51792 Federal Register / Vol. 86, No. 178 / Friday, September 17, 2021 / Rules and Regulations 

St., Des Moines, WA. For information on the 

availability of this material at the FAA, call 

206–231–3195. 

(5) You may view this service information 

that is incorporated by reference at the 

National Archives and Records 

Administration (NARA). For information on 

the availability of this material at NARA, 

email fr.inspection@nara.gov, or go to: 

https://www.archives.gov/federal-register/cfr/ 

ibr-locations.html. 

Issued on August 25, 2021. 

Gaetano A. Sciortino, 

Deputy Director for Strategic Initiatives, 

Compliance & Airworthiness Division, 

Aircraft Certification Service. 

[FR Doc. 2021–20035 Filed 9–16–21; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2019–0919; Project 

Identifier 2019–NE–24–AD; Amendment 39– 

21714; AD 2021–18–13] 

RIN 2120–AA64 

Airworthiness Directives; General 

Electric Company Turbofan Engines 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final rule. 

SUMMARY: The FAA is adopting a new 

airworthiness directive (AD) for all 

General Electric Company (GE) CF34–8 

model turbofan engines with a certain 

outer shell combustion liner 

(combustion outer liner shell) installed. 

This AD was prompted by two in-flight 

engine shutdowns (IFSDs) that occurred 

as a result of failures of the combustion 

outer liner shell. This AD requires a 

borescope inspection (BSI) or visual 

inspection of the combustion outer liner 

shell and, depending on the results of 

the inspection, possible replacement of 

the combustion outer liner shell. The 

FAA is issuing this AD to address the 

unsafe condition on these products. 

DATES: This AD is effective October 22, 

2021. 

The Director of the Federal Register 

approved the incorporation by reference 

of certain publications listed in this AD 

as of October 22, 2021. 

ADDRESSES: For service information 

identified in this final rule, contact 

General Electric Company, GE Aviation, 

Room 285, 1 Neumann Way, Cincinnati, 

OH 45215; phone: (513) 552–3272; 

email: aviation.fleetsupport@ge.com. 

You may view this service information 

at the FAA, Airworthiness Products 

Section, Operational Safety Branch, 

1200 District Avenue, Burlington, MA 

01803. For information on the 

availability of this material at the FAA, 

call (781) 238–7759. It is also available 

at https://www.regulations.gov by 

searching for and locating Docket No. 

FAA–2019–0919. 

Examining the AD Docket 

You may examine the AD docket at 

https://www.regulations.gov by 

searching for and locating Docket No. 

FAA–2019–0919; or in person at Docket 

Operations between 9 a.m. and 5 p.m., 

Monday through Friday, except Federal 

holidays. The AD docket contains this 

final rule, any comments received, and 

other information. The address for 

Docket Operations is U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue SE, 

Washington, DC 20590. 

FOR FURTHER INFORMATION CONTACT: 

Scott Stevenson, Aviation Safety 

Engineer, ECO Branch, FAA, 1200 

District Avenue, Burlington, MA 01803; 

phone: (781) 238–7132; fax: (781) 238– 

7199; email: Scott.M.Stevenson@faa.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The FAA issued a notice of proposed 

rulemaking (NPRM) to amend 14 CFR 

part 39 by adding an AD that would 

apply to all CF34–8C1, CF34–8C5, 

CF34–8C5A1, CF34–8C5B1, CF34– 

8C5A2, CF34–8C5A3, CF34–8E2, CF34– 

8E2A1, CF34–8E5, CF34–8E5A1, CF34– 

8E5A2, CF34–8E6, and CF34–8E6A1 

model turbofan engines with a certain 

combustion outer liner shell installed. 

The NPRM published in the Federal 

Register on January 10, 2020 (85 FR 

1292). The NPRM was prompted by 

reports of two IFSDs on GE CF34–8C 

and –8E model turbofan engines. These 

IFSDs were due to the cracking and 

collapsing of the combustion outer liner 

shell, which resulted in thermal distress 

of the high-pressure turbine and lowpressure turbine (LPT) including burnthrough of the LPT case. In the NPRM, 

the FAA proposed to require a BSI or 

visual inspection of the combustion 

outer liner shell and, depending on the 

results of the inspection, possible 

replacement of the combustion outer 

liner shell. The FAA is issuing this AD 

to address the unsafe condition on these 

products. 

