funding is secured by securities, debt Funding are excluded from the institution’s total net cash outflow
obligations, or other instruments issued calculation of a Board-regulated amount calculated under § 329.30.
by the national bank or Federal savings institution’s total net cash outflow (b) Exception. To the extent the
association or one of its consolidated amount calculated under § 249.30. Covered Federal Reserve Facility
(b) Exception. To the extent the Funding is secured by securities, debt
subsidiaries, the Covered Federal
Covered Federal Reserve Facility obligations, or other instruments issued
Reserve Facility Funding is not subject
Funding is secured by securities, debt by the FDIC-supervised institution or
to paragraph (a) of this section and this
obligations, or other instruments issued one of its consolidated subsidiaries, the
outflow amount must be included in the by the Board-regulated institution or
national bank’s or Federal savings Covered Federal Reserve Facility
one of its consolidated subsidiaries, the Funding is not subject to paragraph (a)
association’s total net cash outflow Covered Federal Reserve Facility
amount calculated under § 50.30. of this section and this outflow amount
Funding is not subject to paragraph (a) must be included in the FDIC-
Board of Governors of the Federal of this section and this outflow amount supervised institution’s total net cash
Reserve System must be included in the Board-regulated outflow amount calculated under
institution’s total net cash outflow § 329.30.
12 CFR Chapter II amount calculated under § 249.30.
Brian P. Brooks,
Authority and Issuance Federal Deposit Insurance Corporation First Deputy Comptroller of the Currency.
For the reasons stated in the 12 CFR Chapter III By order of the Board of Governors of the
SUPPLEMENTARY INFORMATION, the Board Authority and Issuance Federal Reserve System.
of Governors of the Federal Reserve Ann Misback,
For the reasons set forth in the joint
System amends 12 CFR chapter II as preamble, chapter III of title 12 of the Secretary of the Board.
follows: Code of Federal Regulations is amended Federal Deposit Insurance Corporation.
as follows: By order of the Board of Directors.
1 The Money Market Mutual Fund Liquidity
1 The Money Market Mutual Fund Liquidity 1 The Money Market Mutual Fund Liquidity
Facility was authorized on March 18, 2020, and the Facility was authorized on March 18, 2020, and the Facility was authorized on March 18, 2020, and the
Paycheck Protection Program Liquidity Facility was Paycheck Protection Program Liquidity Facility was Paycheck Protection Program Liquidity Facility was
authorized on April 6, 2020. authorized on April 6, 2020. authorized on April 6, 2020.
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
26842 Federal Register / Vol. 85, No. 88 / Wednesday, May 6, 2020 / Rules and Regulations
Dated at Washington, DC, on or about April 2200 South 216th St., Des Moines, WA. Series 900) airplanes; and all
30, 2020. For information on the availability of Bombardier, Inc., Model CL–600–2C11
Robert E. Feldman, this material at the FAA, call 206–231– (Regional Jet Series 550) airplanes. The
Executive Secretary. 3195. It is also available on the internet NPRM published in the Federal
[FR Doc. 2020–09716 Filed 5–5–20; 8:45 am] at https://www.regulations.gov by Register on February 18, 2020 (85 FR
BILLING CODE 6210–01–P 4810–33–P; 6714–01–P searching for and locating Docket No. 8768). The NPRM was prompted by
FAA–2020–0092. reports of fractured rudder primary feel
unit shafts; a subsequent investigation
Examining the AD Docket
DEPARTMENT OF TRANSPORTATION determined that the fractures in the
You may examine the AD docket on shafts are consistent with fatigue
Federal Aviation Administration the internet at https:// damage. The NPRM proposed to require
www.regulations.gov by searching for replacement of the rudder primary feel
14 CFR Part 39 and locating Docket No. FAA–2020– unit shaft. The FAA is issuing this AD
0092; or in person at Docket Operations to address fractures of the rudder
[Docket No. FAA–2020–0092; Product between 9 a.m. and 5 p.m., Monday primary feel unit shaft, which could
Identifier 2020–NM–001–AD; Amendment through Friday, except Federal holidays. result in a loss of feel in the yaw axis
39–19905; AD 2020–08–13] The AD docket contains this final rule, and thereby impact the controllability of
RIN 2120–AA64 any comments received, and other the airplane. See the MCAI for
information. The address for Docket additional background information.
