[Federal Register Volume 74, Number 62 (Thursday, April 2, 2009)]
[Notices]
[Pages 15190-15213]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-7340]



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Part III





Securities and Exchange Commission





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Self-Regulatory Organizations; Municipal Securities Rulemaking Board; 
Notice of Filing of Proposed Rule Change Relating to the Establishment 
of a Primary Market Disclosure Service and Trade Price Transparency 
Service of the Electronic Municipal Market Access System (EMMA[supreg]) 
and Amendments to MSRB Rules G-32 and G-36; Notice

Federal Register / Vol. 74 , No. 62 / Thursday, April 2, 2009 / 
Notices

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59636; File No. SR-MSRB-2009-02]


Self-Regulatory Organizations; Municipal Securities Rulemaking 
Board; Notice of Filing of Proposed Rule Change Relating to the 
Establishment of a Primary Market Disclosure Service and Trade Price 
Transparency Service of the Electronic Municipal Market Access System 
(EMMA[supreg]) and Amendments to MSRB Rules G-32 and G-36

March 27, 2009.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on March 23, 2009, the Municipal Securities Rulemaking Board (``MSRB'') 
filed with the Securities and Exchange Commission (``Commission'' or 
``SEC'') the proposed rule change as described in Items I, II, and III 
below, which Items have been substantially prepared by the MSRB. 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.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The MSRB has filed with the Commission a proposed rule change to 
implement an electronic system for free public access to primary market 
disclosure documents and transaction price information for the 
municipal securities market through the MSRB's Electronic Municipal 
Market Access system (``EMMA''). The proposed rule change would: (i) 
Establish EMMA's permanent primary market disclosure service (the 
``primary market disclosure service'') for electronic submission and 
public availability on EMMA's Internet portal (the ``EMMA portal'') of 
official statements, advance refunding documents and related primary 
market documents and information (the ``EMMA primary market disclosure 
proposal''); (ii) establish EMMA's permanent transparency service (the 
``trade price transparency service'') making municipal securities 
transaction price data publicly available on the EMMA portal (the 
``EMMA trade price transparency proposal''); (iii) establish a real-
time subscription to the primary market document collection (the 
``primary market disclosure subscription proposal''); (iv) terminate 
the existing pilot EMMA facility of the Municipal Securities 
Information Library (MSIL) system (the ``primary market pilot'') and 
suspend submissions of official statements, advance refunding documents 
and Forms G-36(OS) and G-36(ARD) to the MSIL system (the ``system 
transition proposal'') and (v) amend and consolidate current Rules G-32 
and G-36 into new Rule G-32 on disclosures in connection with primary 
offerings, replace current Forms G-36(OS) and G-36(ARD) with new Form 
G-32, provide transitional submission requirements, and amend certain 
related recordkeeping requirements, to establish an ``access equals 
delivery'' standard for electronic official statement dissemination in 
the municipal securities market (the ``rule change proposal'').
    The MSRB has requested approval to commence operation of EMMA's 
primary market disclosure service and trade price transparency service 
on a permanent basis, and to make the provisions of the rule change 
proposal effective, on the later of (i) May 11, 2009 or (ii) the date 
announced by the MSRB in a notice published on the MSRB Web site, which 
date shall be no earlier than ten business days after Commission 
approval of the proposed rule change and shall be announced no fewer 
than five business days prior to such date (the ``effective date'').
    The text of the proposed rule change is available on the MSRB's Web 
site (http://www.msrb.org/msrb1/sec.asp), 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 MSRB 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 proposed rule change would implement an electronic system for 
free public access to primary market disclosure documents and 
transaction price information for the municipal securities market. The 
proposed rule change consists of: (i) The EMMA primary market 
disclosure proposal to provide for electronic submission and public 
availability on the EMMA portal of official statements, certain 
preliminary official statements, advance refunding documents and 
amendments thereto (``primary market disclosure documents''), together 
with related information; (ii) the EMMA trade price transparency 
proposal to make municipal securities transaction price data publicly 
available on the EMMA portal; (iii) the primary market disclosure 
subscription proposal to establish a real-time subscription to the 
primary market disclosure document collection; (iv) the system 
transition proposal to terminate the existing primary market pilot and 
suspend submissions to the MSIL system; and (v) the rule change 
proposal to amend and consolidate MSRB rules on official statement 
deliveries to establish an ``access equals delivery'' standard for 
electronic official statement dissemination in the municipal securities 
market.
    Existing primary market disclosure document delivery requirements 
under MSRB rules are described briefly below, followed by a discussion 
of each of these proposals.
Current Delivery Requirements
    Under current Rule G-32, a broker, dealer or municipal securities 
dealer (``dealer'') selling a new issue municipal security to a 
customer during the period ending 25 days after bond closing (the ``new 
issue disclosure period'') must, with certain limited exceptions, 
deliver the official statement to the customer on or prior to trade 
settlement. In cases where an official statement is not produced by the 
issuer, the dealer is required to instead provide a preliminary 
official statement, if available. The dealer also must provide certain 
additional information about the underwriting (including initial 
offering prices and information about underwriter compensation) if the 
issue was purchased by the underwriter in a negotiated sale. These 
additional items of information typically are disclosed in the official 
statement but must be provided separately by the selling dealer if not 
included in the official statement. Furthermore, selling dealers and 
the managing underwriter must send official statements to purchasing 
dealers promptly upon request, and dealer financial advisors that 
prepare the official statement must provide such official statement to 
the managing underwriter promptly.

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    Current Rule G-36 requires dealers acting as underwriters, 
placement agents or remarketing agents for primary offerings of 
municipal securities (``underwriters'') to submit official statements, 
accompanied by Form G-36(OS), for most primary offerings of municipal 
securities to the MSRB. For offerings subject to Exchange Act Rule 
15c2-12, the official statement must be sent within one business day 
after receipt from the issuer but no later than ten business days after 
the bond sale. With limited exceptions, official statements prepared 
for any other offerings must be sent by the later of one business day 
after receipt from the issuer or one business day after bond closing. 
Amendments to the official statement during the new issue disclosure 
period also must be submitted to the MSRB. In addition, if the offering 
is an advance refunding and an advance refunding document has been 
prepared, the advance refunding document and Form G-36(ARD) must be 
sent by the underwriter to the MSRB within five business days after 
bond closing. Official statements and advance refunding documents may 
currently be submitted in either paper or electronic format. These 
submissions are collected by the Municipal Securities Information 
Library (MSIL) system into a comprehensive library. The MSRB makes 
these documents available to paid subscribers as portable document 
format (PDF) files on a compact disk sent daily to subscribers, and 
also makes them available to the public, subject to copying charges, at 
the MSRB's public access facility in Alexandria, Virginia.
Description of the EMMA Primary Market Disclosure Proposal
    The EMMA primary market disclosure proposal would establish, as a 
component of EMMA, the EMMA primary market disclosure service for the 
receipt of, and for making available to the public of, official 
statements, preliminary official statements and advance refunding 
documents, including amendments thereto (collectively, ``primary market 
disclosure documents''), and related information, to be submitted by or 
on behalf of underwriters under revised Rule G-32, as proposed in the 
rule change proposal described below.\3\ As proposed, all primary 
market disclosure documents would be submitted to the MSRB, free of 
charge, through an Internet-based electronic submitter interface or 
electronic computer-to-computer data connection, at the election of the 
submitter. Public access to the documents and information would be 
provided through the EMMA primary market disclosure service on the 
Internet through the EMMA portal at no charge as well as through a paid 
real-time data stream subscription service.\4\ In connection with each 
primary offering for which information is required to be submitted to 
EMMA pursuant to revised Rule G-32, the submitter would provide, at the 
time of submission, information required to be included on new Form G-
32. The items of information to be included on new Form G-32 and the 
timing requirements for providing such information are set forth in the 
description of the rule change proposal below.
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    \3\ EMMA was originally established, and began operation on 
March 31, 2008, as a complementary pilot facility of the MSRB's 
existing Official Statement and Advance Refunding Document (OS/ARD) 
system of the MSIL system. See Securities Exchange Act Release No. 
57577 (March 28, 2008), 73 FR 18022 (April 2, 2008) (File No. SR-
MSRB-2007-06) (approving operation of the EMMA pilot to provide free 
public access to the MSIL system collection of official statements 
and advance refunding documents and to the MSRB's Real-Time 
Transaction Reporting System historical and real-time transaction 
price data) (the ``Pilot Filing''). The pilot EMMA facility would be 
replaced, and EMMA would become a permanent facility of the MSRB, by 
the establishment of the EMMA primary market disclosure service and 
EMMA trade price transparency service proposed in this filing, 
together with such other EMMA services established by the MSRB from 
time to time. See Securities Exchange Act Release No. 59061 
(December 5, 2008), 73 FR 75778 (December 12, 2008) (File No. SR-
MSRB-2008-05) (approving the continuing disclosure service of EMMA 
with an effective date of July 1, 2009). See also Securities 
Exchange Act Release No.59212 (January 7, 2009), 74 FR 1741 (January 
13, 2009) (File No. SR-MSRB-2008-07) (approving the establishment of 
the short-term obligation rate transparency service of EMMA). 
Although the MSIL system would no longer accept and process 
submissions by underwriters upon establishment of the EMMA primary 
market disclosure service as provided in the system transition 
proposal, it would continue to operate for a period of time 
primarily to serve certain internal MSRB functions.
    \4\ The pilot EMMA portal currently is accessible at http://www.emma.msrb.org.
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    The MSRB proposes that submissions of primary market disclosure 
documents to the EMMA primary market disclosure service be made as 
portable document format (PDF) files configured to permit documents to 
be saved, viewed, printed and retransmitted by electronic means. If the 
submitted file is a reproduction of the original document, the 
submitted file must maintain the graphical and textual integrity of the 
original document. For any document submitted to the EMMA primary 
market disclosure service on or after January 1, 2010, such PDF file 
must be word-searchable (that is, allowing the user to search for 
specific terms used within the document through a search or find 
function available in most standard software packages), provided that 
diagrams, images and other non-textual elements would not be required 
to be word-searchable due to current technical hurdles to uniformly 
producing such elements in word-searchable form without incurring undue 
costs. Although the MSRB would strongly encourage submitters to 
immediately begin making submissions as word-searchable PDF files 
(preferably as native PDF or PDF normal files, which generally produce 
smaller and more easily downloadable files as compared to scanned PDF 
files), implementation of this requirement would be deferred as noted 
above to provide issuers, underwriters and other relevant market 
participants with sufficient time to adapt their processes and systems 
to provide for the routine creation or conversion of primary market 
disclosure documents as word-searchable PDF files.
    All submissions to the EMMA primary market disclosure service 
pursuant to this proposal would be made through password protected 
accounts on EMMA by: (i) Underwriters, which may submit any documents 
with respect to municipal securities which they have underwritten; and 
(ii) designated agents, which may be designated by underwriters to make 
submissions on their behalf. Underwriters would be permitted under the 
proposal to designate agents to submit documents and information on 
their behalf, and would be able to revoke the designation of any such 
agents, through the EMMA on-line account management utility. Such 
designated agents would be required to register to obtain password-
protected accounts on EMMA in order to make submissions on behalf of 
the designating underwriters.
    As proposed, electronic submissions of primary market disclosure 
documents through the EMMA primary market disclosure service would be 
made by underwriters and their agents, at no charge, through secured, 
password-protected interfaces. Submitters would have a choice of making 
submissions to the proposed EMMA primary market disclosure service 
either through a Web-based electronic submission interface or through 
electronic computer-to-computer data connections with EMMA designed to 
receive submissions on a bulk or continuous basis.
    All documents and information submitted through the EMMA primary 
market disclosure service pursuant to this proposal would be available 
to the public for free through the EMMA portal on the Internet, with 
documents made available for the life of the securities as