Discussion of Final Airworthiness 

Directive 

Comments 

The FAA received comments from 

four commenters. The commenters were 

Horizon Air, Japan Airlines, Endeavor 

Air, and the Air Line Pilots Association, 

International (ALPA). The following 

presents the comments received on the 

NPRM and the FAA’s response to each 

comment. 

Request To Change the Initial 

Compliance Time 

Horizon Air requested the FAA revise 

the initial inspection threshold in 

proposed paragraph (g)(2) of the NPRM 

to ‘‘17,499 flight hours (FHs) time since 

new (TSN) or time since repair (TSR), or 

12,000 flight cycles (FCs) TSN or TSR, 

whichever occurs later.’’ Horizon Air 

reasoned that the initial inspection 

threshold in paragraph (g)(2) of the 

proposed AD would unfairly penalize 

operators, like Horizon Air, with high 

FH to FC ratios. Horizon Air further 

stated that using the higher FH to FC 

ratios, the proposed 17,499 FHs TSN or 

TSR inspection threshold would equate 

to approximately 11,000 engine FCs. 

This FC value is substantially below the 

GE targeted initial engine shop visit 

threshold of 12,000 to 14,000 FCs and 

would potentially result in a significant 

increase in the number of engine shop 

visits over the 6- to 12-year operating 

lifespan of each engine. 

The FAA partially agrees. While the 

failure mode is partially related to FCs, 

the compliance is published in FHs to 

align with existing maintenance 

intervals. Incorporating both measures 

as intervals into this AD is impractical; 

however, operators may request an 

alternative method of compliance 

(AMOC) in accordance with the 

procedures specified in paragraph (k) of 

this AD to use alternate intervals. The 

FAA did not change this AD as a result 

of this comment. 

Request To Change the Installation 

Prohibition 

Horizon Air requested the FAA revise 

paragraph (h), Installation Prohibition, 

as proposed in the NPRM, so it does not 

conflict with the proposed required 

actions specified in paragraph (g)(1) of 

the NPRM. Horizon Air stated that 

paragraph (h) of the proposed AD 

prohibits installation of a combustion 

outer liner shell with greater than 

17,500 FHs TSN or TSR, without first 

inspecting it in accordance with 

paragraph (g)(1) of the proposed AD. 

However, paragraph (g)(1) of the 

proposed AD requires inspection of the 

combustion outer liner shell within 500 

engine FHs TSN or TSR for those 

combustion outer liner shells that have 

accumulated 17,500 FHs TSN or TSR. 

Horizon Air concluded that the 18,000 

FHs TSN or TSR limitation specified in 

paragraph (g)(1) of the proposed AD 

conflicts with the 17,500 FHs TSN or 

Federal Register / Vol. 86, No. 178 / Friday, September 17, 2021 / Rules and Regulations 51793 

TSR limit specified in paragraph (h) of 

the proposed AD. 

The FAA disagrees. The initial 

inspection threshold is 17,500 FHs for 

affected engines. This AD provides a 

grace period of 500 FHs for in-service 

engines to prevent the unintentional 

grounding of airplanes with affected 

engines. The FAA did not change this 

AD as a result of this comment. 

Request To Include a Terminating 

Action 

Horizon Air requested the FAA 

petition GE for a terminating action to 

the inspection requirements in the 

proposed AD. Horizon Air commented 

the financial cost and maintenance 

burden of performing the repetitive 

inspections are significant. 

The FAA disagrees. The FAA 

considers this AD to be interim action 

and will consider further rulemaking if 

the manufacturer develops a terminating 

action. The FAA included all estimated 

costs in the Costs of Compliance section 

in the preamble of this AD. The FAA 

did not change this AD as a result of this 

comment. 

