[Federal Register Volume 76, Number 41 (Wednesday, March 2, 2011)]
[Notices]
[Pages 11545-11547]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-4692]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63962; File No. SR-MSRB-2011-05]
Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Notice of Filing and Immediate Effectiveness of Amendments to
Rule A-15, on Notification To Board of Termination of Municipal
Securities Activities and Change of Name or Address
February 24, 2011.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on February 14, 2011, the Municipal Securities Rulemaking Board
(``Board'' or ``MSRB'') filed with the Securities and Exchange
Commission (``SEC'' or ``Commission'') the proposed rule change as
described in Items I, II, and III below, which Items have been prepared
by the MSRB. The MSRB has filed the proposal as a ``non-controversial''
rule change pursuant to Section 19(b)(3)(A)(iii) of the Act,\3\ and
Rule 19b-4(f)(6) thereunder,\4\ which renders the proposal effective
upon filing with the Commission. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b4-(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The MSRB is filing a proposed rule change relating to the
notification requirements in the event of a change in status of a
broker, dealer, municipal securities dealer, or municipal advisor,
consisting of amendments to Rule A-15, on Notification to Board of
Termination of Municipal Securities Activities and Change of Name or
Address.
The text of the proposed rule change is available on the MSRB's
website at http://www.msrb.org/Rules-and-Interpretations/SEC-Filings/2011-Filings.aspx, at the MSRB's principal office, and at the
Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the MSRB included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Board has prepared summaries, set forth in Sections
A, B, and C below, of the most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purposes of the proposed rule change are: (i) To extend the
provisions of Rule A-15 to municipal advisors; and (ii) to expand the
circumstances under which the MSRB must be notified to include: (A) a
bar or suspension from engaging in municipal securities activities or
municipal advisory activities by the appropriate regulatory agency,
judicial authority, or otherwise; and (B) in the case of a broker,
dealer, or municipal securities dealer, expulsion or suspension from
membership or participation in a national securities exchange or
registered securities association. Although existing Rule A-15
establishes a procedure for notification of a change in status with
respect to brokers, dealers and municipal securities dealers, it does
not apply to municipal advisors. Further, existing Rule A-15 does not
provide for notification to the Board in the event of disbarment or
suspension by regulatory agencies or judicial authorities or otherwise,
or, with respect to brokers, dealers and municipal securities dealers,
expulsion or suspension from membership or participation in a national
securities exchange or registered securities association. The proposed
rule change (i) adds municipal advisors to the entities subject to the
rule; (ii) requires notification if (A) a broker, dealer, municipal
securities dealer, or municipal advisor has been barred or suspended
from engaging in municipal securities activities or municipal advisory
activities by the appropriate regulatory agency, judicial authority or
otherwise; and (B) if a broker, dealer or municipal securities dealer
has been expelled or suspended from membership or participation in a
national securities exchange or registered securities association.
2. Statutory Basis
The MSRB believes that the proposed rule change is consistent with
Section 15B(b)(2) of the Act, which provides that:
The Board shall propose and adopt rules to effect the purposes
of this title with respect
[[Page 11546]]
to transactions in municipal securities effected by brokers,
dealers, and municipal securities dealers and advice provided to or
on behalf of municipal entities or obligated persons by brokers,
dealers, municipal securities dealers, and municipal advisors with
respect to municipal financial products, the issuance of municipal
securities, and solicitations of municipal entities or obligated
persons undertaken by brokers, dealers, municipal securities
dealers, and municipal advisors;
and, in particular, Section 15B(b)(2)(C) of the Act, which provides, in
pertinent part, that MSRB rules shall:
be designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to
foster cooperation and coordination with persons engaged in
regulating, clearing, settling, processing information with respect
to, and facilitating transactions in municipal securities and
municipal financial products, to remove impediments to and perfect
the mechanism of a free and open market in municipal securities and
municipal financial products, and, in general, to protect investors,
municipal entities, obligated persons, and the public interest * *
*.