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PDF files for viewing, printing and downloading.\5\ As proposed, the 
EMMA portal would provide on-line search functions to enable users to 
readily identify and access documents that relate to specific municipal 
securities based on a broad range of search parameters. The EMMA portal 
also would permit users to request to receive alerts, at no charge, if 
a primary market disclosure document has become available on the EMMA 
portal or has been updated or amended \6\ and may also provide, at the 
election of the MSRB, summary data/statistical snapshots relating to 
documents and information submitted to the EMMA primary market 
disclosure service. In addition, the MSRB proposes that real-time data 
stream subscriptions to primary market disclosure documents submitted 
to EMMA would be made available for a fee as established under the 
primary market disclosure subscription proposal described below. The 
MSRB would not be responsible for the content of the information or 
documents submitted by submitters displayed on the EMMA portal or 
distributed to subscribers through the EMMA primary market disclosure 
subscription service.
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    \5\ The MSRB understands that software currently is generally 
available for free that permits users to save, view and print PDF 
files, as well as to conduct word searches in word-searchable PDF 
documents. The MSRB would provide links for downloading such 
software on the EMMA portal.
    \6\ The timing and reliability of users receiving alerts issued 
by EMMA is subject to limitations inherent in any e-mail-based 
system and users should not rely exclusively on such alerts.
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    The MSRB has designed EMMA, including the EMMA portal, as a 
scalable system with sufficient current capacity and the ability to add 
further capacity to meet foreseeable usage levels based on reasonable 
estimates of expected usage, and the MSRB would monitor usage levels in 
order to assure continued capacity in the future.
    The MSRB may restrict or terminate malicious, illegal or abusive 
usage for such periods as may be necessary and appropriate to ensure 
continuous and efficient access to the EMMA portal and to maintain the 
integrity of EMMA and its operational components. Such usage may 
include, without limitation, usage intended to cause the EMMA portal to 
become inaccessible by other users, to cause the EMMA database or 
operational components to become corrupted or otherwise unusable, to 
alter the appearance or functionality of the EMMA portal, or to 
hyperlink to or otherwise use the EMMA portal or the information 
provided through the EMMA portal in furtherance of fraudulent or other 
illegal activities (such as, for example, creating any inference of 
MSRB complicity with or approval of such fraudulent or illegal 
activities or creating a false impression that information used to 
further such fraudulent or illegal activities has been obtained from 
the MSRB or EMMA). Measures taken by the MSRB in response to such 
unacceptable usage shall be designed to minimize any potentially 
negative impact on the ability to access the EMMA portal.
Description of the EMMA Trade Price Transparency Proposal
    The EMMA trade price transparency proposal would establish, as a 
component of EMMA, the EMMA trade price transparency service to make 
available to the public historical and real-time transaction price 
information provided through the MSRB's Real-Time Transaction Reporting 
System (``RTRS''), together with related summary and statistical 
information. Free public access to the transaction price information 
would be provided through the EMMA trade price transparency service on 
the Internet through the EMMA portal.\7\ The transaction price 
information provided through the EMMA trade price transparency service 
would consist of all data available through RTRS for public 
dissemination since the inception of RTRS on January 31, 2005. This 
information could be expanded to include historical price data 
available through earlier MSRB transaction reporting systems.
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    \7\ In addition to being made available to the public for free 
through the EMMA portal on the Internet, transaction price 
information is made available through various subscription products 
offered by RTRS through existing RTRS mechanisms. See http://www.msrb.org/msrb1/TRSweb/rtrssubscription.asp. The EMMA trade price 
transparency service would be distinct from any such services or 
products provided directly by RTRS.
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    As proposed, the EMMA portal would provide on-line search functions 
to enable users to readily access transaction price information based 
on a broad range of search parameters. The MSRB may elect to expand its 
alert function on the EMMA portal to permit users to request to receive 
periodic alerts, at no charge, regarding whether trades have been 
reported in a specific security \8\ and to provide on the EMMA portal 
summary data/statistical snapshots of price data available through 
RTRS. The MSRB would not be responsible for the information reported by 
dealers to RTRS that is displayed on the EMMA portal.
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    \8\ For example, a user could receive an end-of-day e-mail alert 
on any day during which a particular security has been reported as 
having traded. Such alerts would not be available on a real-time 
basis and would not provide trade-by-trade alerts. The timing and 
reliability of users receiving alerts issued by EMMA is subject to 
limitations inherent in any e-mail-based system and users should not 
rely exclusively on such alerts.
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Description of the Primary Market Disclosure Subscription Proposal
    The real-time data stream subscription to the EMMA primary market 
disclosure service to be provided through a Web service would be made 
available for an annual fee of $20,000.\9\ The primary market 
disclosure subscription service would make available to subscribers all 
primary market disclosure documents and related information provided by 
submitters through the EMMA submission process that is posted on the 
EMMA portal. Such documents and information would be made available to 
subscribers simultaneously with the posting thereof on the EMMA portal.
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    \9\ The proposed subscription price would cover a portion of the 
administrative, technical and operating costs of the EMMA primary 
market disclosure subscription service but would not cover all costs 
of such subscription service or of the EMMA primary market 
disclosure service. The MSRB has proposed establishing the 
subscription price at a fair and reasonable level consistent with 
the MSRB's objective that subscriptions be made available on terms 
that promote the broad dissemination of documents and data 
throughout the marketplace.
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    Data with respect to the EMMA primary market disclosure service to 
be provided through the real-time data stream would consist of the 
following elements, among others and as applicable, as would be more 
specifically set forth in the EMMA Primary Market Subscriber Manual 
posted on the EMMA portal: (i) Submission data, including submission 
ID, submission type, submission status and submission transaction date/
time; (ii) offering data, including offering type, underwriting spread/
disclosure indicator, and official statement/preliminary official 
statement availability status; (iii) issue data, including issue type, 
security type, issuer name, issue description, state of issuer, six-
digit CUSIP (for commercial paper issues), expected closing date, dated 
date and original dated date (for certain remarketings); (iv) security 
data, including nine-digit CUSIP, security-specific dated date (for 
certain securities not having CUSIP numbers), principal amount at 
maturity, initial offering price or yield, maturity date, interest 
rate, partial underwriting data and refunded security CUSIP numbers; 
(v) document data, including document ID, document type, document 
description, document posting date, document status indicators

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and refunding and refunded issue identifiers (for advance refunding 
documents); (vi) file data, including file ID, file posting date and 
file status indicators; and (vii) limited offering contact data, 
including contact name, address and phone number (for obtaining 
official statements not available on EMMA for certain primary offerings 
not subject to Rule 15c2-12 by virtue of paragraph (d)(1)(i) thereof).
    The EMMA Primary Market Subscriber Manual would set forth a 
complete, up-to-date listing of all data elements made available 
through the primary market disclosure subscription service, including 
detailed definitions of each data element, specific data format 
information, and information about technical data elements to support 
transmission and data-integrity processes between EMMA and subscribers.
    Subscriptions would be provided through computer-to-computer data 
streams utilizing XML files for data and files in a designated 
electronic format (consisting of PDF files) for documents. Appropriate 
schemas and other technical specifications for accessing the Web 
services through which the real-time data stream are to be provided 
would be set forth in the EMMA Primary Market Subscriber Manual.
    The MSRB would make the primary market disclosure subscription 
service available on an equal and non-discriminatory basis. In 
addition, the MSRB would not impose any limitations on or additional 
charges for redistribution of such documents by subscribers to their 
customers, clients or other end-users. Subscribers would be subject to 
all of the terms of the subscription agreement to be entered into 
between the MSRB and each subscriber, including proprietary rights of 
third parties in information provided by such third parties that is 
made available through the subscription. The MSRB would not be 
responsible for the content of the information or documents submitted 
by submitters distributed to subscribers through the primary market 
disclosure subscription service.
Description of System Transition Proposal
    The system transition proposal would terminate the existing primary 
market pilot \10\ by deleting the pilot provisions from the MSIL 
facility and would suspend the MSIL system's functions of receiving 
submissions of official statements and advance refunding documents.
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    \10\ In establishing the primary market pilot, the MSRB had 
requested that the Commission approve the primary market pilot for a 
period of one year from the date it became operational, which was 
March 31, 2008. The MSRB has requested in a separate filing that the 
Commission approve the extension of the primary market pilot to the 
earlier of July 1, 2009 or the effective date of the permanent 
primary market disclosure service. See File No. SR-MSRB-2009-01.
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Description of the Rule Change Proposal
    The rule change proposal would effect extensive revisions to the 
official statement submission and dissemination requirements set forth 
in current MSRB rules in order to implement an ``access equals 
delivery'' model based on rules for final prospectus delivery for 
registered securities offerings adopted by the Commission in 2005.\11\ 
The rule change proposal would consolidate and amend existing 
provisions of current Rules G-32 and G-36 into revised Rule G-32, on 
disclosures in connection with primary offerings, and would make 
conforming changes to Rule G-8, on recordkeeping, and Rule G-9, on 
preservation of records. Rule G-36 would be rescinded by the proposal. 
In addition, the rule change proposal would establish a new electronic 
Form G-32 in connection with submissions made by underwriters to EMMA 
and would discontinue current Form G-36(OS) and Form G-36(ARD).
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    \11\ See Securities Act Release No. 8591 (July 19, 2005), 70 FR 
44722 (August 3, 2005). The rule change proposal would incorporate 
(with modifications adapted to the specific characteristics of the 
municipal securities market) many of the key ``access equals 
delivery'' provisions in Securities Act Rule 172, on delivery of 
prospectus, Rule 173, on notice of registration, and Rule 174, on 
delivery of prospectus by dealers and exemptions under Section 4(3) 
of the Securities Act of 1933, as amended.
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    Underwriters would be required under revised Rule G-32 to submit 
all primary market disclosure documents and related information to EMMA 
in electronic format, replacing the current submission process through 
the MSIL system pursuant to existing Rule G-36. Dealers selling most 
municipal securities in a primary offering to customers would be 
required under revised Rule G-32 to notify customers of the 
availability of official statements through EMMA (and, at the election 
of the dealer, any qualified portals) and to provide written copies of 
official statements to any customers requesting such copies. Except in 
the case of sales of municipal fund securities, dealers would no longer 
be required to provide printed copies of official statements to 
customers in primary offerings.
    Underwriters should be especially sensitive to the necessity of 
timely and accurate submissions to EMMA of official statements, 
preliminary official statements (when required), any amendments 
thereto, and all related information to be supplied through Form G-32. 
In particular, with the adoption of the ``access equals delivery'' 
standard, submissions to EMMA will become the lynchpin to the municipal 
securities primary market disclosure system that ensures that official 
statements are available to investors and the general public in a 
timely manner. Thus, any failure by the underwriter to make the 
required submission to EMMA within one business day after receipt from 
the issuer, but in no event later than the closing date,\12\ would have 
significant repercussions to the ability of investors to access the 
document. The MSRB expects that the timing requirements of revised Rule 
G-32 will be strictly adhered to and enforced to promote the purposes 
of the rule and the protection of investors.
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    \12\ The MSRB views it as critical that official statements be 
available to investors by no later than the new issue's closing date 
since such date represents the first time at which executed trades 
may be settled.
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    The MSRB's disclosure rules with respect to newly issued municipal 
securities are multifaceted and require diligence on the part of 
dealers to ensure that mandated disclosures are made at certain key 
points in the process of selling such securities to customers. Thus, 
dealers are reminded that, in addition to their obligations under Rule 
G-32, they are required under Rule G-17, on fair practice, to provide 
to the customer, at or prior to the time of trade, all material facts 
about the transaction known by the dealer as well as material facts 
about the security that are reasonably accessible to the market.\13\ 
The time of trade is generally the time at which an enforceable 
agreement is reached to execute a municipal securities transaction 
(sometimes referred to as trade execution). Disclosures made at or 
prior to the time of trade are intended to provide the customer with 
material information that he or she may use in making an investment 
decision.
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    \13\ See Rule G-17 Interpretation--Interpretive Notice Regarding 
Rule G-17, on Disclosure of Material Facts, March 20, 2002, 
reprinted in MSRB Rule Book.
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    The proposed rule change does not alter the time of trade 
disclosure obligation under Rule G-17. Disclosures made after the time 
of trade, such as by delivery of the official statement or by customer 
access to the official statement on EMMA at or near trade settlement, 
do not substitute for the required material disclosures that must be 
made at or prior to the time of trade pursuant to Rule G-17. In the new 
issue market,

[[Page 15194]]

the preliminary official statement, when available, often is used by 
dealers marketing new issues to customers and can serve as a primary 
vehicle for providing the required time-of-trade disclosures under Rule 
G-17, depending upon the accuracy and completeness of the preliminary 
official statement as of the time of trade. Dealers should note that 
additional or revised material information provided to the customer 
subsequent to the time of trade (such as in a revised preliminary 
official statement, the final official statement or through any other 
means) cannot cure a failure to provide the required material 
information at or prior to the time of trade.\14\ However, a revised 
preliminary official statement or other supplemental information 
provided to customers after delivery of the original preliminary 
official statement, but at or prior to the time of trade, can be used 
to comply with the time-of-trade disclosure obligation under Rule G-17. 
The MSRB has previously emphasized the importance of making material 
disclosures available to customers in sufficient time to make use of 
the information in coming to an investment decision, such as through 
earlier delivery of the preliminary official statement.\15\ The MSRB 
urges dealers to make preliminary official statements available to 
their potential customers in a timeframe that provides an adequate 
opportunity to make the appropriate assessments in coming to an 
investment decision.
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    \14\ See Securities Act Rule 159(b) adopted under Section 
17(a)(2) of the Securities Act of 1933. Rule 159(b) provides that, 
for purposes of determining whether a statement includes or 
represents any untrue statement of a material fact or any omission 
to state a material fact necessary in order to make the statements 
made, in light of the circumstances under which they were made, not 
misleading at the time of sale (including, without limitation, a 
contract of sale), any information conveyed to the purchaser only 
after such time of sale (including such contract of sale) will not 
be taken into account.
    \15\ See, e.g., MSRB Notice 2006-07 (March 31, 2006); MSRB 
Discussion Paper on Disclosure in the Municipal Securities Market 
(December 21, 2000), published in MSRB Reports, Vol. 21, No. 1 (May 
2001); and Official Statement Deliveries Under Rules G-32 and G-36 
and Exchange Act Rule 15c2-12 (July 15, 1999), published in MSRB 
Reports, Vol. 19, No. 3 (Sept. 1999).
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    The rule change proposal is described in more detail below.
Submissions to EMMA
    Official Statement and Form G-32 Submission Requirement. Under 
revised Rule G-32(b)(i)(A), underwriters would be required to submit 
information through the electronic Form G-32 for all primary offerings 
of municipal securities, regardless of whether an official statement is 
produced for such offering.\16\ The specific items of information to be 
submitted through Form G-32, and the manner and timing of such 
submission, are described below.
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    \16\ In contrast, submissions are required under current Rule G-
36 only for primary offerings for which an official statement is 
produced.
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    Under revised Rule G-32(b)(i)(B), except as described below, all 
submissions by underwriters of official statements would be required to 
be made within one business day after receipt from the issuer but by no 
later than the closing date \17\ for the offering. Rule G-36 currently 
has separate submission timing for official statements based on whether 
the primary offering is subject to or exempt from Exchange Act Rule 
15c2-12. For issues subject to such rule, current Rule G-36 establishes 
a final deadline of ten business days after the issuer agrees to sell 
the offering to the underwriter. This current timeframe does not ensure 
that official statements are always available by the closing date, 
particularly in those cases where an offering may be closed fewer than 
ten business days after the offering is sold. For issues exempt from 
Exchange Act Rule 15c2-12, current Rule G-36 requires submission of the 
official statement to the MSRB by the later of one business day after 
receipt from the issuer or one business day after the closing date. The 
revised provision is designed to ensure that the official statement is 
always available by the closing date, regardless of the type of 
offering.
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    \17\ ``Closing date'' would be defined in revised Rule G-
32(d)(ix) as the date of first delivery of the securities to the 
underwriter. For bond or note offerings, this would generally 
correspond to the traditional concept of the bond closing date. In 
the case of continuous offerings, such as for municipal fund 
securities, the closing date would be considered to occur when the 
first securities are delivered.
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    If an official statement is being prepared for a primary offering 
but it is not submitted to EMMA by the closing date, the underwriter 
would be required under revised Rule G-32(b)(i)(B)(2) to provide notice 
of such failure to file and to submit the preliminary official 
statement, if any, by the closing date, along with notice that the 
official statement will be submitted to EMMA when it becomes 
available.\18\ Once an official statement becomes available, the 
underwriter would be required to submit the official statement within 
one business day after receipt from the issuer. The submission of the 
preliminary official statement would not be a cure for a failure to 
submit the official statement in a timely manner but instead would be 
an additional obligation of the underwriter incurred upon failing to 
make timely submission of the official statement.
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    \18\ Current Rule G-36 does not require submission of the 
preliminary official statement. If no preliminary official statement 
exists, the underwriter would be required to provide notice of that 
fact to EMMA under revised Rule G-32(b)(i)(D).
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    Exceptions from Official Statement Submission Requirement. If no 
official statement is prepared for an offering exempt from Exchange Act 
Rule 15c2-12, revised Rule G-32(b)(i)(C) would require the underwriter 
to provide notice of that fact to EMMA, together with the preliminary 
official statement, if any, by the closing date.\19\ In the case of 
certain limited offerings,\20\ revised Rule G-32(b)(i)(E) would permit 
the underwriter to elect not to submit the official statement to EMMA 
if it instead submits to EMMA, by no later than closing: (i) Notice 
that the offering is not subject to Exchange Act Rule 15c2-12 by virtue 
of paragraph (d)(1)(i) and that an official statement has been prepared 
but is not being submitted to EMMA, and (ii) specific contact 
information for underwriter personnel to whom requests for copies of 
the official statement should be made.\21\ An underwriter withholding 
the official statement for a limited offering would be required to 
deliver the official statement to each customer purchasing the offered 
securities from the underwriter or from any other dealer, upon request, 
by the later of one business day after request or the settlement of the 
customer's transaction. In addition, submissions to EMMA in connection 
with roll-overs of commercial paper or remarketings of outstanding 
issues exempt from Rule 15c2-12 would not be required under revised 
Rule G-32(b)(i)(F) if no new official statement is prepared for the 
roll-over or remarketing or if an official statement has previously 
been submitted to EMMA in connection with such securities and no 
amendments or supplements to the official statement

