Procedures for Submission of Rules Under the Horseracing Integrity and Safety Act
| Published date | 05 October 2021 |
| Citation | 86 FR 54819 |
| Record Number | 2021-21306 |
| Section | Rules and Regulations |
| Court | Federal Trade Commission |
Federal Register, Volume 86 Issue 190 (Tuesday, October 5, 2021)
[Federal Register Volume 86, Number 190 (Tuesday, October 5, 2021)]
[Rules and Regulations]
[Pages 54819-54826]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-21306]
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FEDERAL TRADE COMMISSION
16 CFR Part 1
Procedures for Submission of Rules Under the Horseracing
Integrity and Safety Act
AGENCY: Federal Trade Commission.
ACTION: Final rule.
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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') is
issuing rules pursuant to the Horseracing Integrity and Safety Act
(``Act'') to provide procedures for the Horseracing Integrity and
Safety Authority (``Authority'') to submit its proposed rules and
proposed rule modifications to the Commission for review.
DATES: These rule revisions are effective on October 5, 2021.
FOR FURTHER INFORMATION CONTACT: Austin King (202-326-3166), Associate
General Counsel for Rulemaking, Office of the General Counsel, Federal
Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580.
SUPPLEMENTARY INFORMATION: The Horseracing Integrity & Safety Act,\1\
enacted on December 27, 2020, directs the Federal Trade Commission to
oversee the activities of a private, self-regulatory organization
called the Horseracing Integrity and Safety Authority.
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\1\ 15 U.S.C. 3051 through 3060.
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Section 4(a) of the Act, 15 U.S.C. 3053(a), requires the Authority
to submit to the Commission, in accordance with such rules as the
Commission may prescribe under Section 553 of Title 5, United States
Code, any proposed rule, or proposed modification to a rule, of the
Authority relating to: (1) The bylaws of the Authority; (2) a list of
permitted and prohibited medications, substances, and methods,
including allowable limits of permitted medications, substances, and
methods; (3) laboratory standards for accreditation and protocols; (4)
standards for racing surface quality maintenance; (5) racetrack safety
standards and protocols; (6) a program for injury and fatality data
analysis; (7) a program of research and education on safety,
performance, and anti-doping and medication control; (8) a description
of safety, performance, and anti-doping and medication control rule
violations applicable to covered horses and covered persons; (9) a
schedule of civil sanctions for violations; (10) a process or
procedures for disciplinary hearings; and (11) a formula or methodology
for determining the assessments described in 15 U.S.C. 3052(f).
Accordingly, the Commission is adding a new subpart S to part 1 of
its Rules of Practice, to provide procedures for the Authority to file
its proposed rules and proposed modifications to existing rules with
the Commission for review.
I. Section 1.140--Definitions
Section 1.140 defines relevant terms used in the proposed
regulations. Each definition is based on a corresponding definition
contained in Section 2 of the Act, 15 U.S.C. 3051, except as otherwise
noted below.
The definition of ``HISA Guidance'' derives from Section 5(g)(1) of
the Act, 15 U.S.C. 3054(g)(1), which states the Authority may issue
guidance that ``sets forth an interpretation of an existing rule,
standard, or procedure of the Authority'' or a ``policy or practice
with respect to the administration or enforcement of such an existing
rule, standard, or procedure'' and ``relates solely to the
administration of the Authority; or any other matter, as specified by
the Commission, by rule, consistent with the public interest and the
purposes of this subsection [15 U.S.C. 3054(g)(1)].'' The Commission is
adopting this definition and adding that HISA Guidance does not have
the force of law, to distinguish HISA Guidance from a proposed
modification to a rule.
The Act does not contain definitions for ``proposed rule'' or
``proposed modification.'' However, because these terms are used
frequently throughout the regulations, the Commission is defining them
for clarity. ``Proposed rule'' is defined as any rule proposed by the
Authority pursuant to the Act. ``Proposed rule modification'' or
``modification'' is defined as any proposed modification to a rule,
proposed rule change, or any interpretation or statement of policy or
practice relating to an existing rule of the Authority that is not HISA
Guidance and would have the force of law if
[[Page 54820]]
approved as a final rule. A proposed modification is distinguished from
HISA Guidance in that a modification would have the force of law if
approved and must therefore be approved by the Commission pursuant to
Section 4(b)(2) of the Act, 15 U.S.C. 3053(b)(2). HISA Guidance need
not be approved by the Commission but takes effect upon submission to
the Commission pursuant to Section 5(g)(3) of the Act, 15 U.S.C.
3054(g)(3).
II. Section 1.141--Required Submissions
The Act requires the Authority to submit proposed rules or proposed
rule modifications on certain subjects to the Commission for approval.
These subjects are set forth in Section 4(a) of the Act, 15 U.S.C.