Request To Revise Service Information 

References 

Horizon Air, Japan Airlines, and 

Endeavor Air requested the FAA update 

references to GE CF34–8E Alert Service 

Bulletin (SB) 72–A0221 and GE CF34– 

8C Alert SB 72–A0335 in the Required 

Actions section, paragraph (g), of the 

proposed AD. Japan Airlines requested 

that GE CF34–8E–AL S/B 72–A0221, 

Original Issue, dated June 27, 2019, be 

added to the compliance paragraphs 

because the Original Issue and R01 have 

the same inspection methods and limits. 

Horizon Air requested that the FAA 

reference only GE CF34–8E Alert SB 72– 

A0221 R01 in paragraph (g) of the 

proposed AD and add a Previous Credit 

section to allow previous compliance 

using the Original Issue. Endeavor Air 

requested that the FAA reference the 

latest revision of GE CF34–8C Alert SB 

72–A0335 in proposed paragraph (g). 

Endeavor Air indicated that GE planned 

to issue R02 of CF34–8C Alert SB 72– 

A0335 on February 24, 2020. 

The FAA agrees to reference the latest 

revision of these Alert SBs, which is 

R02 for both GE CF34–8C Alert SB 72– 

A0335 and GE CF34–8E Alert SB 72– 

A0221, in paragraph (g) of this AD. The 

FAA disagrees with the need to 

reference prior revisions of these Alert 

SBs in paragraphs (g) of this AD but 

agrees to add Credit for Previous 

Actions, paragraph (j), to this AD to 

allow credit for performing inspections 

prior to the effective date of this AD. 

These changes impose no additional 

burden on operators who are required to 

comply with this AD. 

Request To Clarify Compliance 

Japan Airlines requested that the FAA 

clarify whether the inspection should 

occur ‘‘before’’ or ‘‘within’’ 500 FHs 

after the effective date of this AD. Japan 

Airlines reasoned that the service 

bulletin specifies to inspect ‘‘before’’ 

500 FHs, while the NPRM proposed to 

inspect ‘‘within’’ 500 FHs. 

The FAA agrees. The FAA revised 

Required Actions, paragraphs (g)(1) and 

(2) of this AD to specify, ‘‘before 

accumulating 500 engine FHs.’’ 

Support for the AD 

ALPA expressed support for the 

NPRM as written. 

Conclusion 

The FAA reviewed the relevant data, 

considered any comments received, and 

determined that air safety requires 

adopting this AD as proposed. 

Accordingly, the FAA is issuing this AD 

to address the unsafe condition on these 

products. Except for minor editorial 

changes, and any other changes 

described previously, this AD is 

adopted as proposed in the NPRM. 

None of the changes will increase the 

economic burden on any operator. 

Related Service Information Under 1 

CFR Part 51 

The FAA reviewed General Electric 

CF34–8C Alert SB 72–A0335 R02 and 

General Electric CF34–8E Alert SB 72– 

A0221 R02, both dated February 25, 

2020. The Alert SBs specify procedures 

for performing a BSI of the combustion 

outer liner shell. These documents are 

distinct since they apply to different 

engine models. This service information 

is reasonably available because the 

interested parties have access to it 

through their normal course of business 

or by the means identified in 

ADDRESSES. 

Interim Action 

The FAA considers this AD to be an 

interim action. If final action is later 

identified, the FAA might consider 

further rulemaking. 

Costs of Compliance 

The FAA estimates that this AD 

affects 1,535 engines installed on 

airplanes of U.S. registry. 

The FAA estimates the following 

costs to comply with this AD: 

ESTIMATED COSTS

Action Labor cost Parts cost Cost per 

product 

Cost on U.S. 

operators 

BSI or visually inspect the combustion outer 

liner shell.