Airworthiness Directives; Bombardier, Operations is U.S. Department of
Transportation, Docket Operations, M– Comments
Inc. Airplanes
30, West Building Ground Floor, Room The FAA gave the public the
AGENCY: Federal Aviation W12–140, 1200 New Jersey Avenue SE, opportunity to participate in developing
Administration (FAA), Department of Washington, DC 20590. this final rule. The FAA has considered
Transportation (DOT). FOR FURTHER INFORMATION CONTACT: the comments received. The Air Line
ACTION: Final rule. Andrea Jimenez, Aerospace Engineer, Pilots Association, International (ALPA)
Airframe and Mechanical Systems and Jacob Yepiz stated support for the
SUMMARY: The FAA is adopting a new
Section, FAA, New York ACO Branch, NPRM.
airworthiness directive (AD) for certain
1600 Stewart Avenue, Suite 410,
Bombardier, Inc., Model CL–600–2B19 Conclusion
Westbury, NY 11590; telephone 516–
(Regional Jet Series 100 & 440) The FAA reviewed the relevant data,
228–7330; fax 516–794–5531; email 9-
airplanes, Model CL–600–2C10 considered the comments received, and
avs-nyaco-cos@faa.gov.
(Regional Jet Series 700, 701 & 702) determined that air safety and the
SUPPLEMENTARY INFORMATION:
airplanes, Model CL–600–2D15 public interest require adopting this
(Regional Jet Series 705) airplanes, and Discussion final rule as proposed, except for minor
Model CL–600–2D24 (Regional Jet editorial changes. The FAA has
Transport Canada Civil Aviation
Series 900) airplanes; and all determined that these minor changes:
(TCCA), which is the aviation authority
Bombardier, Inc., Model CL–600–2C11 • Are consistent with the intent that
for Canada, has issued Canadian AD
(Regional Jet Series 550) airplanes. This was proposed in the NPRM for
CF–2019–42, dated November 8, 2019
AD was prompted by reports of addressing the unsafe condition; and
(also referred to as the Mandatory
fractured rudder primary feel unit
Continuing Airworthiness Information, • Do not add any additional burden
shafts; a subsequent investigation
or ‘‘the MCAI’’), to correct an unsafe upon the public than was already
determined that the fractures in the
condition for certain Bombardier, Inc., proposed in the NPRM.
shafts are consistent with fatigue
Model CL–600–2B19 (Regional Jet
damage. This AD requires replacement Related Service Information Under 1
Series 100 & 440) airplanes, Model CL–
of the rudder primary feel unit shaft. CFR Part 51
600–2C10 (Regional Jet Series 700, 701
The FAA is issuing this AD to address Bombardier has issued Service
& 702) airplanes, Model CL–600–2D15
the unsafe condition on these products. Bulletin 601R–27–166, dated April 5,
(Regional Jet Series 705) airplanes, and
DATES: This AD is effective June 10, Model CL–600–2D24 (Regional Jet 2019; and Service Bulletin 670BA–27–
2020. Series 900) airplanes; and all 075, dated April 5, 2019. This service
The Director of the Federal Register Bombardier, Inc., Model CL–600–2C11 information describes procedures for
approved the incorporation by reference (Regional Jet Series 550) airplanes. You replacing the rudder primary feel unit
of certain publications listed in this AD may examine the MCAI in the AD shaft that has part number 600–90251–
as of June 10, 2020. docket on the internet at https:// 1 with a new shaft. These documents
ADDRESSES: For service information www.regulations.gov by searching for are distinct since they apply to different
identified in this final rule, contact and locating Docket No. FAA–2020– airplane models. This service
Bombardier, Inc., 400 Côte-Vertu Road 0092. information is reasonably available
West, Dorval, Québec H4S 1Y9, Canada; The FAA issued a notice of proposed because the interested parties have
Widebody Customer Response Center rulemaking (NPRM) to amend 14 CFR access to it through their normal course
North America toll-free telephone 1– part 39 by adding an AD that would of business or by the means identified
866–538–1247 or direct-dial telephone apply to certain Bombardier, Inc., Model in the ADDRESSES section.
1–514–855–2999; fax 514–855–7401; CL–600–2B19 (Regional Jet Series 100 &
email ac.yul@aero.bombardier.com; 440) airplanes, Model CL–600–2C10 Costs of Compliance
internet http://www.bombardier.com. (Regional Jet Series 700, 701 & 702) The FAA estimates that this AD
You may view this service information airplanes, Model CL–600–2D15 affects 1,002 airplanes of U.S. registry.
at the FAA, Airworthiness Products (Regional Jet Series 705) airplanes, and The FAA estimates the following costs
Section, Operational Safety Branch, Model CL–600–2D24 (Regional Jet to comply with this AD:
VerDate Sep<11>2014 16:33 May 05, 2020 Jkt 250001 PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 E:\FR\FM\06MYR1.SGM 06MYR1
File and source
- File
- FR-2020-05-06_2020-09716.pdf
- Size
- 264,451 bytes
- SHA-256
- 3a245ee492a49801afb627ee0127c78da0b5e5ffeb69753b692cff8ca37172f7
- Our copy
- FR-2020-05-06_2020-09716.pdf
- Original
- www.govinfo.gov