[[Page 15195]]

have been made since such submission.\22\
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    \19\ Neither such notice nor the preliminary official statement 
is required to be submitted under current Rule G-36. If no 
preliminary official statement exists, the underwriter would be 
required to provide notice of that fact to EMMA under revised Rule 
G-32(b)(i)(D).
    \20\ Limited offerings consist of primary offerings under 
Exchange Act Rule 15c2-12(d)(1)(i) in which the securities have 
authorized denominations of $100,000 or more and are sold to no more 
than 35 persons who the underwriter reasonably believes: (a) have 
such knowledge and experience in financial and business matters that 
they are capable of evaluating the merits and risks of the 
prospective investment, and (b) are not purchasing for more than one 
account or with a view to distributing the securities.
    \21\ Under current Rule G-36, underwriters may withhold 
submission to the MSRB of the official statement for a limited 
offering without precondition.
    \22\ Revised Rule G-32 provides for the same treatment of 
commercial paper official statements as under current Rule G-36 but 
extends that treatment to remarketings exempt from Exchange Act Rule 
15c2-12, to the extent that no new official statement is produced in 
connection with such remarketing.
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    Advance Refunding Submissions Requirement. As under current Rule G-
36, revised Rule G-32(b)(ii) would require that underwriters submit 
advance refunding documents by no later than five business days after 
the closing date for primary offerings that advance refund an 
outstanding issue and for which an advance refunding document has been 
prepared. This proposed requirement would apply whenever an advance 
refunding document has been prepared in connection with a primary 
offering, not just for those offerings in which an official statement 
also has been prepared as under current Rule G-36.
    Amendments and Cancellations. Underwriters would be required by 
revised Rule G-32(b)(iii) to submit amendments to official statements 
and advance refunding documents during the primary offering disclosure 
period \23\ within one business day of receipt. In addition, 
underwriters would be required under revised Rule G-32(b)(iv) to submit 
prompt notice of any cancellation of an offering for which a submission 
of a document or information relating to the offering has previously 
been made to EMMA. If only a portion of an offering is cancelled, the 
underwriter's submission in connection with the remaining portion of 
the offering would be required to be corrected by no later than the 
closing date to reflect the partial cancellation of the offering. If 
the entire offering is cancelled, notice of such cancellation would be 
deemed under paragraph (vi)(C) of Rule G-32 to have been submitted to 
EMMA promptly under paragraph (vi)(C) of Rule G-32 if submitted by no 
later than five business days after the underwriter cancels its trades 
with customers and other dealers.\24\
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    \23\ The term ``new issue disclosure period'' under current Rule 
G-32 is renamed as ``primary offering disclosure period'' under 
revised Rule G-32(d)(ix) to emphasize that the rule applies to 
municipal securities remarketed in a primary offering, not just to 
new issues of municipal securities.
    \24\ See revised Rule G-32(b)(vi)(C).
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    Transitional Submissions. Revised Rule G-32(e) establishes 
transitional provisions for submitting official statements during the 
five business days preceding the effective date of revised Rule G-32 
and the primary market disclosure service. In general, any submission 
to the MSRB of an official statement, advance refunding document or 
amendment thereto under current Rule G-36 becoming due during the five 
business days prior to the effective date may be held by the 
underwriter for submission to EMMA on the first two business days on 
which the primary market disclosure service is effective. The MSRB 
would reserve the right to require an underwriter that has sent a 
document in paper form to the MSRB during the five business days prior 
to the effective date that is received by the MSRB after the effective 
date to resubmit such document in a designated electronic format 
through EMMA and the MSRB would require such resubmission through EMMA 
for any documents sent in paper form to the MSRB on or after the 
effective date.
Designated Electronic Format of Submitted Documents
    Revised Rule G-32(b)(vi)(A) would prescribe the format in which 
documents would be required to be submitted to EMMA as a designated 
electronic format. Revised Rule G-32(d)(iii) would establish PDF files 
as the initial sole designated electronic format, with files configured 
to permit documents to be saved, viewed, printed and retransmitted by 
electronic means. If the submitted file is a reproduction of the 
original document, the submitted file must maintain the graphical and 
textual integrity of the original document. In addition, starting on 
January 1, 2010, such PDF files must be word-searchable (that is, 
allowing the user to search for specific terms used within the document 
through a search or find function available in most standard software 
packages), provided that diagrams, images and other non-textual 
elements would not be required to be word-searchable due to current 
technical hurdles to uniformly producing such elements in word-
searchable form without incurring undue costs. Although, the MSRB would 
strongly encourage submitters to immediately begin making submissions 
as word-searchable PDF files (preferably as native PDF or PDF normal 
files, which generally produce smaller and more easily downloadable 
files as compared to scanned PDF files), implementation of this 
requirement would be deferred as noted above to provide issuers, 
obligated persons and their agents with sufficient time to adapt their 
processes and systems to provide for the routine creation or conversion 
of continuing disclosure documents as word-searchable PDF files.
    The MSRB may in the future designate additional computerized 
formats as acceptable electronic formats for submission or preparation 
of documents under Revised Rule G-32 by means of a filing with the 
Commission. As noted in the discussion below of comments received in 
connection with this proposal, the MSRB supports the Commission's 
Interactive Data and XBRL Initiatives for registered offerings and 
would consider designating XBRL as a designated electronic format for 
purposes of submissions to the EMMA primary market disclosure service 
at such time in the future as appropriate taxonomies for the municipal 
marketplace have been developed and as issuers begin the process of 
producing primary market disclosure documents using XBRL.
Submission of Documents as Multiple Files
    Underwriters would be permitted to submit official statements and 
other required documents in the form of one or more electronic files. 
EMMA permits such submissions as multiple files as an accommodation for 
those situations where technical or other difficulties preclude or 
substantially impair the production and submission of the official 
statement or other document as a single electronic file. Barring such 
circumstances, underwriters, issuers and investors would be best served 
if all submissions of documents are made as a single electronic file 
rather than multiple files. In particular, underwriters should consider 
the risk of potentially disseminating to the public incomplete 
disclosure should they, inadvertently or otherwise, fail to submit on a 
simultaneous or immediately sequential basis all of the required files 
of a multi-file official statement submission.\25\
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    \25\ Underwriters should note that they are required to submit 
to EMMA, along with a document, the date such document is received 
from the issuer. In the case of the official statement, the MSRB 
would not consider the underwriter to have received the official 
statement until it has received the complete document. Thus, if the 
issuer were to provide the official statement to the underwriter in 
the form of multiple files, the underwriter should not consider the 
official statement to have been received from the issuer until the 
final file of such document necessary to complete the official 
statement has been received. In that case, the underwriter would 
report the date on which such final file was received as the date on 
which the official statement (including each file thereof, 
regardless of any earlier receipt of some such files) was received 
for purposes of the required information submission.
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Form G-32
    General. New Form G-32, which would replace current Form G-36(OS) 
and Form G-36(ARD), would include all information required to be 
submitted by underwriters under revised Rule G-

[[Page 15196]]

32(b)(i)(A) and (b)(vi).\26\ Form G-32 would consist of a collection of 
data elements provided to EMMA in connection with a primary offering of 
municipal securities. When making primary market submissions using the 
Web-based interface, related indexing information would be entered into 
an on-line form or uploaded through an extensible markup language (XML) 
file, and documents would be uploaded in a designated electronic 
format. Computer-to-computer submissions would utilize XML files for 
data and PDF files for documents. The proposal would permit Form G-32 
to be completed in a single session or in multiple sessions, with the 
initiation of the Form G-32 submission process generally occurring 
earlier than the current Form G-36 submission process.\27\ Appropriate 
procedures and schemas for on-line and computer-to-computer submissions 
would be published on the EMMA portal and MSRB Web site and would be 
described in detail in the EMMA Dataport Manual.
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    \26\ New Form G-32 is included in Exhibit 3 to the proposed rule 
change.
    \27\ Under current Rule G-36, Form G-36 is submitted 
simultaneously with the official statement. The rule change proposal 
would no longer require that the submission of information and the 
dissemination of such information on EMMA be delayed until the 
related official statement has become available.
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    As proposed, underwriters would be required to make a submission 
through Form G-32 in connection with each official statement (or 
preliminary official statement, where no official statement exists), as 
well as in connection with each offering for which no official 
statement or preliminary official statement is to be made available 
through EMMA.\28\ Information relating to advance refunding documents 
executed in connection with a primary offering also would be submitted 
under the proposal through the Form G-32 submission process. 
Submissions during the primary offering disclosure period of amendments 
to previously submitted documents would be made through the same Form 
G-32 submission initiated in connection with the original documents.
---------------------------------------------------------------------------

    \28\ Where no official statement or preliminary official 
statement is being submitted to EMMA, the underwriter would be 
required to provide notice thereof to EMMA. Such information would 
be designed in part to provide through the EMMA portal notice to 
customers and others that no official statement or preliminary 
official statement will be available. The proposal would provide for 
limited exceptions for commercial paper roll-overs and remarketings 
exempt from Rule 15c2-12 where no new disclosure document is 
prepared.
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    Designated Agents. Underwriters would be permitted under revised 
Rule G-32(b)(vi)(C) to designate agents to make submissions on their 
behalf through the MSRB's user account management and authentication 
system known as MSRB Gateway.\29\ All submissions made on behalf of an 
underwriter by a designated agent would be the responsibility of the 
designating underwriter, and any failure by the designated agent to 
provide documents or information in a complete, timely and conforming 
manner would be deemed to be a failure by the designating underwriter.
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    \29\ Current Rule G-36 does not permit submissions to the MSRB 
by agents on behalf of underwriters.
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    The MSRB notes that Rule G-34(a)(ii)(C)(1) requires underwriters 
for most new issues of municipal securities to provide certain 
information regarding the new issue to an automated electronic new 
issue information dissemination system (``NIIDS'') within two hours of 
the time of formal award of the issue. The MSRB may consider in the 
future permitting an underwriter to designate to the MSRB that 
information it has submitted to NIIDS under revised Rule G-34 should 
also be used for purposes of completing new Form G-32, although it 
would not be anticipated that NIIDS would provide documents to EMMA and 
such submissions would be the responsibility of the underwriter or 
another designated agent. The MSRB would publish a notice advising if 
such functionality becomes available.
    Standard of Care With Respect to Information Submitted by 
Underwriters. Much of the information to be provided by underwriters 
and their agents on new Form G-32 normally would be made available to 
the public through the EMMA portal on a real-time basis under the rule 
change proposal. The underwriter must exercise due care with respect to 
the accuracy of the items of information provided on Form G-32, 
although it is understood that much of this information would be 
subject to change until an issue has reached closing. Until closing, 
the underwriter would be expected to update promptly any information 
previously provided by it on Form G-32 which may have changed or to 
correct promptly any inaccuracies in such information, and would be 
responsible for ensuring that such information provided by it is 
accurate as of the closing date. Except with regard to the submission 
of advance refunding documents or amendments to the official statement 
as described below, the underwriter would not be obligated to update 
information provided by it on Form G-32 due to changes in such 
information occurring after the closing date, although the underwriter 
would remain responsible for correcting any information it provided 
that was erroneous as of the later of the time the information was 
submitted or the closing date. Information would be deemed to be 
provided by the underwriter if it has been supplied by the underwriter 
or a designated agent of the underwriter directly to EMMA or it has 
been pre-populated by the EMMA Web-based interface to the extent that 
such information is editable on the EMMA Web-based interface by the 
underwriter or its designated agent.\30\
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    \30\ The underwriter would be obligated to review and make any 
necessary corrections to such editable data. The underwriter would 
not be responsible for any items of information pre-populated by 
EMMA which are not editable by the underwriter or its designated 
agent. With respect to the CUSIP numbers assigned by the CUSIP 
Service Bureau and other information that is presented during the 
submission process on EMMA as non-editable information, the 
underwriter would not be obligated to make corrections to such 
information. However, the underwriter would be obligated to ensure 
that each security in a primary offering is correctly associated 
with the submission the underwriter is making. Thus, pursuant to 
instructions to be included in the EMMA Dataport Manual, the 
underwriter would be required to review the collection of security-
specific information pre-populated by EMMA during the submission 
process to ensure that all such securities have properly been 
associated with the submission, and the underwriter would be 
obligated to add additional information (including but not limited 
to any relevant CUSIP numbers) not pre-populated by EMMA to the 
extent necessary to fully associate all applicable securities with 
the submission and to indicate that information for a security that 
has been pre-populated by EMMA should be removed because such 
security is not in fact associated with the submission.
---------------------------------------------------------------------------

    As noted above, the MSRB expects that the requirement that all 
information to be supplied through Form G-32 be accurately and 
completely submitted by the applicable deadlines, and particularly by 
the closing date, will be strictly enforced to promote the purposes of 
the revised Rule G-32 and the protection of investors.
    Use of Form G-32 in Connection With Offerings and Issues. For 
purposes of submitting Form G-32 under the proposal, an offering would 
consist of all securities described in the official statement, and the 
offering could consist of one or more issues.\31\ An issue