3053(a), which states the Authority must submit to the Commission, in
accordance with such rules as the Commission may prescribe under
Section 553 of Title 5, any proposed rule, or proposed modification to
a rule, of the Authority relating to: (1) The bylaws of the Authority;
(2) a list of permitted and prohibited medications, substances, and
methods, including allowable limits of permitted medications,
substances, and methods; (3) laboratory standards for accreditation and
protocols; (4) standards for racing surface quality maintenance; (5)
racetrack safety standards and protocols; (6) a program for injury and
fatality data analysis; (7) a program of research and education on
safety, performance, and anti-doping and medication control; (8) a
description of safety, performance, and anti-doping and medication
control rule violations applicable to covered horses and covered
persons; (9) a schedule of civil sanctions for violations; (10) a
process or procedures for disciplinary hearings; and (11) a formula or
methodology for determining assessments described in 15 U.S.C. 3052(f).
The Commission is adopting this language in its regulations.
The Commission is also adding a provision that the Authority must
submit ``any other proposed rule or modification the Act requires the
Authority to submit to the Commission for approval.'' For instance, the
Act requires the Authority to submit rules regarding modifications to
baseline anti-doping standards (15 U.S.C. 3055(g)(3)(b)) and
modifications to racetrack safety rules (15 U.S.C. 3056(c)(2)(B)(ii)).
Section 5(c)(2) of the Act, 15 U.S.C. 3054(c)(2), requires the
Authority to submit to the Commission for approval any rules and
procedures under Section 5(c)(1)(A) of the Act, 15 U.S.C.
3054(c)(1)(A), authorizing access to offices, racetrack facilities,
other places of business, books, records, and personal property of
covered persons used in the care, treatment, training, and racing of
covered horses; authorizing the issuance and enforcement of subpoenas
and subpoenas duces tecum; and authorizing other investigatory powers
of the nature and scope exercised by State racing commissions before
the program effective date. Such proposed rules and modifications must
also be submitted to the Commission for approval.
III. Section 1.142--Submission of Proposed Rule or Modification
The Act requires the Commission to evaluate the Authority's
proposed rules and modifications to determine whether they are
consistent with the Act and the applicable rules approved by the
Commission. See 15 U.S.C. 3053(c)(2). To avoid delays in the rule
review process, the Commission is requiring the Authority to submit the
information necessary for it to evaluate the proposed rule or
modification promptly and efficiently. Section 1.142 is designed to
elicit the information the Commission needs to determine whether the
proposed rule or modification is consistent with the Act and the rules
and regulations issued thereunder.
A. Contents of Submission
For a submission to qualify as a proposed rule or proposed
modification to a rule under Section 4(a) of the Act, 15 U.S.C.
3053(a), the Authority must submit a complete draft of the Federal
Register document for its proposed or modified rule, which includes the
text of the rule and a statement of the purpose of, and statutory basis
for, the proposed rule or modification. The Commission's intention is
to require the Authority to provide an explanation of its rules that
will allow both the Commission and the public to understand the nature
and purpose of its proposed rules or modifications--the reasons for
adopting the proposed rule or modification; any problems the proposed
rule or modification is intended to address and how the proposed rule
or modification will resolve those problems; and how the proposed rule
or modification will affect covered persons, covered horses, and
covered horseraces.
The Commission is also requiring the Authority to explain the
statutory basis for its proposed rules or modifications. To evaluate a
proposed rule or modification, the Commission must be able to
understand why the Authority believes its proposed rule or modification
is consistent with the Act and the applicable rules approved by the
Commission. Evaluation of a proposed rule or modification will also be
aided by the Authority's description of any reasonable alternatives it
considered and the reasons it selected the proposed rule or
modification over the alternatives.
The Act does not give the Authority broad discretion in developing
rules. It sets forth guardrails, in the form of baseline standards for
anti-doping and medication control (15 U.S.C. 3055(g)(2)(A)), racetrack
safety standards which the Authority must consider (15 U.S.C.
3056(a)(2)), guidelines for determining funding and calculating costs
(15 U.S.C. 3052(f)(1)(C)(ii)), a specific formula for the assessment
and collection of fees (15 U.S.C. 3052(f)(3)(C)), who must register
with the Authority and the conditions of registration (15 U.S.C.
3054(d)), guidelines for establishing rule violations (15 U.S.C.
3057(a)(2)), requisite elements of the Authority's results management
and disciplinary program (15 U.S.C. 3057(c)(2)), guidelines for
establishing civil sanctions (15 U.S.C. 3057(d)(2)), and more.
Accordingly, the Authority must explain why its proposed rule or
modification is consistent with any standards in the Act and the rules
approved by the Commission. Because the requisite considerations for
anti-doping and racetrack safety are the most prescriptive, this
section specifically addresses those standards and factors. The less
prescriptive standards and factors must also be addressed, and the
Commission provides for this in a less prescriptive rule, as discussed
below.
1. Anti-Doping and Medication Control Program Considerations
When proposing a rule or modification to the horseracing anti-
doping and medication control program, the Authority must explain how
it considered the factors in Section 6 of the Act, 15 U.S.C. 3055,
including the unique characteristics of a breed of horse made subject
to the Act by election of a State racing commission or breed governing
organization for such horse pursuant to Section 5(l) of the Act, 15
U.S.C. 3054(l), as required by Section 6(a)(2) of the Act, 15 U.S.C.
