Federal Register / Vol. 61, No. 81 / Thursday, April 25, 1996 / Proposed Rules 18305

location provided under the caption

ADDRESSES.

List of Subjects in 14 CFR Part 39

Air transportation, Aircraft, Aviation

safety, Safety.

The Proposed Amendment

Accordingly, pursuant to the

authority delegated to me by the

Administrator, the Federal Aviation

Administration proposes to amend part

39 of the Federal Aviation Regulations

(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. Section 39.13 is amended by

adding the following new airworthiness

directive:

Mcdonnell Douglas: Docket 95–NM–115–AD.

Applicability: Model DC–8 airplanes

equipped with main landing gears having

swivel type bogie beams on which the swivel

pin lugs have not been nickel plated,

certificated in any category.

Note 1: This AD applies to each airplane

identified in the preceding applicability

provision, regardless of whether it has been

modified, altered, or repaired in the area

subject to the requirements of this AD. For

airplanes that have been modified, altered, or

repaired so that the performance of the

requirements of this AD is affected, the

owner/operator must request approval for an

alternative method of compliance in

accordance with paragraph (e) of this AD.

The request should include an assessment of

the effect of the modification, alteration, or

repair on the unsafe condition addressed by

this AD; and, if the unsafe condition has not

been eliminated, the request should include

specific proposed actions to address it.

Compliance: Required as indicated, unless

accomplished previously.

To prevent failure of the swivel-type bogie

beam of the main landing gear (MLG) due to

stress corrosion, which could result in

collapse of the MLG during landing,

accomplish the following:

(a) Perform a one-time magnetic particle

inspection to detect cracking of the swivel

bogie beam lugs, in accordance with

McDonnell Douglas DC–8 Service Bulletin

32–182, dated January 20, 1995; McDonnell

Douglas Service Bulletin DC8–32–182,

Revision 01, dated July 21, 1995, or Revision

02, dated August 30, 1995; at the later of the

times specified in paragraphs (a)(1) and (a)(2)

of this AD.

(1) Prior to the accumulation of 11,600

total flight hours, or within 10 years since the

installation of the forward bogie beam of the

MLG, whichever occurs first.

(2) Prior to the accumulation of 2,000 flight

hours, or 2 years after the effective date of

this AD, whichever occurs first.

(b) If no cracking is detected during the

inspection required by paragraph (a) of this

AD, prior to further flight, perform a visual

inspection to detect corrosion in the swivel

pin lug surfaces and bores, in accordance

with McDonnell Douglas DC–8 Service

Bulletin 32–182, dated January 20, 1995; or

McDonnell Douglas Service Bulletin DC8–

32–182, Revision 01, dated July 21, 1995, or

Revision 02, dated August 30, 1995.

Note 2: Particular attention should be paid

to the lubrication of the swivel pin lug and

the lower swivel pin bushing during regular

normal maintenance.

(1) If no corrosion is detected, prior to

further flight, accomplish paragraph (b)(1)(i),

(b)(1)(ii), (b)(1)(iii), or (b)(1)(iv) of this AD, as

applicable, in accordance with the service

bulletin.

(i) For Group I airplanes on which the

forward bogie beam has not been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group I airplanes) as Condition 1 of the

Accomplishment Instructions of the service

bulletin.

(ii) For Group I airplanes on which the

forward bogie beam has been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group I airplanes) as Condition 2 of the

Accomplishment Instructions of the service

bulletin.

(iii) For Group II airplanes on which the

forward bogie beam has not been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group II airplanes) as Condition 1 of the

Accomplishment Instructions of the service

bulletin.

(iv) For Group II airplanes on which the

forward bogie beam has been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group II airplanes) as Condition 2 of the

Accomplishment Instructions of the service

bulletin.

(2) If any corrosion is detected, prior to

further flight, accomplish paragraph (b)(2)(i),

(b)(2)(ii), (b)(2)(iii), or (b)(2)(iv), as

applicable, in accordance with the service

bulletin.

(i) For Group I airplanes on which the

forward bogie beam has not been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group I airplanes) as Condition 1 of the

Accomplishment Instructions of the service

bulletin. If the dimensions of the reworked

swivel pin lug exceed the limits specified in

Table I of the service bulletin, prior to further

flight, repair in accordance with a method

approved by the Manager, Los Angeles

Aircraft Certification Office (ACO), FAA,

Transport Airplane Directorate.