3 work-hours × $85 per hour = $255 ............. $0 $255 $391,425 

The FAA estimates the following 

costs to do any necessary replacements 

that would be required based on the 

results of the inspection. The agency has 

no way of determining the number of 

engines that might need this 

replacement: 

ON-CONDITION COSTS

Action Labor cost Parts cost Cost per 

product 

Replace the combustion outer liner shell ..................... 812 work-hours × $85 per hour = $69,020 .................. $80,000 $149,020 

51794 Federal Register / Vol. 86, No. 178 / Friday, September 17, 2021 / Rules and Regulations 

Authority for This Rulemaking 

Title 49 of the United States Code 

specifies the FAA’s authority to issue 

rules on aviation safety. Subtitle I, 

section 106, describes the authority of 

the FAA Administrator. Subtitle VII: 

Aviation Programs, describes in more 

detail the scope of the Agency’s 

authority. 

The FAA is issuing this rulemaking 

under the authority described in 

Subtitle VII, Part A, Subpart III, Section 

44701: General requirements. Under 

that section, Congress charges the FAA 

with promoting safe flight of civil 

aircraft in air commerce by prescribing 

regulations for practices, methods, and 

procedures the Administrator finds 

necessary for safety in air commerce. 

This regulation is within the scope of 

that authority because it addresses an 

unsafe condition that is likely to exist or 

develop on products identified in this 

rulemaking action. 

Regulatory Findings 

This AD will not have federalism 

implications under Executive Order 

13132. This AD will not have a 

substantial direct effect on the States, on 

the relationship between the national 

government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government. 

For the reasons discussed above, I 

certify that this AD: 

(1) Is not a ‘‘significant regulatory 

action’’ under Executive Order 12866, 

(2) Will not affect intrastate aviation 

in Alaska, and 

(3) Will not have a significant 

economic impact, positive or negative, 

on a substantial number of small entities 

under the criteria of the Regulatory 

Flexibility Act. 

List of Subjects in 14 CFR Part 39 

Air transportation, Aircraft, Aviation 

safety, Incorporation by reference, 

Safety. 

The Amendment 

Accordingly, under the authority 

delegated to me by the Administrator, 

the FAA amends 14 CFR part 39 as 

follows: 

PART 39—AIRWORTHINESS 

DIRECTIVES 

■ 1. The authority citation for part 39 

continues to read as follows: 

Authority: 49 U.S.C. 106(g), 40113, 44701. 

§ 39.13 [Amended] 

■ 2. The FAA amends § 39.13 by adding 

the following new airworthiness 

directive: 

2021–18–13 General Electric Company: 

Amendment 39–21714; Docket No. 

FAA–2019–0919; Project Identifier 

2019–NE–24–AD. 

(a) Effective Date 

This airworthiness directive (AD) is 

effective October 22, 2021. 

(b) Affected ADs 

None. 

(c) Applicability 

This AD applies to General Electric 

Company (GE) CF34–8C1, CF34–8C5, CF34– 

8C5A1, CF34–8C5B1, CF34–8C5A2, CF34– 

8C5A3, CF34–8E2, CF34–8E2A1, CF34–8E5, 

CF34–8E5A1, CF34–8E5A2, CF34–8E6, and 

CF34–8E6A1 model turbofan engines with an 

outer shell combustion liner (combustion 

outer liner shell), part number (P/N) 

4124T04G04, P/N 4124T04G05, or P/N 

5159T35G02, installed. 

(d) Subject 

Joint Aircraft System Component (JASC) 

Code 7240, Turbine Engine Combustion 

Section. 

(e) Unsafe Condition 

This AD was prompted by two in-flight 

engine shutdowns (IFSDs) that occurred as a 

result of failures of the combustion outer 

liner shell. The FAA is issuing this AD to 

prevent failure of the combustion outer liner 

shell. The unsafe condition, if not addressed, 

could result in burn-through of the lowpressure turbine case, engine fire, and 

damage to the airplane. 

(f) Compliance 

Comply with this AD within the 

compliance times specified, unless already 

done. 

(g) Required Actions 

(1) For an affected engine with a 

combustion outer liner shell that on the 

effective date of this AD has accumulated 

17,500 flight hours (FHs) or greater time 

since new (TSN), or time since repair (TSR), 

perform an initial borescope inspection (BSI) 

or visual inspection of the combustion outer 

liner shell for cracks before accumulating 500 

engine FHs after the effective date of this AD. 