3055(a)(2). The Authority must explain how it considered the factors in
Section 6(b) of the Act, 15 U.S.C. 3055(b), namely that: (1) Covered
horses should compete only when they are free from the influence of
medications, other foreign substances, and methods that affect their
performance; (2) covered horses that are injured or unsound should not
train or participate in covered races, and the use
[[Page 54821]]
of medications, other foreign substances, and treatment methods that
mask or deaden pain in order to allow injured or unsound horses to
train or race should be prohibited; (3) rules, standards, procedures,
and protocols regulating medication and treatment methods for covered
horses and covered races should be uniform and uniformly administered
nationally; (4) to the extent consistent with chapter 57A of title 15,
consideration should be given to international anti-doping and
medication control standards of the International Federation of
Horseracing Authorities and the Principles of Veterinary Medical Ethics
of the American Veterinary Medical Association; (5) the administration
of medications and treatment methods to covered horses should be based
on an examination and diagnosis that identifies an issue requiring
treatment for which the medication or method represents an appropriate
component of treatment; (6) the amount of therapeutic medication a
covered horse receives should be the minimum necessary to address the
diagnosed health concerns identified during the examination and
diagnostic process; and (7) the welfare of covered horses, the
integrity of the sport, and the confidence of the betting public
require full disclosure to regulatory authorities regarding the
administration of medications and treatments to covered horses.
In addition, Section 6(g)(2)(A) of the Act, 15 U.S.C.
3055(g)(2)(A), provides that certain baseline anti-doping and
medication control rules must constitute the initial rules of the
horseracing anti-doping and medication control program and, except as
exempted pursuant to Section 6(e) and (f) of the Act, 15 U.S.C. 3055(e)
and (f), remain in effect at all times after the program effective
date. Such baseline anti-doping and medication control rules include:
(1) The lists of permitted and prohibited substances (including drugs,
medications, and naturally occurring substances and synthetically
occurring substances) in effect for the International Federation of
Horseracing Authorities, including the International Federation of
Horseracing Authorities International Screening Limits for urine, dated
May 2019, and the International Federation of Horseracing Authorities
International Screening Limits for plasma, dated May 2019; (2) the
World Anti-Doping Agency International Standard for Laboratories
(version 10.0), dated November 12, 2019; (3) the Association of Racing
Commissioners International out-of-competition testing standards, Model
Rules of Racing (version 9.2); and (4) the Association of Racing
Commissioners International penalty and multiple medication violation
rules, Model Rules of Racing (version 6.2). In the case of a conflict
among the rules, Section 6(g)(2)(B) of the Act, 15 U.S.C.
3055(g)(2)(B), provides that the most stringent rule shall apply.
Accordingly, the Commission is requiring the Authority to state whether
a proposed rule adopts the baseline standards identified in Section
6(g)(2)(A) of the Act, 15 U.S.C. 3055(g)(2)(A). If there is a conflict
in any baseline standards identified in Section 6(g)(2)(A) of the Act,
15 U.S.C. 3055(g)(2)(A), the Authority must identify the conflict and
state whether the standard it adopted is the most stringent standard.
Under Section 6(g)(3)(C) of the Act, 15 U.S.C. 3055(g)(3)(C), ``[t]he
Authority shall not approve any proposed modification that renders an
anti-doping and medication control rule less stringent than the
baseline anti-doping and medication control rules . . . without the
approval of the anti-doping and medication control enforcement
agency.'' Thus, for a proposed rule modification, the Authority must
explain whether the modification renders an anti-doping and medication
control rule less stringent than the baseline anti-doping and
medication control rules described in Section 6(g)(2)(A) of the Act, 15
U.S.C. 3055(g)(2)(A), and state whether the anti-doping and medication
control enforcement agency has approved of the change.
2. Racetrack Safety Program Considerations
Section 7 of the Act, 15 U.S.C. 3056, requires the Authority to
consider certain factors when developing the racetrack safety program.
Accordingly, when proposing a rule or modification to any rule
regarding its racetrack safety program, the Authority must explain how
the proposed rule or modification meets the requirements in Section
7(b) of the Act, 15 U.S.C. 3056(b), which provides that the horseracing
safety program must include the following: (1) A set of training and
racing safety standards and protocols taking into account regional
differences and the character of differing racing facilities; (2) a
uniform set of training and racing safety standards and protocols
consistent with the humane treatment of covered horses, which may
include lists of permitted and prohibited practices or methods (such as
crop use); (3) a racing surface quality maintenance system that takes
into account regional differences and the character of differing racing
facilities (which may include requirements for track surface design and
consistency and established standard operating procedures related to
track surface, monitoring, and maintenance, such as standardized
seasonal assessment, daily tracking, and measurement); (4) a uniform
set of track safety standards and protocols, that may include rules
governing oversight and movement of covered horses and human and equine
injury reporting and prevention; (5) programs for injury and fatality
data analysis, that may include pre- and post-training and race
inspections, use of a veterinarian's list, and concussion protocols;
(6) the undertaking of investigations at racetrack and non-racetrack
facilities related to safety violations; (7) procedures for
investigating, charging, and adjudicating violations and for the
enforcement of civil sanctions for violations; (8) a schedule of civil
sanctions for violations; (9) disciplinary hearings, which may include
binding arbitration, civil sanctions, and research; (10) management of
violation results; (11) programs relating to safety and performance
research and education; and (12) an evaluation and accreditation
program that ensures racetracks in the United States meet the standards
described in the elements of the Horseracing Safety Program.