(ii) For Group I airplanes on which the

forward bogie beam has been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group I airplanes) as Condition 2 of the

Accomplishment Instructions of the service

bulletin. If the dimensions of the reworked

swivel pin lug exceed the limits specified in

Table I of the service bulletin, prior to further

flight, repair in accordance with a method

approved by the Manager, Los Angeles ACO.

(iii) For Group II airplanes on which the

forward bogie beam has not been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group II airplanes) as Condition 1 of the

Accomplishment Instructions of the service

bulletin. If the dimensions of the reworked

swivel pin lug exceed the limits specified in

Table I of the service bulletin, prior to further

flight, repair in accordance with a method

approved by the Manager, Los Angeles ACO.

(iv) For Group II airplanes on which the

forward bogie beam has been modified

previously: Modify the forward bogie beam

in accordance with the actions specified (for

Group II airplanes) as Condition 2 of the

Accomplishment Instructions of the service

bulletin. If the dimensions of the reworked

swivel pin lug exceed the limits specified in

Table I of the service bulletin, prior to further

flight, repair in accordance with a method

approved by the Manager, Los Angeles ACO.

(c) If any cracking is detected during the

inspection required by paragraph (a) of this

AD, prior to further flight, repair in

accordance with a method approved by the

Manager, Los Angeles ACO.

(d) As of the effective date of this AD, no

forward bogie beam swivel pin lug shall be

installed on any airplane, unless that swivel

pin lug has been modified in accordance

with McDonnell Douglas DC–8 Service

Bulletin 32–182, dated January 20, 1995; or

McDonnell Douglas Service Bulletin DC8–

32–182, Revision 01, dated July 21, 1995, or

Revision 02, dated August 30, 1995.

(e) An alternative method of compliance or

adjustment of the compliance time that

provides an acceptable level of safety may be

used if approved by the Manager, Los

Angeles ACO. Operators shall submit their

requests through an appropriate FAA

Principal Maintenance Inspector, who may

add comments and then send it to the

Manager, Los Angeles ACO.

Note 3: Information concerning the

existence of approved alternative methods of

compliance with this AD, if any, may be

obtained from the Los Angeles ACO.

(f) Special flight permits may be issued in

accordance with sections 21.197 and 21.199

of the Federal Aviation Regulations (14 CFR

21.197 and 21.199) to operate the airplane to

a location where the requirements of this AD

can be accomplished.

Issued in Renton, Washington, on April 19,

1996.

Darrell M. Pederson,

Acting Manager, Transport Airplane

Directorate, Aircraft Certification Service.

[FR Doc. 96–10208 Filed 4–24–96; 8:45 am]

BILLING CODE 4910–13–U
18306 Federal Register / Vol. 61, No. 81 / Thursday, April 25, 1996 / Proposed Rules

1 15 U.S.C. 78a et seq.

2 17 CFR 240.13e–4.

3 17 CFR 240.13e–4(h)(5); see Securities Exchange

Act Release No. 19988 (July 21, 1983), 48 FR 34251

(adopting the paragraph now designated as (h)(5) of

Rule 13e–4 excepting Odd-lot Offers from the Rule’s

requirements).

Rule 13e–4(f)(8)(i) requires that the tender offer

be open to all security holders of the class of

securities subject to the tender offer. 17 CFR

240.13e–4(f)(8)(i). Rule 13e–4(f)(8)(ii) requires that

consideration paid to any security holder pursuant

to an issuer tender offer be the highest

consideration paid to any other security holder

during such tender offer. 17 CFR 240.13e–4(f)(8)(ii).

4See Securities Exchange Act Release No. 19246

(November 18, 1982), 47 FR 53398, 53400

(proposing adoption of the paragraph now

designated as (h)(5) of Rule 13e–4).