(i) For GE CF34–8C engines, inspect using 

the Accomplishment Instructions, paragraphs 

3.A.(4) and 3.A.(5), of GE CF34–8C Alert 

Service Bulletin (SB) 72–A0335 R02, dated 

February 25, 2020 (CF34–8C Alert SB 72– 

A0335). 

(ii) For GE CF34–8E engines, inspect using 

the Accomplishment Instructions, paragraphs 

3.A.(4) and 3.A.(5), of GE CF34–8E Alert SB 

72–A0221 R02, dated February 25, 2020 

(CF34–8E Alert SB 72–A0221). 

Note 1 to paragraph (g)(1): GE has 

identified the service information as an 

‘‘Alert Service Bulletin,’’ which is stated only 

in the body of the Alert SB. 

(2) For an affected engine with a 

combustion outer liner shell that on the 

effective date of this AD has accumulated 

17,499 FHs or fewer TSN or TSR, before 

accumulating 500 engine FHs after the 

combustion outer liner shell has accumulated 

17,500 FHs TSN or TSR, perform an initial 

BSI or visual inspection on the combustion 

outer liner shell for cracks. 

(i) For GE CF34–8C engines, inspect using 

the Accomplishment Instructions, paragraphs 

3.A.(4) and 3.A.(5), of CF34–8C Alert SB 72– 

A0335. 

(ii) For GE CF34–8E engines, inspect using 

the Accomplishment Instructions paragraphs 

3.A.(4) and 3.A.(5), of CF34–8E Alert SB 72– 

A0221. 

(3) For an affected engine with a 

combustion outer liner shell for which it is 

not possible to determine the TSN or TSR, 

use the engine FHs since new to determine 

when to perform the initial BSI or visual 

inspection. 

(4) After the effective date of this AD, and 

after the initial inspection required by 

paragraph (g)(1) or (2) of this AD, re-inspect 

or remove the combustion outer liner shell 

using inspection criteria as follows: 

(i) For GE CF34–8C engines, use Table 1 of 

CF34–8C Alert SB 72–A0335. 

(ii) For GE CF34–8E engines, use Table 1 

of CF34–8E Alert SB 72–A0221. 

(h) Installation Prohibition 

After the effective date of this AD, do not 

install a combustion outer liner shell with 

greater than 17,500 FHs TSN or TSR without 

first inspecting the combustion outer liner 

shell in accordance with paragraph (g)(1) of 

this AD. 

(i) Definition 

For the purpose of this AD, ‘‘time since 

repair (TSR)’’ is the amount of FHs 

accumulated on the combustion outer liner 

shell since performing GEK 105091 or GEK 

112031, 72–44–06, REPAIR 023. 

(j) Credit for Previous Actions 

You may take credit for any initial BSI or 

visual inspection of the combustion outer 

liner shell required by paragraphs (g)(1) and 

(2) of this AD if you performed the initial BSI 

or visual inspection before the effective date 

of this AD using: 

(1) GE CF34–8C–AL S/B 72–A0335, 

Original Issue, dated June 27, 2019; 

(2) GE CF34–8C Alert SB 72–A0335 R01, 

dated September 23, 2019; 

(3) GE CF34–8E–AL S/B 72–A0221, 

Original Issue, dated June 27, 2019; or 

(4) GE CF34–8E Alert SB 72–A0221 R01, 

dated September 23, 2019. 

(k) Alternative Methods of Compliance 

(AMOCs) 

(1) The Manager, ECO Branch, FAA, has 

the authority to approve AMOCs for this AD, 

if requested using the procedures found in 14 

CFR 39.19. In accordance with 14 CFR 39.19, 

send your request to your principal inspector 

or local Flight Standards District Office, as 

appropriate. If sending information directly 

to the manager of the certification office, 

send it to the attention of the person 

identified in Related Information. You may 

email your request to: ANE-AD-AMOC@

faa.gov. 