The Authority must also consider the safety standards in Section
7(a)(2) of the Act, 15 U.S.C. 3056(a)(2), which provide that in the
development of the horseracing safety program for covered horses,
covered persons, and covered horseraces, the Authority and the
Commission must take into consideration existing safety standards,
including the National Thoroughbred Racing Association Safety and
Integrity Alliance Code of Standards, the International Federation of
Horseracing Authority's International Agreement on Breeding, Racing,
and Wagering, and the British Horseracing Authority's Equine Health and
Welfare program. The Commission is therefore requiring the Authority to
explain how it considered and whether it adopted any of the standards
in Section 7(a)(2) of the Act,15 U.S.C. 3056(a)(2). If any horseracing
safety standards in Section 7(a)(2) of the Act, 15 U.S.C. 3056(a)(2),
were considered but not adopted or were modified, the Authority must
explain why it decided not to adopt or why it decided to modify such
standard.
3. Other Considerations
The Commission is incorporating the specific anti-doping and
racetrack safety standards into this section because they are the most
prescriptive and extensive, but this should not be read as an
[[Page 54822]]
invitation to dispense with the less-prescriptive guardrails set forth
in the Act. To the extent the Act requires the Authority to consider
any factors or standards not specifically referenced in this section,
the Authority must explain whether and how it considered those factors
when proposing a rule or modification. For instance, when proposing a
civil sanctions rule or modification pursuant to Section 8(d)(1) of the
Act, 15 U.S.C. 3057(d)(1), the Authority must explain how the rule or
modification meets the requirements of Section 8(d)(2) of the Act, 15
U.S.C. 3057(d)(2).
B. Supporting Documentation
The Commission is requiring the Authority to submit any pertinent
factual information it relied on in developing its proposed rule or
modification. More specifically, the Authority's submission to the
Commission must include a copy of existing standards used as a
reference for the development of a proposed rule or modification and
any scientific data, studies, or analysis underlying the development of
the proposed rule or modification. The Commission anticipates
receiving, for instance, a copy of the lists of permitted and
prohibited substances in effect for the International Federation of
Horseracing Authorities, including the International Federation of
Horseracing Authorities International Screening Limits for urine, dated
May 2019, and any other rules and standards referenced in Section
6(g)(2)(A) of the Act, 15 U.S.C. 3055(g)(2)(A) when the Authority's
baseline rules for anti-doping are submitted. For organizational
purposes, supporting documentation must be attached as exhibits, and
each exhibit must clearly identify the proposed rule or modification it
supports.
C. Redline Document for Proposed Rule Modification
To enable the Commission to quickly and easily identify the
substance of a proposed rule modification, the Commission is requiring
the Authority to provide a redline document of the existing rule,
marked with the proposed changes.
D. Timing of Submission
Section 4(c)(1) of the Act, 15 U.S.C. 3053(c)(1) provides for a 60-
day timeframe between the Commission's publication of the Authority's
proposed rule or modification in the Federal Register for public
comment and the date the Commission must approve or disapprove the
Authority's proposed rule or modification. To ensure it has sufficient
time for review, the Commission is requiring the Authority to provide
the information it needs to evaluate the Authority's proposed rule or
modification at least 90 days in advance of the date the Authority
proposes having its proposed rule or modification published in the
Federal Register for public comment. This will give the Commission
additional time to evaluate the Authority's proposed rule or
modification. It should be noted this 90-day timeframe serves as a
minimum, not a maximum, timeframe. The Secretary may shorten the
timeframe if the Authority demonstrates that a shorter timeframe is
necessary to meet statutory deadlines.
E. Conclusory Statements and Failure To Provide Requisite Analysis
The Authority must provide an adequate basis for the Commission's
review of its rules. The Commission seeks to understand the Authority's
analysis of the information it relied on to determine whether a
proposed rule or modification was warranted and if so, what provisions
the rule should contain. To this end, the information required under
this section must be sufficiently detailed and contain sufficient
analysis to support a Commission finding that a proposed rule or
modification satisfies the statutory requirements. A mere assertion or
conclusory statement that a proposed rule or modification is consistent
with the requirements of the Act, for instance, is insufficient. If the
Authority fails to describe and justify the proposed rule or
modification in the manner described in this section, or fails to
submit the information required by this section, the Commission may not
have sufficient information to make an affirmative finding that the
proposed rule or modification is consistent with the Act and the
applicable rules approved by the Commission.
F. Public Comments
Section 4(d)(2) of the Act, 15 U.S.C. 3053(d)(2), provides the
``Commission shall publish in the Federal Register any [ ] proposed
rule, standard, or procedure and provide an opportunity for public
comment.'' However, the Act gives the Commission only a total of 60
days after publication to approve or disapprove a proposed rule or
modification once it has been published in the Federal Register. Given
that the Commission and the Authority will need time to review
comments, the Act functionally provides for a much more limited comment
period of approximately 30 days or less. To ensure the public has an
adequate opportunity to review and understand the Authority's rules,
ask questions, and provide comments, the Commission is encouraging the
Authority to make its proposed rules publicly available and solicit
public comments in advance of providing any submissions to the
Commission. To avoid delays in Commission approval of its rules, the
Authority should not wait until its proposed rule is published in the
Federal Register to solicit its own public comments.