5See, e.g., Letter regarding American Telephone

and Telegraph Company Odd-Lot Program, 1992

SEC No-Act. LEXIS 622 (May 4, 1992); Letter

regarding BellSouth Corporation Odd-Lot Program,

1992 SEC No-Act. LEXIS 631 (May 4, 1992).

SECURITIES AND EXCHANGE

COMMISSION

17 CFR Part 240

[Release No. 33–7283; 34–37132; File No.

S7–12–96]

RIN 3235–AG78

Odd-lot Tender Offers by Issuers

AGENCY: Securities and Exchange

Commission.

ACTION: Proposed Rule.

SUMMARY: The Securities and Exchange

Commission (‘‘Commission’’) is

publishing for comment a proposed

amendment to Rule 13e–4 (‘‘Rule 13e–

4’’ or ‘‘Rule’’) under the Securities

Exchange Act of 1934. Rule 13e–4

governs cash tender offers and exchange

offers by issuers for their equity

securities. The proposed amendment

would remove the Rule’s requirement

that issuer tender offers made to odd-lot

holders specify a record date of

ownership for eligibility to tender into

the offer. The amendment would enable

issuers to conduct extended odd-lot

tender offers for their equity securities.

DATES: Comments should be submitted

on or before May 28, 1996.

ADDRESSES: Comments should be

submitted in triplicate to Jonathan G.

Katz, Secretary, Securities and Exchange

Commission, 450 Fifth Street, N.W.,

Stop 6–9, Washington, D.C. 20549.

Comments also may be submitted

electronically at the following E-mail

address: rule-comments@sec.gov. All

comment letters should refer to File No.

S7–12–96; this file number should be

included on the subject line if E-mail is

used. All comments received will be

available for public inspection and

copying in the Commission’s Public

Reference Room, 450 Fifth Street, N.W.,

Washington, D.C. 20549. Electronically

submitted comment letters will be

posted on the Commission’s Internet

web site (http://www.sec.gov).

FOR FURTHER INFORMATION CONTACT: K.

Susan Grafton, Special Counsel, or

Lauren C. Mullen, Attorney, Office of

Risk Management and Control, Division

of Market Regulation, Securities and

Exchange Commission, 450 Fifth Street,

N.W., Stop 5–1, Washington, D.C.

20549, at (202) 942–0772.

SUPPLEMENTARY INFORMATION:

I. Background

A. Odd-lot Tender Offers

Rule 13e–4 under the Securities

Exchange Act of 1934 (‘‘Exchange

Act’’) 1 governs cash tender offers and

exchange offers by issuers for their

equity securities.2 In an odd-lot tender

offer (‘‘Odd-lot Offer’’), the offer to

purchase is limited to security holders

who own less than 100 shares (‘‘Odd-lot

Holders’’). The purpose of an Odd-lot

Offer generally is to reduce the issuer’s

disproportionately high cost of servicing

small shareholder accounts, and to

enable such shareholders to dispose of

their securities without incurring

brokerage fees.

In light of the limited purposes of

Odd-lot Offers and the fact that they are

not characterized by large premiums or

significant market impact, the majority

of these tender offers present minimal

potential for fraud and manipulation.

Thus, paragraph (h)(5) of Rule 13e–4

excepts Odd-lot Offers from the

application of the Rule’s requirements,

other than the ‘‘all holders’’ and ‘‘best

price’’ provisions contained in

paragraph (f)(8) of the Rule.3

B. Record Date Requirement

Paragraph (h)(5) of Rule 13e–4

requires issuers making Odd-lot Offers

to set a record date prior to the offer’s

announcement for the purpose of

determining a security holder’s

eligibility to participate in the offer.

This provision applies only to Odd-lot

Offers, and was incorporated into the

Rule to prevent holders of round-lots

from separating their holdings into

eligible odd-lots and tendering them

pursuant to the Odd-lot Offer.4 Also,

acceptance of such shares was

considered to result in added cost to the

issuer without achieving the

corresponding benefit from reducing the

number of its small shareholder

accounts. Furthermore, Odd-lot Holders

could be disadvantaged if such behavior

were to result in an oversubscription of

the Odd-lot Offer, causing bona fide

Odd-lot Holders to have their securities

rejected or prorated by the issuer.