The proposed rule change is consistent with Section 15B(b)(2) and
Section 15B(b)(2)(C) of the Act because it will assist the Board in
monitoring which brokers, dealers, municipal securities dealers, and
municipal advisors should no longer be listed as MSRB registrants and,
accordingly, will aid investors, municipal entities, obligated persons,
and the public in their choice of brokers, dealers, municipal
securities dealers, and municipal advisors.
Section 15B(2)(L)(iv) of the Act requires that rules adopted by the
Board
not impose a regulatory burden on small municipal advisors that is
not necessary or appropriate in the public interest and for the
protection of investors, municipal entities, and obligated persons,
provided that there is robust protection of investors against fraud.
The proposed rule change does not impose a regulatory burden on
small municipal advisors that is not necessary or appropriate in the
public interest and for the protection of investors, municipal
entities, and obligated persons and for the robust protection of
investors against fraud. Rule A-15, as amended by the proposed rule
change, requires that municipal advisors submit a notice indicating
their change in status. The MSRB expects that municipal advisors will
need no more than 30 minutes to complete the notification required by
the proposed rule change, and such notice may be submitted by email or
fax, as well as by regular mail or overnight delivery service. The MSRB
will have staff ready to assist municipal advisors should they have any
questions. The proposed rule change does not impose any additional fee
on municipal advisors but only requires payment of any amounts
otherwise due and owing under other rules of the Board. Any burden on
municipal advisors is de minimis. The proposed rule change is necessary
to aid the Board in monitoring which brokers, dealers, municipal
securities dealers, and municipal advisors should no longer be listed
as MSRB registrants and, accordingly, will aid investors, municipal
entities, obligated persons, and the public by providing information to
inform their choice of broker, dealer, municipal securities dealer, or
municipal advisor.
B. Self-Regulatory Organization's Statement on Burden on Competition
The MSRB does not believe that the proposed rule change will impose
any burden on competition not necessary or appropriate in furtherance
of the purposes of the Act, since it would apply equally to all
brokers, dealers, municipal securities dealers and municipal advisors.
C. Self-Regulatory Organization's Statement on Comments Received on the
Proposed Rule Change by Members, Participants, or Others
Written comments were neither solicited nor received on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The MSRB represented that the proposed rule change qualifies for
immediate effectiveness pursuant to Section 19(b)(3)(A)(iii) of the Act
\5\ thereunder, because it: (i) Does not significantly affect the
protection of investors or the public interest; (ii) does not impose
any significant burden on competition; and (iii) does not become
operative for 30 days after filing or such shorter time as the
Commission may designate consistent with the protection of investors
and the public interest.\6\
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\5\ 15 U.S.C. 78s(b)(3)(A).
\6\ In addition, Rule 19b-4(f)(6)(iii) requires a self-
regulatory organization to give the Commission written notice of its
intent to file the proposed rule change at least five business days
prior to the date of filing of the proposed rule change, or such
shorter time as designated by the Commission.
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The MSRB provided the required written notice of its intention to
file the proposed rule change to the Commission on February 3, 2011,
and the proposed rule change will become operative on March 17, 2011,
which is more than 30 days after the filing of the proposed rule
change.
At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.\7\
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\7\ See Section 19(b)(3)(C) of the Act, 15 U.S.C. 78s(b)(3)(C).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an e-mail to [email protected]. Please include
File Number SR-MSRB-2011-05 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-MSRB-2011-05. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Web site (http://www.sec.gov/rules/sro.shtml). Copies
of the submission, all subsequent amendments, all written statements
with respect to the proposed rule change that are filed with the
Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for Web site viewing and printing in
the Commission's Public Reference Room, 100 F Street, NE., Washington,
DC 20549, on official business days between the hours of 10 a.m. and 3
p.m. Copies of such filing also will be available for inspection and
copying at the MSRB's offices. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You
[[Page 11547]]
should submit only information that you wish to make available
publicly. All submissions should refer to File Number SR-MSRB-2011-05
and should be submitted on or before March 23, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
Cathy H. Ahn,
Deputy Secretary.
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\8\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 2011-4692 Filed 3-1-11; 8:45 am]
BILLING CODE 8011-01-P