In a March 21, 2021 letter \2\ to the Acting Chairwoman, Rebecca
Kelly Slaughter, the Act's sponsors stated ``[t]he relationship between
the [Commission] and the Authority is closely modeled on the enduring
and effective relationship between the Securities and Exchange
Commission (SEC) and Financial Industry Regulatory Authority (FINRA), a
private self-regulatory organization.'' As part of its own rulemaking
process, the FINRA Board of Governors may authorize the publication of
its own Regulatory Notice soliciting comments on a rule proposal prior
to its submission to the SEC.\3\ If FINRA decides to issue a Regulatory
Notice soliciting public comment on a proposal, the comment period
typically is open for one to two months.\4\ All comments become part of
FINRA's ``official record'' of the rule proposal, and since December 1,
2003, FINRA has posted all comment letters on its website.\5\ Depending
on the comments received in response to the Regulatory Notice and any
changes made to the proposal, FINRA staff will either return to the
FINRA Board with a revised proposal or will file the rule proposal with
the SEC for notice and comment.\6\ Soliciting comments, as FINRA does,
in advance of submitting any proposed rules or modifications to the
Commission would benefit both the Authority, the regulated community,
and the Commission. It would provide transparency and enable the
Authority to resolve any issues with its rules prior to their
submission to the Commission.
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\2\ See Letter from Senator Mitch McConnell to Acting Chairwoman
Rebecca Kelly Slaughter (Mar. 23, 2021) (on file with the Federal
Trade Commission).
\3\ See FINRA Rulemaking process, https://www.finra.org/rules-guidance/rulemaking-process (last visited July 9, 2021).
\4\ Id.
\5\ Id.
\6\ Id.
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If public comments are solicited, the Commission is requiring the
Authority to attach, as an exhibit to its submission under Sec. 1.142,
a copy of the comments. The Commission encourages the Authority to make
such comments publicly available on its own website. In
[[Page 54823]]
addition, the Authority's draft Federal Register document must include
a summary of the substance of all comments received and the Authority's
written response to all significant issues raised in such comments.
This advance resolution of comments will greatly facilitate the process
of review of any proposed rules or modifications the Authority submits
to the Commission.
IV. Section 1.143--Submissions to the Secretary
This section provides guidance for the Authority when submitting
documents to the Secretary of the Commission.
All rule submissions made pursuant to Sec. 1.142 and 15 U.S.C.
3053(a), rate increases which must be reported to the Commission under
15 U.S.C. 3052(f)(1)(C)(iv), or HISA Guidance which must be submitted
to the Commission under 15 U.S.C. 3054(g)(2), must be emailed to the
Secretary of the Commission at [email protected]. The subject
line of the email must state: ``HISA Rule Submission,'' ``HISA Rate
Increase Submission,'' or ``HISA Guidance Submission'' as applicable.
This will enable the Secretary to easily identify submissions from the
Authority and route them to the appropriate office.
To facilitate Commission review, documents must be organized and
sent in a format that will facilitate the submission of documents to
the Office of the Federal Register. Except for supporting documentation
submitted pursuant to Sec. 1.142(b) (existing standards used as a
reference for the development of the proposed rule or modification, and
scientific data, studies, or analysis underlying the development of the
proposed rule or modification) and copies of public comments submitted
pursuant to Sec. 1.142(f), all documents submitted to the Secretary
must be in a word processing format. This will enable the Commission to
more easily make modifications to Federal Register documents, provide
feedback on rule text, and draft orders. For organizational purposes,
the Commission is requiring submissions with more than one attachment
to contain a table of contents in the body of the email with a brief
description of each item. The Authority must also provide the contact
information for a person on the staff of the Authority responsible for
responding to questions from the Commission. To facilitate submissions
to the Office of the Federal Register, the Commission is requiring that
the Authority's draft Federal Register documents follow the relevant
format and editorial requirements for regulatory documents in the
Office of Federal Register's Document Drafting Handbook, 1 CFR parts
18, 21, and 22. Specifically, draft Federal Register documents must
contain proper preamble captions and content; state the purpose of, and
basis for, the proposed rule or modification; set forth regulatory
text, headings, and authority citations; use correct numbering,
structure, and amendatory language; and conform to style and formatting
established by the Office of the Federal Register and Government
Publishing Office (see, specifically, section 2.17 (proposed rules) of
the Office of the Federal Register's Document Drafting Handbook).
If a document filed with the Secretary contains confidential
information, the Secretary must be so informed, and a request for
confidential treatment must be submitted in accordance with 16 CFR 4.9.
Filings submitted electronically on or before 5:30 p.m. Eastern Time,
on a business day, will be deemed filed on that business day, and all
filings submitted after 5:30 p.m. Eastern Time, will be deemed filed on
the next business day. This section also provides the Secretary of the
Commission may reject a document for filing that fails to comply with
the Commission's rules for filing in this section or Sec. 1.142.
Finally, if the conditions in this section and Sec. 1.142 have been
satisfied, the Commission will publish the proposed rules or
modifications in the Federal Register for public comment.