Finally, the Commission was concerned

that Odd-lot Offers left open indefinitely

or for an extended period of time might

establish a minimum price for the

subject security. In adopting paragraph

(h)(5), the Commission expressed its

view that the record date requirement

would minimize any pegging effect by

limiting the number of shares eligible to

be purchased by the issuer at the tender

offer price.

C. Extended Odd-lot Offers

The requirement of a record date

places a practical limitation on the time

period that an Odd-lot Offer can be

made available, because only those

shareholders who were Odd-lot Holders

as of the record date may participate.

Recently, some issuers have expressed

an interest in offering to purchase oddlots on a continuous, periodic, or

extended basis (collectively, ‘‘Extended

Odd-lot Offers’’) to avoid the costs

associated with implementing

sequential programs. An issuer desiring

to make an Extended Odd-lot Offer must

obtain an exemption from the Rule’s

record date requirement.

Several exemptions have been granted

to allow issuers to conduct Extended

Odd-lot Offers.5 Based on information

provided to the staff, the Commission

preliminarily believes that the record

date requirement is no longer necessary

for the following reasons:

• Round-lot holders generally do not

separate their holdings into odd-lots to

participate in Extended Odd-lot Offers.

• Risk of prorationing or oversubscription is absent because Extended

Odd-lot Offers do not limit the number

of shares that will be accepted.

• There is little manipulative

incentive because an Extended Odd-lot

Offer typically involves a de minimis

percentage of an issuer’s outstanding

shares.

• Because the consideration offered

in an Extended Odd-lot Offer typically

is based on a uniformly applied formula

tied to the market price of the subject

security, and not on a fixed-price, it is

unlikely that such tender offer could be

used to peg the price of a security.

• Odd-lot transactions generally have

little influence on the market price of a

security, thus, even a fixed-price

Extended Odd-lot Offer is unlikely to

have a pegging effect on the subject

security.

In light of its experience with

Extended Odd-lot Offers and the

advantages of these programs for issuers

as well as for shareholders, the

Commission proposes to amend the

Rule to eliminate the mandatory record

date requirement.
Federal Register / Vol. 61, No. 81 / Thursday, April 25, 1996 / Proposed Rules 18307

6 17 CFR 240.10b–6 and 17 CFR 240.10b–13.

7See, e.g., Letter regarding Society National Bank,

1995 SEC No-Act. LEXIS 912 (December 11, 1995);

Letter regarding Armco, Inc., 1995 SEC No-Act.

LEXIS 754 (October 20, 1995); Letter regarding

Yankee Energy Systems, Inc., 1995 SEC No-Act.

LEXIS 142 (January 6, 1995); and Letter regarding

El Paso Natural Gas Company, 1994 SEC No-Act.

LEXIS 52 (January 7, 1994). The Commission

previously has granted exemptions from Rule 10b–

13 to permit the issuer, or the broker or trustee for

the Odd-lot Offer, to bid for or purchase securities

that are the subject of the Odd-lot Offer in order to

satisfy a round up feature of the Odd-lot Offer, or

to satisfy the requirements of issuer plans, provided

that no such purchases are made otherwise than

pursuant to the offer from the Odd-lot Holders

eligible to participate in the Odd-lot Offer. The

proposed exemptions from Rule 10b–13, if issued,

would not include a restriction on purchases of

securities from eligible Odd-lot Holders. Comment

is requested on whether such a restriction should

be included.

8On April 11, 1996, the Commission issued a

release proposing new Regulation M, which would

replace Rule 10b–6, among other rules. Securities

Exchange Act Release No. 37094 (April 11, 1996).

Proposed Rule 102 of Regulation M would permit

issuers to purchase odd-lots during a distribution.

If the Commission determines to issue the proposed

class exemption from Rule 10b–6 for Odd-lot Offers,

it may be superseded by adoption of Regulation M.

9 If adopted, the proposed amendment, along with

any class exemptions from Rules 10b–6 and 10b–

13, would supersede any prior exemptions granted

with respect to Odd-lot Offers. These provisions,

however, would not address other issues that may

be raised by Odd-lot Offers under the Securities Act

of 1933, 15 U.S.C. 77a et seq., or under Sections

15(a) or 14(d) of the Exchange Act, 15 U.S.C. 78o(a)

or 78n(d), respectively. See, e.g., Letter regarding

Armco, Inc., supra note 7.