[[Page 15197]]

generally would consist of all securities in an offering having the 
same issuer, the same issue description (including same series 
designation or named obligor, if applicable) and the same dated date. 
In cases where no official statement is produced, each issue not 
described in an official statement would be considered a separate 
offering for purposes of Form G-32.
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    \31\ As used in this context, an offering generally would 
correspond to the definition of a primary offering under revised 
Rule G-32 and Exchange Act Rule 15c2-12. Multiple issues (including 
but not limited to separately designated series of an offering) on a 
single official statement would be treated as part of the same 
offering for purposes of Form G-32 submissions even if issued by 
different issuers and/or underwritten by different underwriters. 
However, to the extent that a primary offering is offered through 
more than one official statement (e.g., separate official statements 
for separate issues within a single primary offering), offering-
level information to be provided through a Form G-32 submission 
would relate solely to the portion of the primary offering described 
in the official statement that is the subject of the specific 
submission, and the remainder of the information related to such 
primary offering would be provided through a separate Form G-32 
submission for the other official statement.
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    Basic Submission Process for Form G-32. The basic information to be 
provided through Form G-32 and the timing of the submission of such 
information for a typical submission to EMMA under revised Rule G-32 
would be as set forth below. An underwriter would be responsible for 
providing all information described below to the extent so required for 
all maturities of any issue underwritten in whole or in part by such 
underwriter.\32\ In the case in which an underwriter does not 
underwrite any portion of one or more issues in an offering, the 
underwriter would be responsible for providing only the nine-digit 
CUSIP number for the latest maturity of any such non-underwritten 
issue.\33\
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    \32\ For example, if an underwriter only underwrites two 
maturities of an issue consisting of ten maturities, the underwriter 
would be responsible for reporting information regarding all ten 
maturities in the issue. See also footnote 31 supra.
    \33\ For example, if an offering consists of three issues, only 
two of which were underwritten in any part by a particular 
underwriter, such underwriter would be responsible for providing the 
full information required under Form G-32 for the two issues it 
underwrites but would only be responsible for providing the nine-
digit CUSIP number for the latest maturity of the issue it does not 
underwrite. See also footnotes 31 and 32 supra.
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    Information on date of first execution of transaction. The 
underwriter would be required under revised Rule G-32(b)(i)(A) and 
(b)(vi)(C)(1)(a) to initiate the Form G-32 submission process by no 
later than the date of first execution of transactions in securities 
sold in the offering, at which time the underwriter would provide the 
following items of information with respect to each issue it 
underwrites:
    <bullet> Issue-specific information consisting of the full issuer 
name and issue description, as such items are expected to appear in the 
official statement,\34\ and the expected closing date of the issue; 
\35\ and
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    \34\ For an issue that is ineligible for CUSIP number 
assignment, the state of the issuer and dated date also would be 
provided. For an issue of municipal fund securities, the state of 
the issuer also would be provided. For an issue of commercial paper, 
the six-digit CUSIP number assigned to the issue also would be 
provided in connection with the initiation of the commercial paper 
program (but not in connection with subsequent roll-overs, unless 
such information has changed). For a remarketed issue, the original 
dated date of the issue when originally issued also would be 
provided if a new dated date has been assigned to the remarketed 
issue.
    \35\ If the closing date has not yet been firmly established on 
the date of first execution, the underwriter would provide a 
reasonable estimate of such closing date at that time and would be 
obligated to update such estimated closing date when such date is 
determined. Thus, if the actual closing date differs from the 
expected closing date supplied on the date of first execution, the 
underwriter would be responsible to provide the correct closing date 
by no later than the actual closing date. For an issue of municipal 
fund securities, the expected closing date would be the date on 
which the first deliveries of securities in the issue are expected 
to be made.
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    <bullet> Security-specific information consisting of the nine-digit 
CUSIP number, the principal amount at maturity of each security, and 
the initial offering price or yield for each security in the issue 
(including initial offering price or yield of any securities otherwise 
considered not-reoffered).\36\
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    \36\ The initial offering price could be expressed either in 
terms of dollar price or yield. For an issue that is ineligible for 
CUSIP number assignment, the nine-digit CUSIP number would be 
omitted but the maturity date and interest rate would be provided. 
For issues of municipal fund securities and commercial paper, no 
security-specific information would be required. If the underwriter 
did not underwrite any portion of an issue in the offering, the 
underwriter would only be required to provide the nine-digit CUSIP 
number for the latest maturity of such non-underwritten issue.
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    Document and information at time of submission of official 
statement. The official statement would be required under revised Rule 
G-32(b)(i)(B)(1) to be submitted to EMMA, along with related Form G-32 
information, within one business day after receipt from the issuer or 
its designated agent, but by no later than the closing date. The 
underwriter would be required to submit, along with or prior to the 
submission of the official statement, the following items with respect 
to each issue:
    <bullet> Official statement document as a PDF file, as well as 
information on the date the official statement was received from the 
issuer and confirmation of the full issuer name and issue description, 
as such items actually appear in the official statement; \37\ and
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    \37\ For an issue of commercial paper, the official statement 
would be submitted in connection with the initiation of the 
commercial paper program but, pursuant to revised Rule G-
32(b)(i)(F), would not be required in connection with subsequent 
roll-overs, unless the official statement has been modified. For a 
remarketed issue, the underwriter/remarketing agent would be 
required to indicate whether the submitted document is the complete 
disclosure document or supplements the original official statement 
produced in connection with the initial offering of the remarketed 
issue. Pursuant to revised Rule G-32(b)(i)(F), no official statement 
is required in connection with a remarketing if no such document or 
supplement was created. The underwriter would also be required to 
make any corrections to the full issuer name and issue description 
provided at the time of first execution to the extent necessary to 
reflect the information as it actually appears on the official 
statement.
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    <bullet> Underwriting spread or agency fee paid by the issuer to 
the underwriter for a negotiated offering, if not disclosed within the 
official statement.\38\
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    \38\ Thus, if such information is provided in the official 
statement as is currently the custom, the underwriter would not be 
required to enter it into Form G-32.
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    In the typical offering, the submission of the document to EMMA 
within one business day of receipt from the issuer would be preceded by 
the required initial submission of information on or prior to the date 
of first execution of a transaction in the securities. However, in 
those cases where the official statement submission deadline precedes 
the date of first execution (for example, if the underwriter has 
received the official statement in advance of the date of first 
execution), the underwriter would be required to submit, along with or 
prior to the submission of the official statement and the items of 
information identified above, the following additional items with 
respect to each issue (which otherwise would be required to be 
submitted by no later than the date of first execution): \39\
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    \39\ Other items normally required to be submitted by no later 
than the time of first execution would continue to be required by 
such deadline.
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    <bullet> Issue-specific information consisting of the full issuer 
name and issue description, as such items appear in the official 
statement, and the expected closing date of the issue; \40\ and
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    \40\ For an issue of commercial paper, the six-digit CUSIP 
number assigned to the issue also would be provided unless such 
CUSIP number has not yet been assigned, in which case such number 
would be required to be submitted promptly after assignment but by 
no later than the time of first execution.
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    <bullet> Security-specific information consisting of the nine-digit 
CUSIP number for each security in the issue, if then available.\41\
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    \41\ If CUSIP numbers have not yet been assigned, then such 
numbers would be required to be submitted promptly after assignment 
but by no later than the date of first execution, unless the issue 
is ineligible for CUSIP number assignment or the issue consists of 
municipal fund securities or commercial paper.
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    Summary of Basic Information Requirements. The items of information 
to be submitted and the timing of such submissions through Form G-32 
under revised Rule G-32 for submissions not

[[Page 15198]]

requiring additional information (as described below) is summarized in 
the following table:

----------------------------------------------------------------------------------------------------------------
                 Item                                                    Timing
----------------------------------------------------------------------------------------------------------------
Full issuer name/issue description....  Earlier of (i) date of first execution and (ii) date of official
                                         statement submission.
9-digit CUSIP number..................  Earlier of (i) date of first execution and (ii) later of (a) official
                                         statement submission or (b) assignment of CUSIP number.
Principal amount......................  Date of first execution.
Initial offering price/yield..........  Date of first execution.
Expected closing date.................  Date of first execution.
Official statement document...........  Date of official statement submission.
Date official statement received......  Date of official statement submission.
Underwriting spread/agency fee........  Date of official statement submission.
----------------------------------------------------------------------------------------------------------------

    Additional Items in Connection With Special Cases. No additional 
information would be required beyond the information described above 
unless (i) the official statement is not available for submission by 
closing, (ii) the offering consists solely of one or more limited 
offerings for which the official statement will not be made available 
by the underwriter through EMMA, (iii) any issue in the offering 
advance refunds outstanding securities, (iv) the underwriter underwrote 
only a portion of an issue, (v) the offering qualifies for an exemption 
from the MSRB's underwriting assessment under Rule A-13(a) or a reduced 
underwriting assessment rate under Rule A-13(b), (vi) the official 
statement is amended, or (vii) corrections are necessary to information 
previously provided. Additional information that the underwriter would 
be required to submit through Form G-32 and the timing of the 
submission of such information for these special cases are as set forth 
below:
    Information and/or document by closing for special cases. 
Additional information, as applicable, would be required to be 
submitted by no later than closing as follows:
    <bullet> If an official statement will be produced but is not yet 
available, the preliminary official statement document as a PDF file, 
if available, or a notice that no preliminary official statement has 
been prepared, as required under revised Rule G-32(b)(i)(B)(2)(c) and 
(b)(i)(D)(1), and notice that the official statement document will be 
submitted when it becomes available, as required under revised Rule G-
32(b)(i)(B)(2)(a);
    <bullet> If an official statement will not be produced, the 
preliminary official statement document as a PDF file, if available, or 
a notice that no preliminary official statement has been prepared, as 
required under revised Rule G-32(b)(i)(C)(2) and (b)(i)(D)(1), notice 
that no official statement has been prepared, as required under revised 
Rule G-32(b)(i)(C)(1), and an indication of which exception under Rule 
15c2-12 applies with regard to the official statement;
    <bullet> If an underwriter elects to withhold an official statement 
from EMMA for a limited offering under Exchange Act Rule 15c2-
12(d)(1)(i), notice that the offering is a limited offering and that 
the official statement will not be made available through EMMA, as 
required under revised Rule G-32(b)(i)(E)(2)(a), and contact 
information for requests for copies of the official statement, as 
required under revised Rule G-32(b)(i)(E)(2)(b);
    <bullet> If an issue advance refunds outstanding securities, notice 
to that effect; or
    <bullet> If an underwriter believes that it is entitled to an 
exemption from the underwriting assessment or a reduced assessment 
rate, information as to the basis for such modified assessment.\42\
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    \42\ Such information would include an indication (i) that the 
underwriter underwrote less than the full principal amount of an 
issue and the amount underwritten by the underwriter, (ii) as to 
which category of underwriting assessment exemption under Rule A-
13(a) would apply to the entire offering, or (iii) as to which 
category of reduced underwriting assessment under Rule A-13(b) would 
apply to the entire offering.
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    Document and information at time of submission of advance refunding 
document. If an issue advance refunds outstanding securities, the 
advance refunding document would be required under revised Rule G-
32(b)(ii) to be submitted to EMMA, along with related Form G-32 
information, by no later than five business days after the closing on 
the refunding issue. The underwriter would be required to submit, along 
with or prior to the submission of the advance refunding document, the 
following items:
    <bullet> Advance refunding document as a PDF file, as well as 
information on the date the advance refunding document was received 
from the issuer;
    <bullet> Information identifying the refunding issues relating to 
the advance refunding document; and
    <bullet> Security-specific information for the refunded securities, 
consisting of the original nine-digit CUSIP number for each security 
refunded and, if any new CUSIP numbers are assigned in connection with 
any refunded or unrefunded portions of the security, the maturity date 
of such security and any such newly issued CUSIP numbers.\43\
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    \43\ New CUSIP numbers are required to be obtained with respect 
to securities advance refunded in part pursuant to Rule G-
34(a)(i)(D). For a refunded security that does not have a nine-digit 
CUSIP number, the issuer name, state of issuer, issue description 
and maturity date would be required to be provided.
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    Document and information at time of submission of amendment to 
official statement or preliminary official statement. Amendments to the 
official statement or preliminary official statement occurring during 
the primary offering disclosure period would be required under revised 
Rule G-32(b)(iii) to be submitted by the underwriter to EMMA within one 
business day of receipt from the issuer.\44\ The underwriter would be 
required to submit, along with or prior to the submission of the 
amendment to the official statement, the following items:
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    \44\ Revisions made to the preliminary official statement in 
order to convert such document into the final official statement 
would not be considered an amendment to the preliminary official 
statement requiring submission to EMMA. Instead, the underwriter 
would submit the final official statement itself as required under 
Rule G-32.
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    <bullet> The amendment document as a PDF file, as well as 
information on the date the amendment was received from the issuer; 
\45\ and
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    \45\ A single submission of the PDF file of the amendment would 
meet the document submission requirement with respect to the 
original official statement.
---------------------------------------------------------------------------

    <bullet> Information on whether the submitted document supplements 
the original official statement or preliminary official statement and 
should be displayed by EMMA along