V. Section 1.144--Approval or Disapproval of Proposed Rules or
Modifications
Section 4(c)(1) of the Act, 15 U.S.C. 3053(c)(1) provides, ``Not
later than 60 days after the date on which a proposed rule or
modification is published in the Federal Register, the Commission shall
approve or disapprove the proposed rule or modification.'' In addition,
Section 4(c)(2) of the Act, 15 U.S.C. 3053(c)(2), provides ``[t]he
Commission shall approve a proposed rule or modification if the
Commission finds that the proposed rule or modification is consistent
with [ ] this chapter; and [ ] applicable rules approved by the
Commission.'' Accordingly, Sec. 1.144 provides the Commission will
approve or disapprove a proposed rule or modification by issuing an
order within 60 days of the date the proposed rule or modification was
published in the Federal Register for public comment. The Commission
will approve a proposed rule or modification if it finds such proposed
rule or modification is consistent with the Act and the applicable
rules approved by the Commission. Further, a proposed rule or
modification will not take effect unless it has been approved by the
Commission.
Because these rule revisions relate solely to agency procedure and
practice, publication for notice and comment is not required under the
Administrative Procedure Act. 5 U.S.C. 553(b).\7\
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\7\ For this reason, the requirements of the Regulatory
Flexibility Act are also inapplicable. 5 U.S.C. 601(2), 604(a).
Likewise, the amendments do not modify any FTC collections of
information within the meaning of the Paperwork Reduction Act. 44
U.S.C. 3501 et seq.
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List of Subjects in 16 CFR Part 1
Administrative practice and procedure.
For the reasons set forth in the preamble, the Federal Trade
Commission amends title 16, chapter I, subchapter A of the Code of
Federal Regulations as follows:
PART 1--GENERAL PROCEDURES
0
1. The authority citation for part 1 continues to read as follows:
Authority: 15 U.S.C. 46; 15 U.S.C. 57a; 5 U.S.C. 552; 5 U.S.C.
601 note.
0
2. Add subpart S to read as follows:
Subpart S--Procedures for Submissions Under the Horseracing
Integrity and Safety Act
Sec.
1.140 Definitions.
1.141 Required submissions.
1.142 Submission of proposed rule or modification.
1.143 Submissions to the Secretary.
1.144 Approval or disapproval of proposed rules and proposed rule
modifications.
Authority: 15 U.S.C. 3053.
Sec. 1.140 Definitions.
When used in relation to the Horseracing Integrity and Safety Act,
15 U.S.C. 3051 through 3060, and this subpart--
Act means the Horseracing Integrity and Safety Act, 15 U.S.C. 3051
through 3060.
Breeder means a person who is in the business of breeding covered
horses.
Commission means the Federal Trade Commission.
Covered horse means any Thoroughbred horse, or any other horse made
subject to the Act by election of the applicable State racing
commission or the breed governing organization for such horse under 15
U.S.C. 3054(l), during the period--
(1) Beginning on the date of the horse's first timed and reported
workout at a racetrack that participates in covered horseraces or at a
training facility; and
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(2) Ending on the date on which the Authority receives written
notice that the horse has been retired.
Covered horserace means any horserace involving covered horses that
has a substantial relation to interstate commerce, including any
Thoroughbred horserace that is the subject of interstate off-track or
advance deposit wagers.
Covered persons means all trainers, owners, breeders, jockeys,
racetracks, veterinarians, persons (legal and natural) licensed by a
State racing commission and the agents, assigns, and employees of such
persons and other horse support personnel who are engaged in the care,
training, or racing of covered horses.
HISA Guidance means Horseracing Integrity and Safety Authority
(Authority) guidance issued under 15 U.S.C. 3054(g)(1), which does not
have the force of law.
Horseracing anti-doping and medication control program means the
anti-doping and medication program established under 15 U.S.C. 3055(a).
Horseracing Integrity and Safety Authority or Authority means the
private, independent, self-regulatory, nonprofit corporation recognized
for purposes of developing and implementing a horseracing anti-doping
and medication control program and a racetrack safety program for
covered horses, covered persons, and covered horseraces.
Interstate off-track wager has the meaning given such term in
Section 3 of the Interstate Horseracing Act of 1978, 15 U.S.C. 3002.
Jockey means a rider or driver of a covered horse in covered
horseraces.
Owner means a person who holds an ownership interest in one or more
covered horses.
Proposed rule means any rule proposed by the Authority pursuant to
the Act.
Proposed rule modification or modification means:
(1) Any proposed modification to a rule or proposed rule change; or
(2) Any interpretation or statement of policy or practice relating
to an existing rule of the Authority that is not HISA Guidance and
would have the force of law if approved as a final rule.
Racetrack means an organization licensed by a State racing
commission to conduct covered horseraces.
Racetrack safety program means the program established under 15
U.S.C. 3056(a).
State racing commission means an entity designated by State law or
regulation that has jurisdiction over the conduct of horseracing within
the applicable State.
Trainer means an individual engaged in the training of covered
horses.
Training facility means a location that is not a racetrack licensed
by a State racing commission that operates primarily to house covered
horses and conduct official timed workouts.