10 5 U.S.C. 601 et seq. Although Section 601(b) of

the Regulatory Flexibility Act defines the term

‘‘small entity,’’ the statute permits agencies to

formulate their own definitions. 5 U.S.C. 601(b).

The Commission has adopted definitions of the

term small entity for purposes of Commission

rulemaking in accordance with the Regulatory

Flexibility Act. Those definitions are set forth in

Rule 0–10, 17 CFR 240.0–10. See Securities

Exchange Act Release No. 18452 (January 28, 1982).

An issuer, other than an investment company, is a

‘‘small business’’ or ‘‘small organization’’ under

Rule 0–10, if the issuer, on the last business day of

its most recent fiscal year, had total assets of

$5,000,000 or less.

D. Related Issues

Odd-lot Offers also raise issues under

Rules 10b–6 and 10b–13 under the

Exchange Act.6 Rule 10b–6 is an antimanipulation rule that, subject to

certain exceptions, prohibits persons

engaged in a distribution of securities

from bidding for or purchasing, or

inducing others to purchase, such

securities, or any related securities,

until they have completed their

participation in the distribution. The

rule is intended to prevent distribution

participants and their affiliated

purchasers from artificially conditioning

the market for the subject security in

order to facilitate the offering, and to

protect the integrity of the securities

market as an independent pricing

mechanism. Rule 10b–13 prohibits any

person making a cash tender offer or

exchange offer for an equity security

from purchasing or arranging to

purchase such security, or any security

immediately convertible into or

exchangeable for such security,

otherwise than pursuant to the tender or

exchange offer, during the period

commencing as of the public

announcement of the offer and ending

on the date when the offer must, by its

terms, be accepted or rejected. The rule

is intended to eliminate the incentive

for the bidder to purchase shares from

certain holders otherwise than pursuant

to the offer at a more favorable price

than the tender offer consideration.

Where an issuer is involved in a

distribution, as defined in Rule 10b–6,

purchases by the issuer (or its affiliated

purchasers) of securities that are the

subject of the distribution are restricted,

including purchases pursuant to an

Odd-lot Offer. For example, the issuer

may wish to conduct a public offering

during an Odd-lot Offer, or the

securities purchased during an Odd-lot

Offer may be resold in a manner

constituting a distribution. Securities

also may need to be purchased in

connection with an Odd-lot Offer to

satisfy the request of Odd-lot Holders

who want to ‘‘round up’’ their holdings.

In addition, purchases by an issuer

conducting an Odd-lot Offer also are

restricted by Rule 10b–13, which

prohibits purchases of the target

security, including purchases in

connection with an open market

repurchase program, once the Odd-lot

Offer is publicly announced and

continuing until its expiration.

Issuers frequently have sought

exemptive relief from Rules 10b–6 and

10b–13 in connection with their

Extended Odd-lot Offers.7 The

Commission is proposing to issue class

exemptions from Rules 10b–6 8 and

10b–13 that would permit issuers to

conduct Odd-lot Offers while the issuer

is engaged in a distribution under Rule

10b–6, to round up odd-lots on behalf

of Odd-lot Holders, and to make

purchases of its securities otherwise

than pursuant to the Odd-lot Offer.9 The

class exemptions from Rules 10b–6 and

10b–13 would be available during any

Odd-lot Offer.

II. Request for Comment

The Commission requests that

interested persons submit comments on

any aspect of the proposed amendment

to Rule 13e–4 to eliminate the record

date requirement. If the record date

requirement is deleted, issuers would

not be able to specify a record date in

an Odd-lot Offer because of the Rule’s

‘‘all holders’’ provision. Should Rule

13e–4 retain a provision to permit

issuers to specify a record date in an

Odd-lot Offer? Commenters should

discuss whether there is any potential

for round-lot holders to divide their

round-lots to participate in Extended

Odd-lot Offers. The Commission is

interested in information regarding

issuers’ experiences with Odd-lot

Offers, including Extended Odd-lot

Offers.

Additionally, the Commission

encourages comment on any potential

market impact of Extended Odd-lot

Offers. Is there any opportunity for an

Extended Odd-lot Offer to have a

pegging effect on the security’s price?