[[Page 15199]]

with the original, or the submitted document is the complete disclosure 
document and should replace the original official statement or 
preliminary official statement as the document to be displayed by 
EMMA.\46\
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    \46\ In general, an official statement submitted for an issue in 
which a preliminary official statement was previously submitted to 
EMMA would replace the preliminary official statement as the 
``active'' disclosure document on EMMA, although the preliminary 
official statement would continue to be accessible through the 
archive for the particular issue. Issues of municipal fund 
securities remain continuously in the primary offering disclosure 
period for so long as securities continue to be sold in connection 
with such issue and therefore numerous amendments may occur over the 
course of many years. Such amendments may initially supplement the 
original official statement until such time as the issuer produces 
an entirely new official statement, which new official statement 
would be treated as an amendment that replaces the original document 
and all preceding supplements. Thereafter, this new official 
statement may itself be supplemented by one or more amendments and, 
after a period of time, the new official statement and supplements 
may again be replaced by a new official statement. This sequence 
generally would continue for so long as the issuer continues selling 
securities in such issue.
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Disclosures to Customers
    Subsection (a)(i) of revised Rule G-32 would retain the basic 
official statement dissemination requirements for dealers selling 
offered municipal securities \47\ to customers as set forth in current 
Rule G-32. However, under subsection (a)(ii), dealers selling offered 
municipal securities, other than municipal fund securities, would be 
deemed to have satisfied this basic requirement for delivering official 
statements to customers by trade settlement since such official 
statements would be publicly available for free through the EMMA 
portal. In the case of a dealer that is the underwriter for the primary 
offering, such satisfaction would be conditioned on the underwriter 
having submitted the official statement to EMMA. Dealers selling 
municipal fund securities would remain subject to the existing official 
statement delivery requirement.
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    \47\ The term ``new issue municipal securities'' under current 
Rule G-32 is renamed as ``offered municipal securities'' under 
revised Rule G-32(d)(vi) to emphasize that the rule applies to 
municipal securities remarketed in a primary offering, not just to 
new issues of municipal securities.
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    Under subsection (a)(iii) of revised Rule G-32, a dealer selling 
offered municipal securities with respect to which the official 
statement delivery obligation is deemed satisfied as described above 
would be required to provide or send to the customer, by no later than 
trade settlement, either a copy of the official statement or a written 
notice \48\ advising how to obtain the official statement from the EMMA 
portal and that a copy of the official statement would be provided upon 
request.\49\ Dealers may include in such notice additional information 
about obtaining the official statement from a qualified portal.\50\ 
Dealers may, but are not required to, provide such notice on or with 
the trade confirmation. Under Rule G-15(a)(i), confirmations are 
required to be given or sent to customers at or prior to trade 
settlement. If the customer requests a copy of the official statement, 
the dealer would be required to send it within one business day of the 
request by first class mail or by such other equally prompt means. 
Dealers would be required to honor any customer's explicit standing 
request for copies of official statements for all of his or her 
transactions with the dealer.
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    \48\ Dealers wishing to provide such notice in electronic form 
should consider guidance previously published by the MSRB concerning 
the use of electronic communications where standards for notice, 
access and evidence to show delivery are met. See Rule G-32 
Interpretation--Notice Regarding Electronic Delivery and Receipt of 
Information by Brokers, Dealers and Municipal Securities Dealers, 
November 20, 1998, reprinted in MSRB Rule Book (the ``1998 
Electronic Delivery Notice'').
    \49\ Current Rule G-32 requires that the official statement be 
delivered to customers by settlement, whereas revised Rule G-32 
would require the official statement or notice of availability of 
the official statement to be provided or sent by settlement. The 
official statement itself would continue to be available by 
settlement through EMMA but the timing of the notice is designed to 
permit such information to be included on or with the transaction 
confirmation.
    \50\ Revised Rule G-32(d)(x) would define qualified portal to 
mean an Internet-based utility providing access by any purchaser or 
potential purchaser of offered municipal securities to the official 
statement for such offered municipal securities in a designated 
electronic format, and allowing such purchaser or potential 
purchaser to search for (using the nine-digit CUSIP number and other 
appropriate search parameters), view, print and save the official 
statement, at no charge, for a period beginning on the first 
business day after such official statement becomes available from 
EMMA and ending no earlier than 30 calendar days after the end of 
the primary offering disclosure period for such offered municipal 
securities; provided that any such utility shall not be a qualified 
portal unless notice to users that official statements are also 
available from EMMA is posted and a hyperlink to EMMA are posted on 
the page on which searches on such utility for official statements 
may be conducted.
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    The MSRB would view the obligation to provide the first portion of 
the customer notice regarding the availability of the official 
statement as having been presumptively fulfilled if the notice provides 
the uniform resource locator (URL) for the specific EMMA portal page 
from which the official statement may be viewed and downloaded \51\ or 
the 9-digit CUSIP number for the security and the URL for the EMMA 
portal search page through which a search based on such CUSIP number 
may be undertaken.
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    \51\ Currently, the page for such viewing and downloading on 
EMMA for a particular security to which a 9-digit CUSIP number has 
been assigned will have an URL of the format ``http://emma.msrb.org/SecurityView/SecurityDetails.aspx?cusip= [ENTER 9-DIGIT CUSIP 
NUMBER]''. The MSRB will provide advance notice if the format of 
such URL is changed in the future.
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    Revised Rule G-32(a)(iv) would not substantially change the 
delivery obligation with respect to sales of municipal fund securities 
from those that exist under current Rule G-32(a).\52\ The selling 
dealer would be required to deliver the official statement (e.g., 
program disclosure document, information statement, etc.) to the 
customer by trade settlement, provided that the dealer could satisfy 
this delivery obligation for its repeat customers (i.e., customers 
participating in periodic municipal fund security plans or non-periodic 
municipal fund security programs) by promptly sending any updated 
disclosure material to the customer as it becomes available, as set 
forth in paragraph (a)(iv)(A).\53\ In addition, the dealer would 
continue to be required under revised paragraph (a)(iv)(B) to disclose 
any distribution-related fee received as agent for the issuer.\54\
---------------------------------------------------------------------------

    \52\ Although the ``access equals delivery'' model would not be 
available for municipal fund securities, underwriters (i.e., primary 
distributors) of such securities would be required to submit the 
official statements to EMMA electronically. Dealers wishing to 
fulfill their official statement delivery requirements using 
electronic official statements should consider guidance previously 
published by the MSRB concerning the use of electronic 
communications where standards for notice, access and evidence to 
show delivery are met. See the 1998 Electronic Delivery Notice, 
supra footnote 48.
    \53\ This provision is substantially identical to the provisions 
of current Rule G-32(a)(i)(A).
    \54\ This is the same disclosure that currently is required in 
connection with sales of municipal fund securities under current 
Rule G-32(a)(ii)(B). With respect to municipal securities other than 
municipal fund securities sold on a negotiated basis, the 
underwriting spread, agency fee and initial offering prices required 
to be disclosed by dealers selling new issue municipal securities 
under current Rule G-32(a)(ii) would be disclosed on EMMA under 
revised Rule G-32 by means of the underwriter submitting such 
information through Form G-32.
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Recordkeeping
    Subsections (a)(xiii) and (a)(xv) of Rule G-8 currently require 
that records be maintained in connection with deliveries of official 
statements to customers and submissions of official statements, advance 
refunding documents and Forms G-36(OS) and (ARD) to the MSRB. The rule 
change proposal would modify certain of these requirements to reflect 
the changes to Rule G-32 and consolidate the requirements of revised 
Rule G-32 into subsection (a)(xiii). Subsection (b)(x) of

[[Page 15200]]

Rule G-9 relating to preservation of such records would also be 
modified to conform to the changes to Rule G-8. In general, 
underwriters would be required to retain electronic copies of documents 
and XML data files they submit to EMMA, and EMMA would provide 
underwriters with the ability to save for their records copies of data 
entered into EMMA's Web-based electronic submission interface.\55\
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    \55\ Underwriters would continue to maintain historical records 
under Rule G-36 pursuant to Rule G-8(a)(xv), as revised to reflect 
the rescission of Rule G-36, for so long as required under Rule G-
9(b)(xi).
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2. Statutory Basis
    The MSRB has adopted the proposed rule change pursuant to Section 
15B(b)(2)(C) of the Act,\56\ which provides that the MSRB's rules 
shall:
---------------------------------------------------------------------------

    \56\ 15 U.S.C. 78o-4(b)(2)(C).

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, to remove 
impediments to and perfect the mechanism of a free and open market 
in municipal securities, and, in general, to protect investors and 
---------------------------------------------------------------------------
the public interest.

    The MSRB believes that the proposed rule change is consistent with 
the Act. The EMMA primary market disclosure service and EMMA trade 
price transparency service would serve as additional mechanisms by 
which the MSRB works toward removing impediments to and helping to 
perfect the mechanisms of a free and open market in municipal 
securities. The services would help make information useful for making 
investment decisions more easily available to all participants in the 
municipal securities market on an equal basis throughout the life of 
the securities without charge through a centralized, searchable 
Internet-based repository, thereby removing potential barriers to 
obtaining such information. Broad access to primary market disclosure 
documents and price transparency information through the EMMA portal 
should assist in preventing fraudulent and manipulative acts and 
practices by improving the opportunity for public investors to access 
material information about issuers, their securities and the prices at 
which such securities trade.
    Furthermore, a single centralized and searchable venue for free 
public access to disclosure and transaction price information should 
promote a more fair and efficient municipal securities market in which 
transactions are effected on the basis of material information 
available to all parties to such transactions, which should allow for 
fairer pricing of transactions based on a more complete understanding 
of the terms of the securities, the potential investment risks, and 
trade pricing activity in the marketplace. The electronic dissemination 
of primary market disclosure documents should allow issuers to reduce 
their issuance costs by eliminating the need to print and to distribute 
in paper official statements in connection with their primary 
offerings, thereby resulting in lower costs to issuers and savings to 
their citizens. Lower printing and dissemination costs also may result 
in lower expenses for underwriters and potentially lower prices for 
investors. Free access to such documents--previously available in most 
cases only through paid subscription services or on a per-document fee 
basis--should reduce transaction costs for dealers and investors.
    All of these factors serve to promote the statutory mandate of the 
MSRB to protect investors and the public interest.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The MSRB does not believe that the proposed rule change would 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The proposed rule change would 
apply equally to all dealers selling offered municipal securities to 
customers, as well as to all underwriters underwriting primary 
offerings of municipal securities. Documents and information provided 
through the EMMA portal would be available to all persons 
simultaneously. In addition to making the documents and information 
available for free on the EMMA portal to all members of the public, the 
MSRB would make primary market disclosure documents and information 
available by subscription on an equal and non-discriminatory basis 
without imposing restrictions on subscribers from, or imposing 
additional charges on subscribers for, re-disseminating such documents 
or otherwise offering value-added services and products based on such 
documents on terms determined by each subscriber.
    The MSRB has considered carefully a commentator's concern regarding 
the MSRB's plans to develop EMMA,\57\ as well as expressions of 
interest from private enterprises in entering this market.\58\ One 
commentator on the Pilot Filing \59\ stated that the MSRB's intention 
to combine primary market and other disclosures with trade price data 
``breaks new ground among regulatory bodies in terms of value-added 
content available to the public at no charge,'' arguing that the MSRB 
would ``effectively take over the business of providing value-added 
content.'' \60\ This commentator had previously stated that providing 
official statements for free to the public would impose a cost to the 
dealer community to subsidize the system's development and operation, 
which it argued would ``appear[] to be more biased and unfair than 
recovering the costs from the users of the system based on usage,'' and 
noted that providing official statements for free through public access 
portals would ``impair the economic interests of information vendors 
that currently make OSs available on a commercial basis.'' \61\
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    \57\ See comments from Peter J. Schmitt, CEO, DPC DATA Inc. 
(``DPC''), dated January 23, 2008. DPC's comments are discussed in 
greater detail in section 5 of this filing under the heading 
``Discussion of Comments--Structure of the Centralized Electronic 
System.''
    \58\ See letter from Philip C. Moyer, CEO, EDGAR Online, Inc. 
(``EDGAR Online''), to Ernesto A. Lanza, Senior Associate General 
Counsel, MSRB, dated December 17, 2007. EDGAR Online's comments are 
discussed in greater detail in section 5 of this filing under the 
heading ``Discussion of Comments--Structure of the Centralized 
Electronic System.'' In addition, the MSRB has received several 
inquiries through the pilot EMMA portal's feedback (http://www.emma.msrb.org/AboutEMMA/Feedback.aspx) and contact (http://www.emma.msrb.org/AboutEMMA/ContactUs.aspx) Web forms from members 
of the public seeking information on using EMMA documents and data, 
through the EMMA portal or subscription services, for the purposes 
of redissemination to their customers.
    \59\ See footnote 2 supra.
    \60\ See comments of DPC on the Pilot Filing. DPC further 
stated, ``There is precedent of other Self-Regulatory Organizations 
(SROs) offering such sophisticated value-added information to the 
market, but only on a fee basis.'' DPC also stated that ``the MSRB's 
sample pilot portal at http://www.msrb.org/msrb1/accessportal/SampleComprehensiveDisclosureDisplay.htm provides a glimpse of 
specific value-added features the MSRB intends to offer the public 
free of charge. Among these are nine-digit CUSIP searches, 
hyperlinks to bond issuers Web sites, an `alerts' service to users 
of the portal, sophisticated document viewing options, links to 
other related documents in the portals disclosure archive, and 
subsequent event notifications that equate to custom research. These 
features and capabilities are well in excess of the system that the 
MSRB has pointed to as its model, the SEC's own EDGAR.''
    \61\ See comments of DPC on MSRB Notice 2007-5 (January 25, 
2007). DPC further stated that the MSRB's proposal to require 
dealers to provide notices to customers with a URL at a public 
access portal where the official statement could be obtained would 
be ``prejudicial to the economic interests of existing vendors whose 
delivery services required that the definitive PDF file be archived 
on their Web sites for public access.''
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    Another commentator on the Pilot Filing argued in favor of the 
creation of a ``publicly accessible storage and dissemination system'' 
for all filings in

[[Page 15201]]

the municipal securities market, stating that the current municipal 
securities disclosure model ``severely limits innovation and access'' 
to disclosures and ``locks up public documents in private hands while 
the proposed portal run by a public entity will encourage transparency 
in the municipal securities market and create a healthy ecosystem of 
information that will ultimately benefit both the investment community 
and the municipalities that seek access to public markets.'' \62\
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    \62\ See letter from EDGAR Online. EDGAR Online further stated, 
``In spite of a great deal of work by the Municipal Issuers on their 
disclosures--a small group of companies control access for the 
entire market to the documents that are supposed to be public.* * * 
The rigid control of public information dissuades other information 
providers from trying to enter or innovate for this market. This 
means that there are few people working on improving ease of use, 
depth of analysis, thoroughness of information or more effective 
means of delivery.* * * The process of managing these documents 
consumes most of the resources of these few information providers 
and the time of investors. As a result, the information contained in 
these documents--risks and opportunities--are usually lost because 
there are few sources of good comparability and data.''
---------------------------------------------------------------------------

    The MSRB observes that free access to official statements by the 
public through the EMMA portal and other qualified portals is a 
fundamental characteristic necessary for establishment of an ``access 
equals delivery'' standard for official statement dissemination to 
customers purchasing offered municipal securities, as proposed under 
the rule change proposal, and would be similar in many respects to the 
free access to prospectuses provided through the Commission's 
Electronic Data Gathering, Analysis, and Retrieval system (EDGAR). 
Access through EDGAR serves as an important element in the treatment of 
final prospectus delivery for registered offerings under Commission 
rules adopted in 2005.\63\ The costs of development and operation would 
be paid from MSRB revenues which are derived from assessments on 
dealers that are imposed under MSRB Rules A-12 (initial fee), A-13 
(underwriting and transaction assessments) and A-14 (annual fee), as 
well as from subscription fees to be charged for the real-time 
subscriptions. The fees charged under MSRB rules are fairly apportioned 
and apply equally to all equally-situated dealers and therefore would 
have no impact on competition among dealers active in the municipal 
securities market. The MSRB does not believe that investors in 
municipal securities should be charged for disclosure information 
produced by issuers with the intention that it be used for making 
informed investment decisions and for understanding the terms of the 
securities they own, although the MSRB acknowledges that direct or 
indirect costs of providing disclosure may impact on the fees paid by 
investors in effecting transactions. However, the MSRB believes that 
potential savings on transaction costs due to reduced costs of printing 
and distributing paper official statements under the ``access equals 
delivery'' model, as described in section 3(b) of this filing, together 
with the other benefits provided by the EMMA primary market disclosure 
service and EMMA trade price transparency service identified herein, 
would justify the costs of development and operation of the EMMA 
primary market disclosure service.
---------------------------------------------------------------------------