Veterinarian means a licensed veterinarian who provides veterinary
services to covered horses.
Workout means a timed running of a horse over a predetermined
distance not associated with a race or its first qualifying race, if
such race is made subject to the Act by election under 15 U.S.C.
3054(l) of the horse's breed governing organization or the applicable
State racing commission.
Sec. 1.141 Required submissions.
The Authority must submit to the Commission any proposed rule, or
proposed rule modification, of the Authority relating to--
(a) The bylaws of the Authority;
(b) A list of permitted and prohibited medications, substances, and
methods, including allowable limits of permitted medications,
substances, and methods;
(c) Laboratory standards for accreditation and protocols;
(d) Standards for racing surface quality maintenance;
(e) Racetrack safety standards and protocols;
(f) A program for injury and fatality data analysis;
(g) A program of research and education on safety, performance, and
anti-doping and medication control;
(h) A description of safety, performance, and anti-doping and
medication control rule violations applicable to covered horses and
covered persons;
(i) A schedule of civil sanctions for violations;
(j) A process or procedures for disciplinary hearings;
(k) A formula or methodology for determining assessments described
in 15 U.S.C. 3052(f); and
(l) Any other proposed rule or modification the Act requires the
Authority to submit to the Commission for approval.
Sec. 1.142 Submission of proposed rule or modification.
(a) Contents of submission. In order for a submission to qualify as
a proposed rule or proposed rule modification under 15 U.S.C. 3053(a),
the Authority must submit to the Commission a complete draft of the
Federal Register document for the proposed rule or proposed rule
modification, which includes the text of the rule and a statement of
the purpose of, and statutory basis for, the proposed rule or
modification (``statement of basis and purpose''). The statement of
basis and purpose must contain:
(1) The reasons for adopting the proposed rule or modification.
(2) Any problems the proposed rule or modification is intended to
address and how the proposed rule or modification will resolve those
problems.
(3) A description of any reasonable alternatives to the proposed
rule or modification that may accomplish the stated objective and an
explanation of the reasons the Authority chose the proposed rule or
modification over its alternatives.
(4) How the proposed rule or modification will affect covered
persons, covered horses, and covered horseraces.
(5) Why the proposed rule or modification is consistent with the
requirements of the Act and any rules and regulations applicable to the
Authority, including the following:
(i) Anti-doping and medication control program. When proposing a
rule or modification to the horseracing anti-doping and medication
control program, the Authority must explain how it considered the
factors in 15 U.S.C. 3055, including:
(A) Under 15 U.S.C. 3055(a)(2), the unique characteristics of a
breed of horse made subject to the Act by election of a State racing
commission or breed governing organization for such horse pursuant to
15 U.S.C. 3054(l);
(B) The factors listed in 15 U.S.C. 3055(b); and
(C) The baseline anti-doping and medication control rules
identified in 15 U.S.C. 3055(g)(2)(A). For a proposed rule, the
Authority must state whether its proposed rule adopts the baseline
standards identified in 15 U.S.C. 3055(g)(2)(A). If there is a conflict
in any baseline standards identified in 15 U.S.C. 3055(g)(2)(A), the
Authority must identify the conflict and state whether the standard it
adopted is the most stringent standard. For a proposed rule
modification, the Authority must explain whether the modification
renders an anti-doping and medication control rule less stringent than
the baseline anti-doping and medication control rules described in 15
U.S.C. 3055(g)(2)(A), and state whether the anti-doping and medication
control enforcement agency has approved of the change.
(ii) Racetrack safety program. When proposing a rule or
modification to any rule regarding the racetrack safety program
required under 15 U.S.C. 3056(a)(1), the Authority must explain how the
proposed rule or modification
[[Page 54825]]
meets the requirements in 15 U.S.C. 3056(b). The Authority must explain
how it considered and whether it adopted the safety standards in 15
U.S.C. 3056(a)(2). If any horseracing safety standards in 15 U.S.C.
3056(a)(2) were considered but not adopted or were modified, the
Authority must explain why it decided not to adopt or why it decided to
modify such standard.
(iii) Other rules. To the extent the Act requires the Authority to
consider any factors or standards not specifically referenced in this
section, the Authority must explain whether and how it considered those
factors when proposing a rule or modification. For instance, when
proposing a civil sanctions rule or modification pursuant to 15 U.S.C.
3057(d)(1), the Authority must explain how the rule or modification
meets the requirements of 15 U.S.C. 3057(d)(2).
(6) If written comments were solicited, the Authority's draft
Federal Register document must include a summary of the substance of
all comments received and the Authority's written response to all
significant issues raised in such comments.
(7) The date that the Authority proposes for the Federal Register
to publish its proposed rule or modification.
(b) Supporting documentation. The Authority's submission to the
Commission required under paragraph (a) of this section must also
include copies of the pertinent factual information underlying the
Authority's development of the proposed rule or modification, including
a copy of existing standards used as a reference for the development of
the proposed rule or modification and scientific data, studies, or
analysis underlying the development of the proposed rule or
modification. Supporting documentation must be attached as exhibits,
and each exhibit must clearly identify the proposed rule or
modification it supports.