Should Extended Odd-lot Offers be

limited to those offering a consideration

based on a market price formula (e.g.,

based on the average price per share of

the securities subject to the offer)?

Finally, the Commission seeks

comment on the proposed class

exemptions from Rules 10b–6 and 10b–

13.

Comments should be submitted in

triplicate to Jonathan G. Katz, Secretary,

Securities and Exchange Commission,

450 Fifth Street, NW., Stop 6–9,

Washington, DC 20549, and should refer

to file No. S7–12–96. Comments also

may be submitted electronically at the

following E-mail address: rulecomments@sec.gov, and should include

the file number on the subject line of the

E-mail.

III. Summary of Initial Regulatory

Flexibility Act Analysis

The Regulatory Flexibility Act, which

became effective on January 1, 1981,

imposes procedural steps applicable to

agency rulemaking which has a

‘‘significant economic impact on a

substantial number of small entities.’’ 10

The Chairman of the Commission has

certified pursuant to the Regulatory

Flexibility Act that the proposed

amendment to Rule 13e–4, if adopted,

will not have a significant economic

impact on a substantial number of small

entities. This certification, including the

reasons therefore, is attached to this

release as Appendix A.

IV. Statutory Basis

Pursuant to Sections 3(b), 9(a)(6),

10(b), 13(e), 14(e), and 23(a) of the

Exchange Act; 15 U.S.C. 78c(b),

78i(a)(6), 78j(b), 78m(e), 78n(e), and

78w(a), the Commission proposes to

amend Rule 13e–4 in Chapter II of Title

17 of the Code of Federal Regulations by

amending paragraph (h)(5) of § 240.13e–

4.
18308 Federal Register / Vol. 61, No. 81 / Thursday, April 25, 1996 / Proposed Rules

List of Subjects in 17 CFR Part 240

Brokers, Confidential business

information, Fraud, Reporting and

recordkeeping requirements, Securities.

Text of the Proposed Amendment

For the reasons set out in the

preamble, the Commission is proposing

to amend Title 17, Chapter II of the

Code of Federal Regulations as follows:

PART 240—GENERAL RULES AND

REGULATIONS, SECURITIES

EXCHANGE ACT OF 1934

1. The authority citation for part 240

continues to read, in part, as follows:

Authority: 15 U.S.C. 77c, 77d, 77g, 77j,

77s, 77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c,

78d, 78i, 78j, 78l, 78m, 78n, 78o, 78p, 78q,

78s, 78w, 78x, 78ll(d), 79q, 79t, 80a–20, 80a–

23, 80a–29, 80a–37, 80b–3, 80b–4 and 80b–

11, unless otherwise noted.

* * * * *

§ 240.13e–4 [Amended]

2. Section 240.13e–4 is amended by

removing the phrase ‘‘as of a specified

date prior to the announcement of the

offer’’ from the introductory text of

paragraph (h)(5).

Dated: April 19, 1996.

By the Commission.

Jonathan G. Katz,

Secretary.

Note: This Appendix A to the Preamble

will not appear in the Code of Federal

Regulations.

Appendix A

Regulatory Flexibility Act Certification

I, Arthur Levitt, Chairman of the Securities

and Exchange Commission, hereby certify

pursuant to 5 U.S.C. 605(b) that the proposed

amendment to Rule 13e–4 set forth in

Securities Exchange Act Release No. 37132,

if promulgated, will not have a significant

economic impact on a substantial number of

small entities. Specifically, issuers making a

tender offer to holders of odd-lots will be

excepted from the record date requirements

of the rule, and will no longer be required to

distinguish between their odd-lot holders on

the basis of the dates upon which those

security holders acquired their odd-lot

holdings. Accordingly, issuers will be

relieved of the need to request an exemption

from the provisions of the rule to conduct

periodic, continuous, or extended odd-lot

offers. Although the proposed amendment to

Rule 13e–4 is expected to have favorable

effects on issuers and small investors, the

size of these effects will not have a

significant economic impact on a substantial

number of small entities.

Dated: April 19, 1996.

Arthur Levitt,

Chairman.