    \63\ See Securities Act Release No. 8591 (July 19, 2005), 70 FR 
44722 (August 3, 2005).
---------------------------------------------------------------------------

    The MSRB believes that the availability of primary market 
disclosure documents through the EMMA portal and the primary market 
subscription service, without the imposition of limitations on or 
additional charges for redistribution of such documents to customers, 
clients or other end-users of the subscriber,\64\ as well as the 
availability of price transparency information through the EMMA 
portal,\65\ would promote, rather than hinder, further competition, 
growth and innovation in this area. The MSRB further believes that the 
operation by the MSRB of the EMMA primary market disclosure service and 
the EMMA trade price transparency service would not result in the MSRB 
taking over the business of providing value-added content but instead 
serve as a basis on which private enterprises could themselves 
concentrate more of their resources on developing and marketing value-
added services. The MSRB believes that much of the impact of the 
proposed rule change on commercial enterprises would result from the 
increased competition in the marketplace resulting from the entry of 
additional commercial enterprises in competition with such existing 
market participants with respect to value-added services, rather than 
from the operation of the EMMA primary market disclosure service and 
EMMA trade price transparency service as sources of raw documents and 
information to the public. The MSRB believes that the benefits realized 
by the investing public from the broader and easier availability of 
disclosure and price transparency information in connection with 
municipal securities that would be provided through the EMMA primary 
market disclosure service and EMMA trade price transparency service 
would justify any potentially negative impact on existing enterprises 
from the operation of EMMA.
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    \64\ The MSRB notes that subscribers may be subject to 
proprietary rights of third parties in information provided by such 
third parties that is made available through the subscription.
    \65\ Price transparency information is already available by 
subscription through existing RTRS products.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The MSRB has published a series of notices seeking comment on the 
establishment of an ``access equals delivery'' standard for official 
statement dissemination. These notices, the comments received, and the 
MSRB's responses are discussed below.
Concept Release
    In a concept release published on July 27, 2006, the MSRB sought 
comment on whether the establishment of an ``access equals delivery'' 
model in the municipal securities market would be appropriate and on 
the general parameters relating to such a model (the ``Concept 
Release'').\66\ With regard to public access to official statements 
under an ``access equals delivery'' standard for municipal securities, 
the Concept Release stated that electronic official statements would 
need to be made readily available to the investing public, at no cost, 
throughout the new issue disclosure period, at a minimum. The MSRB 
expressed the belief that investors would be best served if such 
official statements were made available at a centralized Internet Web 
site but sought comment on a possible alternative using a central 
directory of official statements with hosting of electronic official 
statements undertaken by issuers, financial advisors, underwriters, 
information vendors, printers and others maintaining free ready access 
to such documents. The MSRB also sought comment on whether it should 
undertake the central access function, or whether other market 
participants or vendors could undertake such function subject to 
appropriate supervision.
---------------------------------------------------------------------------

    \66\ MSRB Notice 2006-19 (July 27, 2006).
---------------------------------------------------------------------------

    The Concept Release had originally proposed that Rule G-32 be 
revised to permit a dealer selling new issue municipal securities to a 
customer to provide notice to the customer that the official statement 
is available electronically as an alternative to physical delivery of 
the official statement to the customer. The selling dealer would be 
required to provide a

[[Page 15202]]

printed version of the official statement upon request. The 
requirements in current Rule G-32 with respect to inter-dealer 
distribution of official statements would be deleted as the official 
statements would be readily available electronically. Finally, dealer 
financial advisors that prepare official statements on behalf of 
issuers would be required to provide electronic versions to the 
underwriters.
    The Concept Release also proposed that Rule G-36 be revised to 
require underwriters of all primary offerings of municipal securities 
for which official statements are prepared to submit the official 
statements to the MSRB solely in electronic form. The timeframe for 
submission of official statements could be simplified to require the 
underwriter to submit the official statement for any offering 
(regardless of its status under Exchange Act Rule 15c2-12) by no later 
than the business day following receipt from the issuer, but in no 
event later than the bond closing date.
    Rule G-36 would continue to require underwriters to submit much of 
the information currently included on Form G-36(OS) but would no longer 
require that such information be provided simultaneously with the 
official statement or in a single submission. Such information 
submission would be accepted solely in electronic form, either through 
a Web-based interface or by upload or data stream using XML or other 
appropriate format. In addition, underwriters would be permitted to 
designate submission agents for the official statement and required 
information submissions, although the underwriters would remain 
responsible for accurate and timely submissions. The underwriter would 
be required to make an initial submission of information, consisting of 
CUSIP numbers and list offering prices of all maturities in the issue, 
on or prior to the first execution of a transaction in such issue.\67\ 
The underwriter would thereafter submit further required information 
and the electronic official statement as they become available. 
Information submissions under Rule G-36 would be required for all new 
issues, even if no official statement is being produced. If an official 
statement is not being produced, the underwriter would be required to 
report that fact.
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    \67\ The Concept Release noted that underwriters are already 
required to disseminate CUSIP information within this same timeframe 
under current Rule G-34 for virtually all new issues. The list 
offering price information disclosure under revised Rule G-36 would 
take the place of such disclosure to customers under current Rule G-
32.
---------------------------------------------------------------------------

    The Concept Release sought comment on whether the ``access equals 
delivery'' model should be available on all new issues or whether 
certain classes of new issues should continue to be subject to a 
physical delivery requirement, such as issues of municipal fund 
securities or issues exempt from Exchange Act Rule 15c2-12. The Concept 
Release also asked whether notice to the customer should be provided by 
trade settlement, matching the current timing of official statement 
delivery under Rule G-32, or two business days after trade settlement, 
as is required under Securities Act Rule 173 with respect to registered 
offerings.
January 2007 Notice
    In a subsequent notice published on January 25, 2007, the MSRB 
sought comment on draft amendments to Rules G-32 and G-36 to implement 
the ``access equals delivery'' standard (the ``January 2007 
Notice'').\68\ The January 2007 Notice sought comment on extensive 
proposed revisions to the official statement submission and 
dissemination requirements under MSRB rules. Current Rules G-32 and G-
36 would be consolidated into a single substantially revised Rule G-32 
and Rule G-36 would be rescinded.
---------------------------------------------------------------------------

    \68\ MSRB Notice 2007-5 (January 25, 2007).
---------------------------------------------------------------------------

    Revised Rule G-32 would retain the official statement dissemination 
requirements for dealers selling new issue municipal securities to 
customers but dealers selling new issue municipal securities would be 
deemed to have satisfied this requirement.\69\ A dealer selling new 
issue municipal securities would be required to provide to the 
customer, within two business days following trade settlement, either a 
copy of the official statement or a written notice stating that the 
official statement is available from the centralized electronic system, 
providing a Web address where such official statement may be obtained, 
and stating that a copy of the official statement would be provided 
upon request. In addition, if the customer requests a copy of the 
official statement, the dealer would be required to send it promptly 
and to honor any customer's explicit standing request for copies of 
official statements for all of his or her transactions with the dealer. 
The January 2007 Notice noted that the notice to customers must include 
the URL assigned to the specific official statement referred to in the 
notice and sought comment on whether the notice to customers must refer 
specifically to the centralized electronic system or may identify a 
different source.
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    \69\ Dealers selling municipal fund securities would remain 
subject to the existing physical delivery requirements. In the case 
of a dealer that is the underwriter for the new issue, such 
satisfaction would be conditioned on the underwriter having 
submitted the official statement to the centralized electronic 
system.
---------------------------------------------------------------------------

    The January 2007 Notice sought comment on whether offerings 
described under Exchange Act Rule 15c2-12(d)(1)(i) (``limited 
offerings'') should be excluded from the ``access equals delivery'' 
model or, in the alternative, whether an exclusion should be provided 
at the election of the underwriter with a required information 
submission to the centralized electronic system to provide public 
notice of such election.
    All submissions by underwriters of official statements to the 
centralized electronic system would be required to be made within one 
business day after receipt from the issuer but by no later than the 
closing date.\70\ If no official statement is prepared or if an 
official statement is being prepared but is not yet available from the 
issuer by the closing date, the underwriter would be required to submit 
the preliminary official statement, if any, to the centralized 
electronic system by the closing date. Once an official statement 
becomes available, the underwriter would be required to submit the 
official statement within one business day after receipt from the 
issuer. If no official statement is prepared for an offering, the 
underwriter also would be required to provide notice of that fact.
---------------------------------------------------------------------------

    \70\ The revised rule would not provide an exception from the 
electronic submission requirement for official statements relating 
to municipal fund securities.
---------------------------------------------------------------------------

    Underwriters would continue to be required to submit advance 
refunding documents by no later than five business days after the 
closing date. The requirement would apply whenever an advance refunding 
document has been prepared in connection with a primary offering, not 
just for those offerings in which an official statement also has been 
prepared as under current Rule G-36. Amendments to official statements 
and advance refunding documents would be required to be submitted 
within one business day of receipt throughout the new issue disclosure 
period. In addition, underwriters would be required to provide notice 
of any cancellation of an issue for which a submission has previously 
been made.
    Under revised Rule G-32, all official statements, preliminary 
official statements and advance refunding documents, as well as any 
amendments thereto, would be submitted to the centralized electronic 
system by electronic means in a designated electronic format. Paper 
submissions would no longer be accepted, with all

[[Page 15203]]

submissions limited at the outset to PDF files. The centralized 
electronic system would be designed to accept such electronic 
submissions either through an upgraded version of the existing MSIL 
Web-based interface known as the e-OS system or by upload or data 
stream initially using XML.
    Current Form G-36(OS) and Form G-36(ARD), which can be completed 
either on paper or electronically, would be replaced by a single Form 
G-32 that would be completed electronically. Underwriters would be 
required to submit a Form G-32 in connection with each official 
statement (or preliminary official statement, where no official 
statement exists), as well as in connection with each offering for 
which no official statement or preliminary official statement is 
available. The January 2007 Notice anticipated that the Form G-32 
submission process would be initiated by the submission of the CUSIP 
number information and initial offering prices for each maturity 
shortly after the bond sale (e.g., by the time of the first execution 
of a transaction within the meaning of Rule G-34). Other items of 
information to be submitted through the Form G-32 submission process, 
including the underwriting spread, if any, and the amount of any fee 
received by the underwriter as agent for the issuer in the distribution 
of the securities (to the extent such information is not included in 
the official statement), as well as many of the items currently 
required on Form G-36(OS) in connection with the MSRB's underwriting 
assessment under Rule A-13, would be provided by the underwriter as 
they become available. Form G-32 would be completed by the closing 
date, although for certain items that may not become available until 
after the closing date (e.g., advance refunding documents, amendments 
to official statements, etc.), submissions could continue to be made as 
necessary up to the end of the new issue disclosure period. All 
submissions of advance refunding documents, amendments and notices of 
issue cancellation would be made by means of a Form G-32 previously 
initiated in connection with the related official statement or 
offering.
    Underwriters would be permitted to designate one or more submission 
agents to submit documents and information required under the rule. The 
rule would not limit who may act as such submission agent on behalf of 
the underwriter but, as an agent, the underwriter would be bound by the 
actions of such agent.
    Revised Rule G-32 would require any dealer acting as financial 
advisor that prepares the official statement for the issuer in any 
offering of municipal securities to make the official statement 
available to the managing or sole underwriter in a designated 
electronic format promptly after it has been approved by the issuer for 
distribution.
    Existing definitions in Rules G-32 and G-36 would be consolidated 
into revised Rule G-32, with the definition of ``new issue municipal 
securities'' no longer excluding commercial paper and the definition of 
``new issue disclosure period'' modified to emphasize that the period 
ends 25 days after the final delivery by the issuer of any securities 
of the issue. New definitions for ``designated electronic format'' and 
``closing date'' would be added.
    Rules G-8 and G-9 also would be modified to reflect recordkeeping 
changes as they relate to revised Rule G-32.
    The January 2007 Notice also described certain basic features of 
the planned centralized electronic system, noting that, in addition to 
the public access portal that the MSRB anticipated operating, other 
portals using the document collection from the MSRB obtained through 
real-time subscriptions could be established by other entities as 
parallel sources for official statements and other documents and 
information. These separate portals could provide these services on 
such commercial terms as they deem appropriate. The January 2007 Notice 
stated that the MSRB's goal in promoting the establishment of parallel 
public access portals would be to provide all market participants with 
a realistic opportunity to access official statements and other 
documents and information throughout the life of the securities in a 
non-cost prohibitive manner while encouraging market-based approaches 
to meeting the needs of investors and other market participants.
November 2007 Notice
    On November 15, 2007, the MSRB sought comment on certain revisions 
to the draft amendments to Rules G-32 and G-36 (the ``November 2007 
Notice'').\71\ In particular, the MSRB sought further comment on the 
nature of the notice to be provided to customers regarding the 
availability of electronic official statements, underwriter submission 
requirements to EMMA for limited offerings, and the timing of 
initiation of the submission process to EMMA.
---------------------------------------------------------------------------

    \71\ MSRB Notice 2007-33 (November 15, 2007). The November 2007 
Notice also announced the filing with the Commission of a proposed 
rule change to establish the pilot EMMA portal, which became 
operational on March 31, 2008 after Commission approval. See Pilot 
Filing at footnote 2 supra.
---------------------------------------------------------------------------

    The November 2007 Notice sought comment on a revised provision to 
Rule G-32 that would require a dealer selling a new issue security to 
advise the customer as to how to obtain the official statement from the 
centralized electronic system. The November 2007 Notice stated that the 
MSRB would view this obligation as having been presumptively fulfilled 
if the notice provides the URL for the specific official statement or 
for the search page of an access portal at which the official statement 
may be found pursuant to a search.
    The November 2007 Notice sought comment on a provision that would 
make submission of official statements for limited offerings optional. 
For those limited offerings in which the underwriter submits the 
official statement to the centralized electronic system, the ``access 
equals delivery'' standard would apply and the official statement would 
be available through the public access portal. However, the underwriter 
could elect to withhold submission of the official statement for a 
limited offering if it provides the following items to the 
dissemination system for posting on the public access portals: (i) A 
certification affirming that the issue meets all of the requirements of 
Exchange Act Rule 15c2-12(d)(1)(i) as a limited offering; (ii) notice 
that the official statement is not available on-line but that the 
underwriter would provide a copy to any customer purchasing such 
limited offering; and (iii) specific contact information for 
underwriter personnel to whom requests for copies of the official 
statement should be made.
    The November 2007 Notice also sought comment on a revised 
definition of designated electronic format, which was modified to 
consist of an electronic format acceptable to the MSRB that is word-
searchable and must permit the document to be saved, viewed, printed 
and retransmitted by electronic means using software generally 
available for free or on a commercial basis to non-business computer 
users. Documents in portable document format that are word-searchable 
and may be saved, viewed, printed and retransmitted by electronic means 
would be deemed to be in a designated electronic format.
    Finally, the November 2007 Notice sought comment on a revised 
provision that would explicitly require underwriters to initiate the 
submission process by no later than the Time of First Execution, as 
defined in proposed amendments to Rule G-34 then pending.