(c) Redline document for proposed rule modification. For proposed
rule modifications, the Authority must also provide, in a document
separate from the Federal Register document, a redline version of the
existing rule that will enable the Commission to immediately identify
any proposed changes.
(d) Timing of submission. To qualify as a proposed rule or proposed
modification under 15 U.S.C. 3053(a), the Authority's submission must
provide the information in paragraphs (a), (b), and (c) of this section
at least 90 days in advance of the proposed date for the Federal
Register to publish a proposed rule or modification for public comment
pursuant to 15 U.S.C. 3053(b)(1). The Secretary may waive the 90-day
requirement in this section if the Authority demonstrates such waiver
is necessary to meet statutory deadlines.
(e) Conclusory statements and failure to provide requisite
analysis. Information required to be submitted under this section must
be sufficiently detailed and contain sufficient analysis to support a
Commission finding that a proposed rule or modification satisfies the
statutory requirements. For instance, a mere assertion or conclusory
statement that a proposed rule or modification is consistent with the
requirements of the Act is insufficient. Failure to describe and
justify the proposed rule or modification in the manner described in
this section or failure to submit the information required by this
section may result in the Commission's having insufficient information
to make an affirmative finding that the proposed rule or modification
is consistent with the Act and the applicable rules approved by the
Commission.
(f) Public comments. The Authority is encouraged to solicit public
comments on its proposed rule or modification in advance of making a
submission to the Commission pursuant to this section. If the Authority
solicits public comments, it must attach a copy of the comments as an
exhibit to its submission. By soliciting public comments and addressing
significant issues raised therein, the Authority facilitates the
Commission's review and approval of the Authority's proposed rule or
modification.
Sec. 1.143 Submissions to the Secretary.
(a) Electronic submission. All rule submissions under Sec. 1.142
and 15 U.S.C. 3053(a), rate increases that must be reported to the
Commission under 15 U.S.C. 3052(f)(1)(C)(iv), or HISA Guidance that
must be submitted to the Commission under 15 U.S.C. 3054(g)(2) must be
emailed to the Secretary of the Commission at
[email protected]. The subject line of the email must state:
``HISA Rule Submission,'' ``HISA Rate Increase Submission,'' or ``HISA
Guidance Submission,'' as applicable.
(b) Format for submission of proposed rules or modifications--(1)
Electronic format. Except for supporting documentation submitted
pursuant to Sec. 1.142(b) and copies of comments submitted pursuant to
Sec. 1.142(f), all documents submitted to the Secretary must be in a
word processing format.
(2) Table of contents. Submissions with more than one attachment
must contain a table of contents in the body of the email with a brief
description of each item.
(3) Contact information. The Authority must provide the name,
telephone number, and email address of a person on the staff of the
Authority responsible for responding to questions and comments on the
submission in the body of the email.
(4) Draft Federal Register documents. Draft Federal Register
documents must follow the relevant format and editorial requirements
for regulatory documents under 1 CFR parts 18, 21, and 22 (see Office
of Federal Register's Document Drafting Handbook). The Document
Drafting Handbook specifies that draft Federal Register documents (see
1 CFR 15.10) must:
(i) Contain proper preamble captions and content;
(ii) State the purpose of, and basis for, the proposed rule or
modification;
(iii) Set forth regulatory text, headings, and authority citations;
(iv) Use correct numbering, structure, and amendatory language; and
(v) Conform to the style and formatting established by the Office
of the Federal Register and Government Publishing Office. (See,
specifically, section 2.17 (proposed rules) of the Office of the
Federal Register's Document Drafting Handbook.)
(c) Confidential information. If a document filed with the
Secretary contains confidential information, the Secretary must be so
informed, and a request for confidential treatment must be submitted in
accordance with 16 CFR 4.9.
(d) Date of filing. If the conditions of this section are otherwise
satisfied, all filings submitted electronically on or before 5:30 p.m.
Eastern Time, on a business day, will be deemed filed on that business
day, and all filings submitted after 5:30 p.m. Eastern Time, will be
deemed filed on the next business day.
(e) Authority to reject documents for filing. The Secretary of the
Commission may reject a document for filing that fails to comply with
the Commission's rules for filing in this section or Sec. 1.142.
(f) Federal Register publication. If the conditions in this section
and Sec. 1.142 have been satisfied, the Commission will publish the
proposed rules or modifications in the Federal Register and request
public comment on those proposed rules or modifications.
Sec. 1.144 Approval or disapproval of proposed rules and proposed
rule modifications.
(a) Commission decision. The Commission will approve or disapprove
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a proposed rule or modification by issuing an order within 60 days of
the date the proposed rule or modification was published in the Federal
Register for public comment.
(b) Standard of review. The Commission will approve a proposed rule
or modification if the Commission finds that the proposed rule or
modification is consistent with the Act and the applicable rules
approved by the Commission. If the Commission disapproves a rule or
modification, it will make recommendations to the Authority to modify
the proposed rule or modification within 30 days of such disapproval.
(c) Effect. A proposed rule or modification will not take effect
unless it has been approved by the Commission.
By direction of the Commission.
April J. Tabor,
Secretary.
[FR Doc. 2021-21306 Filed 10-4-21; 8:45 am]
BILLING CODE 6750-01-P