[FR Doc. 96–10243 Filed 4–24–96; 8:45 am]

BILLING CODE 8010–01–P

DEPARTMENT OF LABOR

Mine Safety and Health Administration

30 CFR Parts 70 and 71

RIN: 1219–AA81

Response to National Institute for

Occupational Safety and Health

(NIOSH) Criteria Document

AGENCY: Mine Safety and Health

Administration, Labor.

ACTION: Response to NIOSH criteria

document.

SUMMARY: On November 7, 1995, the

Mine Safety and Health Administration

(MSHA) received a criteria document

from the National Institute for

Occupational Safety and Health

(NIOSH) entitled Criteria for a

Recommended Standard: Occupational

Exposure to Respirable Coal Mine Dust

(Criteria Document), which contains a

number of recommendations for

reducing occupational health risks

associated with exposures to respirable

coal mine dust and crystalline silica.

The Federal Mine Safety and Health Act

of 1977 (Mine Act) requires MSHA to

issue a public response to such criteria

documents.

MSHA has determined that it will

respond to the Criteria Document by

developing a proposed rule to enhance

protection for miners from exposure to

respirable coal mine dust and

crystalline silica. Although MSHA will

begin preliminary work on a proposed

rule, the Agency will defer full

development of the rule until it can

consider the broad range of

recommendations expected to be issued

in the fall by the Secretary’s Advisory

Committee to Eliminate

Pneumoconiosis among Coal Mine

Workers.

FOR FURTHER INFORMATION CONTACT:

Patricia W. Silvey, Director, Office of

Standards, Regulations, and Variances,

MSHA, 4015 Wilson Boulevard, Room

631, Arlington, Virginia 22203, 703–

235–1910.

SUPPLEMENTARY INFORMATION:

I. Rulemaking History

The Federal Mine Safety and Health

Act of 1977, 30 U.S.C. 801 et seq., (Mine

Act) authorizes the National Institute for

Occupational Safety and Health

(NIOSH) of the U.S. Department of

Health and Human Services to

recommend that the Secretary of Labor

promulgate specific occupational safety

and health standards to achieve the

objectives of the Mine Act. By means of

criteria documents, NIOSH notifies

MSHA of its recommendations for

health and safety standards. When the

Secretary of Labor receives any such

recommendations from NIOSH, Section

101(a)(1) of the Mine Act requires him

to take one of three actions within 60

days: (1) refer such recommendations to

an advisory committee; (2) publish such

recommendations as a proposed rule; or

(3) publish in the Federal Register his

determination not to do so and his

reasons therefor.

On November 7, 1995, NIOSH

submitted to MSHA a Criteria Document

addressing the occupational health risks

associated with exposure to respirable

coal mine dust and crystalline silica.

The criteria document contained a

number of recommendations, including

that MSHA reduce its permissible

exposure limit for respirable coal mine

dust and establish a separate standard

for crystalline silica.

Although the statutory deadline for

MSHA’s response fell on January 7,

1996, the funding lapse for the U.S.

Department of Labor and the resulting

shutdown prevented timely action on

this matter. On January 10, 1996, MSHA

informed the public by notice in the

Federal Register (61 FR 731) that it

would respond to the Criteria Document

as quickly as possible after the

resumption of normal agency

operations.

II. Agency Determination

MSHA has determined that it will

respond to the NIOSH Criteria

Document through the publication of a

proposed rule derived from the

recommendations in the Document. The

proposed rule will address enhanced

protections for surface and underground

coal miners from exposure to respirable

coal mine dust and crystalline silica.

Although MSHA will begin the

background work necessary to develop

such a rule, the Agency will delay full

development of the proposed rule until

it has received and considered the

recommendations of the Advisory

Committee to Eliminate

Pneumoconiosis among Coal Mine

Workers, which is currently addressing

a number of issues that are the subject

of recommendations in the Criteria

Document. The Advisory Committee

was established by the Secretary of

Labor on January 31, 1995, and was

charged with making recommendations

for improved standards and other

appropriate action in a number of areas,

including permissible exposure limits to

eliminate black lung disease and

silicosis; the means to control respirable

coal mine dust levels; improved

monitoring of respirable coal mine dust

levels and the role of the miner in that

monitoring; and the adequacy of the