[[Page 15204]]

September 2008 Notice
    On September 24, 2008, the MSRB sought comment on preliminary 
specifications for computer-to-computer processes for submissions to 
the EMMA primary market disclosure service and subscriptions under the 
EMMA primary market disclosure subscription service (the ``September 
2008 Notice'').\72\ The September 2008 Notice set forth the expected 
processes, data elements and file formats for computer-to-computer 
submissions and subscriptions.
---------------------------------------------------------------------------

    \72\ MSRB Notice 2008-40 (September 24, 2008).
---------------------------------------------------------------------------

Discussion of Comments
    The MSRB received comments on the Concept Release from 29 
commentators,\73\ on the January 2007 Notice from 12 commentators,\74\ 
and on the November 2007 Notice from four commentators.\75\ The MSRB 
received no comments on the September 2008 Notice. In addition, two 
commentators submitted comment letters on the MSRB's Pilot Filing with 
the Commission.\76\ After reviewing these comments, the MSRB approved 
the proposed rule change for filing with the Commission. The principal 
comments are discussed below.
---------------------------------------------------------------------------

    \73\ See letters from Edward J. Sullivan, Chair, American Bar 
Association, Section of State and Local Government, to Mr. Lanza, 
dated October 9, 2006; Robert W. Doty, President, American 
Government Financial Services Company (``AGFS''), to Mr. Lanza, 
dated September 15, 2006; Gerard F. Scavelli, Senior Vice President 
and General Manager, Automated Data Process, Inc., to Mr. Lanza, 
dated September 15, 2006; Eric Bederman, Chief Compliance Officer, 
Bernardi Securities, Inc. (``Bernardi''), to Mr. Lanza, dated August 
7, 2006; Leslie M. Norwood, Vice President and Assistant General 
Counsel, Bond Market Association (``BMA''), to Mr. Lanza, dated 
September 15, 2006; Blaine Schwartz, President and COO, 
brokersXpress, LLC (``brokersXpress''), to Mr. Lanza, dated 
September 15, 2006; Jackie T. Williams, Chair, College Savings Plans 
Network (``CSPN''), to Mr. Lanza, dated September 22, 2006; Michael 
A. Dardis, Manager of Trust and Investment Products Compliance, 
Commerce Bancshares, Inc. (``Commerce''), to Mr. Lanza, dated 
September 13, 2006; Paula Stuart, Chief Executive Officer, Digital 
Assurance Certification LLC, to Mr. Lanza, dated September 29, 2006; 
Mr. Schmitt, DPC, to Mr. Lanza, dated September 13, 2006; Robert 
Beck, Prinicipal, Municipal Bonds, Edward D. Jones & Co., LP 
(``Edward Jones''), to Mr. Lanza, dated September 13, 2006; Richard 
A. DeLong, Senior Vice President, Municipal Trading and 
Underwriting, First Southwest Company (``First Southwest''), to Mr. 
Lanza, dated September 15, 2006; Robert J. Stracks, Counsel, 
Griffin, Kubik, Stephens & Thompson, Inc. (``Griffin Kubik''), to 
Mr. Lanza, dated September 14, 2006; Elizabeth R. Krentzman, General 
Counsel, Investment Company Institute (``ICI''), to Mr. Lanza, dated 
September 14, 2006; Ronald J. Dieckman, Senior Vice President, 
Director of Public Finance/Municipals, J.J.B. Hilliard, W.L. Lyons, 
Inc. (``Hilliard Lyons''), to Mr. Lanza, dated August 4, 2006; Jerry 
L. Chapman, Managing Director, Municipal Product Manager, Morgan 
Keegan & Company, Inc. (``Morgan Keegan''), to Mr. Lanza, dated 
August 31, 2006; Gary P. Machak, Chairman, Municipal Advisory 
Council of Texas (``Texas MAC''), to Mr. Lanza, dated September 14, 
2006; Walter J. St. Onge III, President, National Association of 
Bond Lawyers (``NABL''), to Mr. Lanza, dated September 14, 2006; 
Eric Friedland, Chairman, National Federation of Municipal Analysts 
(``NFMA''), to Mr. Lanza, dated September 15, 2006; Thomas Sargant, 
President, Regional Municipal Operations Association (``RMOA''), to 
Mr. Lanza, dated September 27, 2006; Elizabeth Varley, Vice-
President and Director of Retirement Policy, and Michael D. Udoff, 
Vice-President, Associate General Counsel and Secretary, Securities 
Industry Association (``SIA''), to Mr. Lanza, dated September 20, 
2006; Gerard Faulkner, Director--CUSIP Operations, Standard & Poor's 
CUSIP Service Bureau (``S&P CUSIP''), to Mr. Lanza, dated September 
15, 2006; Daniel E. Stone to Mr. Lanza, dated September 2, 2006; 
Ruth D. Brod, Consultant, TRB Associates, to Mr. Lanza, dated 
September 14, 2006; Terry L. Atkinson, Managing Director, UBS 
Securities LLC (``UBS''), to Mr. Lanza, dated September 15, 2006; 
James C. Thompson, Divisional Executive Vice President, UMB Bank, 
N.A. (``UMB''), to Mr. Lanza, dated September 14, 2006; Eileen M. 
Smiley, Vice President and Assistant Secretary, USAA Investment 
Management Company (``USAA''), to Mr. Lanza, dated September 15, 
2006; John McCune, President, Wells Fargo Institutional Brokerage & 
Sales (``Wells Fargo''), to Mr. Lanza, September 14, 2006; and Eric 
Pehrson, Vice President, Zions Bank Public Finance (``Zions''), to 
Mr. Lanza, dated September 8, 2006.
    \74\ See letters from J. Cooper Petagna, Jr., President, 
American Municipal Securities, Inc. (``AMS''), to Mr. Lanza, dated 
March 12, 2007; Vincent A. Mazzaro, Senior Managing Director and 
Controller of Municipals, Bear, Stearns & Co., Inc. (``Bear 
Stearns''), to Mr. Lanza, dated March 19, 2007; Mr. Bederman, 
Bernardi, to Mr. Lanza, dated March 5, 2007; Ms. Williams, CSPN, to 
Mr. Lanza, dated September 20, 2007; Mr. Schmitt, DPC, to Mr. Lanza, 
dated March 9, 2007; Mr. Stracks, Griffin Kubik, to Mr. Lanza, dated 
March 14, 2007; Kevin Colleran, Vice President, Ipreo Holdings LLC 
(``Ipreo''), to Mr. Lanza, dated March 9, 2007; Carol L. Lew, 
President, NABL, to Mr. Lanza, dated March 12, 2007; Ms. Norwood, 
Securities Industry and Financial Markets Association (``SIFMA''), 
to Mr. Lanza, dated March 16, 2007; Merry Jane Tissier to Mr. Lanza, 
dated March 8, 2007; Mr. Thompson, UMB, to Mr. Lanza, dated February 
25, 2007; and Chris Charles, President, Wulff, Hansen & Co. 
(``Wulff''), to Mr. Lanza, dated March 7, 2007.
    \75\ See letters from Frank R. Hoadley, Chairman, Governmental 
Debt Committee, Government Finance Officers Association (``GFOA''), 
to Mr. Lanza, dated December 20, 2007; J. Foster Clark, President, 
NABL, to Mr. Lanza, dated December 17, 2007; S. Lauren Heyne, Chief 
Compliance Officer, R.W. Smith & Associates, Inc. (``RW Smith''), to 
Mr. Lanza, dated December 17, 2007; and Ms. Norwood, Managing 
Director and Associate General Counsel, SIFMA, to Mr. Lanza, dated 
December 14, 2007.
    \76\ See Pilot Filing at footnote 2 supra. The MSRB received a 
comment letter from EDGAR Online, see footnote 57 supra, and the 
Commission received a comment letter from DPC, see footnote 56 
supra.
---------------------------------------------------------------------------

    Support for ``Access Equals Delivery'' and Centralized Internet 
Access to Official Statements. Commentators were nearly unanimous in 
their support of adoption of an ``access equals delivery'' standard and 
the establishment of a centralized Internet-based system for 
dissemination of municipal securities disclosure.\77\ Many commentators 
state that official statements are increasingly available in electronic 
form and that the potential burden on dealers of having to produce an 
electronic version from a paper official statement supplied by an 
issuer from time to time is out-weighed by the benefits.\78\ 
Commentators generally agreed that an ``access equals delivery'' would 
decrease overall costs \79\ and should make disclosure information 
available more quickly and more broadly.\80\ GFOA ``compliment[ed] the 
MSRB on its work to date on this project and support[ed] its efforts to 
create a system that works well for all participants in the 
marketplace.'' NABL ``strongly supports the concept of `access equals 
delivery' that is embodied in the proposed draft amendments.'' SIFMA 
observed that:
---------------------------------------------------------------------------

    \77\ AGFS, AMS, Bear Stearns, Bernardi, BMA, brokersXpress, 
CSPN, Commerce, DPC, EDGAR Online, Edward Jones, First Southwest, 
GFOA, Griffin Kubik, Hilliard Lyons, ICI, Ipreo, Morgan Keegan, 
Texas MAC, NABL, NFMA, RMOA, RW Smith, SIA, SIFMA, S&P CUSIP, UBS, 
UMB, USAA, Wells Fargo, Wulff, Zions. Although DPC supported the 
concept of electronic access to official statements, it expressed 
concerns regarding several basic concepts, as discussed below. While 
supporting a central dissemination system for official statements, 
TRB stated that it was unclear whether the proposal would make any 
improvement on what it viewed as most important--the availability of 
current information on all municipal bonds on an ongoing basis.
    \78\ BMA, Commerce, DPC, ICI, NABL, Wells Fargo. Griffin Kubik 
and SIA stated that they agreed with the positions set forth in 
BMA's comment letter. UBS withheld judgment pending more details on 
implementation. RMOA and S&P CUSIP note that the Depository Trust 
and Clearing Corporation charges a ``disincentive fee'' for 
underwriter submissions of paper official statements.
    \79\ AGFS, Bernardi, Hilliard Lyons, Morgan Keegan, UBS, UMB, 
USAA, Zions. However, ADP argued that this standard would shift 
printing costs to investors. Hilliard Lyons stated that, although 
issuer costs may be reduced in negotiated offerings, it is typical 
that the underwriter incurs the printing and shipping costs for 
official statements in competitive offerings.
    \80\ AGFS, ADP, Bernardi, DPC, Morgan Keegan, NFMA, TRB, UBS, 
USAA.

the key to success for implementation of a comparable system (to the 
SEC's [access equals delivery] system) for MSRB rules is that the 
proposal must meet the readily available, free of charge standard, 
that it promotes efficiency in the market and that it meets criteria 
for ``flow through'' processing of information. The Association 
believes the Notice promotes these objectives and that the MSRB 
---------------------------------------------------------------------------
should continue the process of eventually achieving these goals.

    The MSRB believes that there is widespread support throughout the 
municipal securities industry for the MSRB's plan to implement an 
``access equals delivery'' standard for official statement 
dissemination.
    Physical Delivery. AGFS and ADP noted that there are more elderly 
individual investors who may be less technologically savvy in the 
municipal securities market than in other markets. Mr. Stone expressed 
a desire not to be required to request delivery of a printed

[[Page 15205]]

official statement every time he makes a purchase. Ms. Tissier stated 
that the burden should not be on investors to request a paper copy and 
expressed concern regarding spam and fraudulent materials on the 
computer and the need for a paper trail for recordkeeping purposes. 
RMOA also noted that certain segments of the municipal securities 
investment community may not have at-home access to the Internet and 
expected that dealers would honor requests for physical deliveries, 
although it believed that regulations requiring this would be 
excessive. Hilliard Lyons believed that there should be a requirement 
to provide a physical copy if requested.
    The MSRB has proposed in revised Rule G-32 that physical delivery 
of the official statement would be required for any customer requesting 
a copy of the official statement. Thus, if the customer requests a copy 
of the official statement, the dealer would be required to send it 
within one business day of request by first class mail or other equally 
prompt means. Dealers would be required to honor standing requests for 
paper official statements from customers--thus, customers would not be 
required to request physical delivery each time they purchase offered 
municipal securities if they have informed their dealer of a desire to 
always receive physical delivery.
    ADP believed that electronic delivery of official statements would 
offer an opportunity for enhancing information access in municipal 
securities offerings.\81\ However, ADP opposed shifting the disclosure 
dissemination system to an ``access equals delivery'' model and instead 
advocated a system of ``dual distribution'' in which customers would 
receive delivery of official statements in both printed and electronic 
(via e-mail) forms. ADP argued that a significant proportion of 
investors still do not have ready access to electronic information, 
that many investors are unwilling to access their investment 
information on-line, that investors are more likely to view electronic 
information if it is pushed to them rather than requiring that they 
actively seek it out, and that electronic delivery would shift printing 
costs to investors.
---------------------------------------------------------------------------

    \81\ ADP stated that the nature of the information flowing to 
investors throughout the offering process is more significant in 
registered offerings as compared to municipal securities offerings 
and noted potential areas in which the disclosure information 
currently produced by municipal issuers could be qualitatively 
improved. ADP did not suggest that such differences precluded the 
adoption of an ``access equals delivery'' standard but stated that 
significant changes to current municipal market practices would be 
needed to put the information flow in the two markets on an equal 
footing.
---------------------------------------------------------------------------