(2) Before using any approved AMOC, 

notify your appropriate principal inspector, 

or lacking a principal inspector, the manager 

of the local flight standards district office/ 

certificate holding district office. 

Federal Register / Vol. 86, No. 178 / Friday, September 17, 2021 / Rules and Regulations 51795 

1 75 FR 2723 (January 15, 2010). 

2 76 FR 41602 (July 15, 2011). 

3Public Law 111–203 (2010). 

4 15 U.S.C. 1681 et seq. The Dodd-Frank Act does 

not transfer to the CFPB rulemaking authority for 

section 615(e) of the FCRA (‘‘Red Flag Guidelines 

and Regulations Required’’) and section 628 of the 

FCRA (‘‘Disposal of Records’’). See 15 U.S.C. 

1681s(e). 

5 77 FR 22200 (April 13, 2012); 12 U.S.C. 5519. 

6 15 U.S.C. 5519. 

7 77 FR 22200. 

8 Id. The Rule also sets forth requirements for 

entities that use credit scores. See, e.g., 16 CFR 

640.3(b). For ease of reference, in this 

supplementary information section users of 

consumer reports includes users of credit scores. 

9 12 CFR 1022.70–75. 

10The comments are available at 

www.regulations.gov/document/FTC-2020-0072- 

0001/comment. The Commission also received two 

comments that addressed regulation of lenders and 

motor vehicle dealers generally. Both comments 

argued such regulation was needed. 

(l) Related Information 

For more information about this AD, 

contact Scott Stevenson, Aviation Safety 

Engineer, ECO Branch, FAA, 1200 District 

Avenue, Burlington, MA 01803; phone: (781) 

238–7132; fax: (781) 238–7199; email: 

Scott.M.Stevenson@faa.gov. 

(m) Material Incorporated by Reference 

(1) The Director of the Federal Register 

approved the incorporation by reference 

(IBR) of the service information listed in this 

paragraph under 5 U.S.C. 552(a) and 1 CFR 

part 51. 

(2) You must use this service information 

as applicable to do the actions required by 

this AD, unless the AD specifies otherwise. 

(i) GE CF34–8C Alert Service Bulletin (SB) 

72–A0335 R02, dated February 25, 2020. 

(ii) GE CF34–8E Alert SB 72–A0221 R02, 

dated February 25, 2020. 

(3) For GE service information identified in 

this AD, contact General Electric Company, 

GE Aviation, Room 285, 1 Neumann Way, 

Cincinnati, OH 45215; phone: (513) 552– 

3272; email: aviation.fleetsupport@ge.com. 

(4) You may view this service information 

at FAA, Airworthiness Products Section, 

Operational Safety Branch, 1200 District 

Avenue, Burlington, MA 01803. For 

information on the availability of this 

material at the FAA, call (781) 238–7759. 

(5) You may view this service information 

that is incorporated by reference at the 

National Archives and Records 

Administration (NARA). For information on 

the availability of this material at NARA, 

email: fr.inspection@nara.gov, or go to: 

https://www.archives.gov/federal-register/cfr/ 

ibr-locations.html. 

Issued on August 26, 2021. 

Lance T. Gant, 

Director, Compliance & Airworthiness 

Division, Aircraft Certification Service. 

[FR Doc. 2021–20042 Filed 9–16–21; 8:45 am] 

BILLING CODE 4910–13–P 

FEDERAL TRADE COMMISSION 

16 CFR Part 640 and 698 

RIN 3084–AB63 

Duties of Creditors Regarding RiskBased Pricing Rule 

AGENCY: Federal Trade Commission. 

ACTION: Final rule. 

SUMMARY: The Federal Trade 

Commission (‘‘FTC’’ or ‘‘Commission’’) 

is issuing a final rule (‘‘Final Rule’’) to 

amend its Duties of Creditors Regarding 

Risk-Based Pricing Rule (‘‘Risk-Based 

Pricing Rule’’) and its related model 

notice to correspond to changes made to 

the Fair Credit Reporting Act (‘‘FCRA’’) 

by the Dodd-Frank Act and to clarify the 

model notice. 

DATES: Effective October 18, 2021. 

FOR FURTHER INFORMATION CONTACT: 

David Lincicum (202–326–2773), 

Division of Privacy and Identity 

Protection, Bureau of Consumer 

Protection, Federal Trade Commission, 

600 Pennsylvania Avenue NW, 

Washington, DC 20580. 

SUPPLEMENTARY INFORMATION: 

I. Background 

A. The Risk-Based Pricing Rule 

The Fair and Accurate Credit 

Transactions Act of 2003 (‘‘FACT Act’’) 

was signed into law on December 4, 

2003. Public Law 108–159, 117 Stat. 

1952. Section 311 of the FACT Act 

added section 615(h), 15 U.S.C. 

1681m(h), to the FCRA to address riskbased pricing. Risk-based pricing refers 

to the practice of setting or adjusting the 

price and other terms of credit offered 

or extended to a particular consumer to 

reflect the risk of nonpayment by that 

consumer. Information from a consumer 

report is often used in evaluating the 

risk posed by the consumer. Creditors 

that engage in risk-based pricing 

generally offer more favorable terms to 

consumers with good credit histories 

and less favorable terms to consumers 

with poor credit histories. 

Under section 615(h) of the FCRA, a 

person generally must provide a riskbased pricing notice to a consumer 

when the person uses a consumer report 

in connection with an extension of 

credit and, based in whole or in part on 

the consumer report, extends credit to 

the consumer on terms materially less 

favorable than the most favorable terms 

available to a substantial proportion of 

consumers. The risk-based pricing 

notice is designed primarily to improve 

the accuracy of consumer reports by 

alerting consumers to the existence of 

negative information in their consumer 

reports so consumers can, if they 

choose, check their consumer reports for 

accuracy and correct any inaccurate 

information. The Federal Reserve Board 

and the Commission jointly published 

regulations implementing these riskbased pricing provisions on January 15, 

2010.1 The Rule was then amended in 

July 2011 to include a requirement that, 

if a credit score is used in making the 

credit decision, the creditor must 

disclose that score and certain 

information relating to the credit score.2

B. Dodd-Frank Act 

The Dodd-Frank Wall Street Reform 

and Consumer Protection Act (‘‘DoddFrank Act’’) was signed into law in 

2010.3 The Dodd-Frank Act 

substantially changed the federal legal 

framework for financial services 

providers. Among the changes, the 

Dodd-Frank Act transferred to the 

Consumer Financial Protection Bureau 

(‘‘CFPB’’) the Commission’s rulemaking 

authority under portions of the FCRA.4

Accordingly, in 2012, the Commission 

rescinded several of its FCRA rules, 

which had been replaced by rules 

issued by the CFPB.5 The FTC retained 

rulemaking authority for other rules 

promulgated under the Acts to the 

extent the rules apply to motor vehicle 

dealers described in section 1029(a) of 

the Dodd-Frank Act 6 predominantly 

engaged in the sale and servicing of 

motor vehicles, the leasing and 

servicing of motor vehicles, or both.7

The retained rules include the RiskBased Pricing Rule, which now applies 

only to motor vehicle dealers that use 

consumer reports or credit scores for 

risk-based pricing.8 Consumer report or 

credit score users that are not motor 

vehicle dealers are covered by the 

CFPB’s rule.9

II. Regulatory Review of the Risk-Based 

Pricing Notice Rule 

On October 8, 2020, the Commission 

solicited comments on the Risk-Based 

Pricing Rule. The Commission sought 

information about the costs and benefits 

of the Rule, and its regulatory and 

economic impact. In addition, the 

Commission proposed amending part 

640 to narrow the scope of the Rule to 

motor vehicle dealers excluded from 

Consumer Financial Protection Bureau 

jurisdiction as described in the DoddFrank Act and remove examples that 

did not apply to motor vehicle dealers. 

The Commission received one comment 

related to the Risk-Based Pricing Rule.10

III. Overview of Final Rule 

A. Scope 

The Commission promulgated the 

Risk-Based Pricing Rule at a time when 

it had rulemaking authority for a