    AGFS suggested that the ``access equals delivery'' concept only be 
available in transactions in which investors have had actual access to 
the preliminary official statement, either through physical delivery or 
by providing consent to electronic delivery. In addition, AGFS 
suggested that dealers be required to circulate the official statement 
if there have been material changes made from the preliminary official 
statement. AGFS also warned that, once the cost savings from not 
preparing a printed official statement become apparent, some situations 
may arise where further cost savings are sought by foregoing the 
preparation of printed preliminary official statements as well.
    As noted above, the MSRB agrees that there is considerable value in 
ensuring access to the preliminary official statements, particularly in 
connection with ensuring that customers receive material disclosures at 
or prior to the time of trade and in sufficient time to make use of the 
information in coming to an investment decision.\82\ The MSRB expects 
to provide the opportunity for voluntary submissions of and access to 
preliminary official statements through EMMA, consistent with the 
MSRB's statutory authority, pursuant to a future filing with the 
Commission. However, the MSRB believes that the ``access equals 
delivery'' standard to be effectuated for the municipal securities 
market should not create a dual distribution paradigm and should not be 
preconditioned on deliveries of preliminary official statements.
---------------------------------------------------------------------------

    \82\ See footnote 15 supra.
---------------------------------------------------------------------------

    Offerings to Which ``Access Equals Delivery'' Standard Should 
Apply. Many commentators believed that ``access equals delivery'' 
should apply to all issues of municipal securities.\83\ However, some 
commentators argued that the ``access equals delivery'' standard should 
not apply to certain categories of offerings, as discussed below:
---------------------------------------------------------------------------

    \83\ Bernardi, brokersXpress, Commerce, DPC, First Southwest, 
Hilliard Lyons, NABL, UMB, Wells Fargo, Zions.
---------------------------------------------------------------------------

    Limited offerings under Exchange Act Rule 15c2-12(d)(1)(i). AMS and 
DPC believed that underwriters should be required to submit all limited 
offering official statements to the centralized electronic system for 
public dissemination. DPC stated that removing the exemption for 
limited offerings would better serve the interests of the market as a 
whole and would favor transparency. SIFMA and NABL believed that 
limited offerings should not be required to participate in the 
centralized electronic system, although SIFMA acknowledged that there 
were differing opinions on this issue.\84\ SIFMA and NABL were 
concerned about limited offerings that represent ``private placements'' 
where the issuer and underwriter did not intend on making a public 
offering and sought not to have the official statement broadly 
disseminated. SIFMA suggested that a submission requirement also could 
serve as a disincentive to producing official statements for such 
offerings. SIFMA recognized that dealers selling securities issued in a 
limited offering would not be able to rely on the access equals 
delivery standard but would instead be required to provide physical 
delivery of official statements to customers. SIFMA recognized that 
including limited offerings in the centralized electronic system would 
make information about the securities more widely available in 
connection with secondary market trading and therefore suggested 
permitting voluntary submissions of official statements for limited 
offerings for this purpose. NABL also believed that voluntary 
submissions should be allowed. NABL suggested that, if the MSRB were to 
require submission of official statements for limited offerings, the 
MSRB could provide for access to the official statement with password 
restriction if requested by the underwriter.
---------------------------------------------------------------------------

    \84\ BMA (now SIFMA) had originally stated in response to the 
Concept Release that the ``access equals delivery'' model should not 
apply to limited offerings exempt under Rule 15c2-12(d)(1)(i) 
because there is no reason for public access to disclosures for such 
offerings. SIA and UBS stated that they agreed with the positions 
set forth in BMA's comment letter. Griffin Kubik, which supported 
BMA's comments on all other issues, explicitly disagreed with BMA on 
this point. Griffin Kubik suggested, however, that if such an 
exception is provided, underwriters should be able to use the 
``access equals delivery'' model for limited offerings on a 
voluntary basis.
---------------------------------------------------------------------------

    NABL and SIFMA supported the modified provisions for handling 
limited offerings, as described in the November 2007 Notice, where an 
underwriter submitting the official statement to the dissemination 
system would trigger the ``access equals delivery'' standard but an 
underwriter election to withhold submission of the official statement 
for a limited offering would trigger a requirement that the underwriter 
submit a certification affirming that the issue meets all of the 
requirements of Rule 15c2-12(d)(1)(i) as a limited offering; a notice 
that the official statement is not available on-line but that the 
underwriter would provide a copy to any purchasing

[[Page 15206]]

customer; and contact information for requesting copies of the official 
statement.
    The MSRB has determined to include such modified provisions in the 
proposed rule change. Thus, revised Rule G-32(b)(i)(E) would permit the 
underwriter of a limited offering to elect to withhold submission of 
the official statement to EMMA if it submits the following to EMMA: (i) 
A notice that the offering is exempt from Exchange Act Rule 15c2-
12(d)(1)(i) as a limited offering; (ii) notice that the official 
statement has been prepared but is not being submitted to EMMA by the 
underwriter; and (iii) specific contact information for underwriter 
personnel to whom requests for copies of the official statement should 
be made. The underwriter would be required to deliver the official 
statement to each customer purchasing such securities upon request by 
the later of one business day after the request or the settlement of 
the customer's transaction.
    Commercial paper. Revised Rule G-32 would eliminate an existing 
exemption for commercial paper from the requirement that dealers 
provide an official statement to customers since such official 
statements would now be available through the centralized electronic 
system. DPC supported eliminating the commercial paper exemption. SIFMA 
recommended excluding commercial paper from the definition of ``new 
issue municipal securities'' because it believed that the rule language 
would require the underwriter to file a notice that no official 
statement is being prepared for each rollover where no new disclosure 
is produced. NABL opposed elimination of the commercial paper exemption 
but supported voluntary submission of commercial paper official 
statements to the centralized electronic system. The MSRB has 
determined to eliminate the exemption for commercial paper that 
currently exists under the new issue disclosure requirement of Rule G-
32 but to retain a limitation on the requirement to submit the official 
statement to the MSRB for commercial paper roll-overs where there is no 
new disclosure document produced under revised Rule G-32(b)(i)(D).
    Municipal fund securities. BMA and SIA stated that the ``access 
equals delivery'' model should not apply to 529 college savings plans 
and other municipal fund securities because mutual funds were excluded 
by the Commission from the ``access equals delivery'' standard for 
registered offerings. SIA stated that the MSRB would benefit by 
deferring any action with respect to municipal fund securities until 
further information is available regarding how the Commission would 
approach extending the ``access equals delivery'' standard to mutual 
funds.\85\ ICI stated that it supported increased reliance on 
electronic disclosure for mutual funds and 529 college savings plans, 
recommending that the MSRB consider the Commission's ongoing initiative 
with respect to mutual fund disclosure rules in moving forward on the 
``access equals delivery'' model.
---------------------------------------------------------------------------

    \85\ SIA stated that if the Commission extends ``access equals 
delivery'' to mutual funds, it might include municipal fund 
securities within its scope and, if not, the Commission approach as 
designed for mutual funds could serve as a template for the MSRB 
extending ``access equals delivery'' to municipal fund securities.
---------------------------------------------------------------------------

    In contrast, USAA stated that 529 college savings plan disclosure 
materials should not be excluded from the ``access equals delivery'' 
standard, stating that this model is particularly appropriate for such 
offerings because Internet access and usage by investors in 529 college 
savings plans is significantly higher than the percentages noted by the 
Commission in justifying adoption of the ``access equals delivery'' 
standard for the registered market. USAA stated that paper delivery of 
disclosure materials for 529 college savings plans could actually 
hamper the efficient and timely delivery of information to the sources 
on which 529 college savings plan investors rely. CSPN noted several 
issues unique to the 529 college savings plan market that the ``access 
equals delivery'' model would raise, including the Commission's stance 
toward prospectus dissemination for mutual funds. In view of these 
factors, CSPN suggested that the MSRB retain a presumption that 529 
college savings plan disclosure documents would be physically delivered 
to customers but that customers may opt-in to an ``access equals 
delivery'' model for 529 college savings plans. CSPN added that, 
because 529 college savings plan disclosure documents are already 
available as PDF files on the issuers' Web sites, implementation of the 
``access equals delivery'' for 529 college savings plans would not be 
difficult.
    The MSRB has determined to require that the underwriter or primary 
distributor for 529 college savings plans and other municipal fund 
securities submit the official statement electronically for display on 
the EMMA portal. However, dealers selling such securities to customers 
would not be permitted to rely on the ``access equals delivery'' 
standard, thereby generally requiring physical delivery of the official 
statement.\86\
---------------------------------------------------------------------------

    \86\ Although the ``access equals delivery'' model would not be 
available for municipal fund securities, electronic official 
statements could still be used to fulfill the official statement 
delivery requirement under prior guidance concerning the use of 
electronic communications where standards for notice, access and 
evidence to show delivery are met. See the 1998 Electronic Delivery 
Notice, supra footnote 48.
---------------------------------------------------------------------------

    Notice to Customers. The January 2007 Notice sought comment on a 
provision that would require dealers to provide to customers, within 
two business days following trade settlement, either a copy of the 
official statement or a written notice advising as to how to obtain the 
official statement from the central dissemination system and that a 
copy of the official statement would be provided upon request. Some 
commentators stated that the timing for providing such notice should 
match the requirement for such notice for registered offerings (i.e., 
within two business days of trade settlement).\87\ Edward Jones and UMB 
suggested that the MSRB should permit such disclosure to be made on the 
trade confirmation,\88\ and UMB asked if there are specific 
requirements as to how such notice should be given. Other commentators 
stated that the timing should remain unchanged from the current 
official statement delivery timeframe set forth in Rule G-32 (i.e., by 
trade settlement).\89\
---------------------------------------------------------------------------

    \87\ BMA, brokersXpress, Texas MAC, Zions. Griffin Kubik, SIA 
and UBS stated that they agreed with the positions set forth in 
BMA's comment letter.
    \88\ BMA noted that notice generally would be given by 
confirmation disclosure comparable to the ``access equals delivery'' 
practice in the registered market.
    \89\ NABL, Wells Fargo.
---------------------------------------------------------------------------

    The MSRB has determined that the timing of the notice for customers 
should permit a process for providing such notices that is similar to 
the processes currently used in connection with certain types of 
registered offerings under the Securities Act. Therefore, the MSRB has 
provided in the rule change proposal that the notice must be provided 
or sent by trade settlement. The MSRB notes that this notice timing is 
independent of the timing for official statements to be made available 
to investors and the general public for free on EMMA, where official 
statements will become available within one business day of receipt 
from the issuer but no later than the first settlements of trades in 
the securities upon closing of the underwriting.
    The January 2007 Notice proposed that the specific URL for an 
official statement be included in the notice to be delivered to a new 
issue customer

[[Page 15207]]

with respect to the availability of the official statement through the 
centralized electronic system. SIFMA, AMS and Bernardi opposed the use 
of document-specific URLs, instead suggesting a more general referral 
in the customer notice to the centralized electronic portal where 
investors would use a search function to locate the specific official 
statement.\90\ Bernardi stated that, if unique URLs are ultimately 
required, such URLs should be as short as possible and be based on 
characteristics, such as CUSIP number, that would allow an automated 
method for notifying customers of such URLs. NABL stated that, if used, 
the system should be designed to ensure that unique URLs do not inhibit 
the ability of the public to undertake searches to find official 
statements. SIFMA provided several examples of difficulties that would 
arise if document-specific URLs were required. In addition to 
eliminating the requirement of identifying such URL on the customer 
notice, SIFMA recommended that ``a short, generic, plain English 
statement comparable to the corporate reference to a `registration 
statement''' be used. SIFMA also suggested that the MSRB confer with 
the industry on operations issues regarding the formatting of such 
customer notice.
---------------------------------------------------------------------------

    \90\ Other commentators, although not directly addressing this 
issue, appeared by inference also to oppose or to be uncomfortable 
with the concept of requiring that official statements be identified 
by a unique URL.
---------------------------------------------------------------------------

    The November 2007 Notice proposed a revised version of this 
provision under which the notice obligation would be presumptively 
fulfilled if the dealer's notice to its customer provides the URL for 
the specific official statement or for the search page of an access 
portal at which such official statement may be found using the search 
function. SIFMA noted that dealers would expect to include the notice 
to customers on the confirmation as in the corporate market. SIFMA 
suggested that the following language be viewed as satisfying the 
notice requirement: ``Official statement can be accessed at http://www.MSIL-Access.com at or before the date of settlement. Printed copies 
will be provided upon request.'' NABL suggested that if a notice 
provides the URL for a search page rather than for the official 
statement itself, ``such notice also include the appropriate data 
entry, if any is needed, to navigate from the search page to the OS 
sought.''
    Under subsection (a)(iii) of revised Rule G-32 as proposed by the 
MSRB, a dealer would be required to provide or send to the customer, by 
settlement, either a copy of the official statement or a written notice 
advising the customer how to obtain the official statement from the 
EMMA portal and that a copy of the official statement would be provided 
upon request.\91\ This obligation to provide the first portion of the 
customer notice regarding how to obtain the official statement would be 
presumptively fulfilled if the notice provides (i) the URL for the 
specific EMMA portal page from which the official statement may be 
viewed and downloaded \92\ or (ii) the 9-digit CUSIP number for the 
security and the URL for the EMMA portal search page through which a 
search based on such CUSIP number may be undertaken.\93\ Revised Rule 
G-32(d)(x) would define qualified portal to mean an Internet-based 
utility providing access by any purchaser or potential purchaser of 
offered municipal securities to the official statement for such offered 
municipal securities in a designated electronic format, and allowing 
such purchaser or potential purchaser to search for (using the nine-
digit CUSIP number and other appropriate search parameters), view, 
print and save the official statement, at no charge, for a period 
beginning on the first business day after such official statement 
becomes available from EMMA and ending no earlier than 30 calendar days 
after the end of the primary market disclosure period for such offered 
municipal securities; provided that any such utility shall not be a 
qualified portal unless notice to users that official statements are 
also available from EMMA and a hyperlink to EMMA are posted on the page 
on which searches on such utility for official statements may be 
conducted.
---------------------------------------------------------------------------

    \91\ Dealers may, but are not required to, provide the notice on 
or with the trade confirmation provided to customers under Rule G-
15(a)(i), so long as the timing requirement is met. Dealers also 
would be permitted to include in the notice information regarding 
the availability of the official statement from a qualified portal.
    \92\ Customers should be directed to the appropriate ``Issue 
Details'' or ``Security Details'' page, rather than directly to the 
PDF file of the official statement, as such detail pages provide 
users with the opportunity to view whether the original official 
statement has been supplemented or amended.
    \93\ The search page on the current pilot EMMA portal is at 
http://www.emma.msrb.org/Search/Search.aspx. Dealers providing links 
to the appropriate search page must ensure that they provide the 
then current URL.
---------------------------------------------------------------------------

    Submissions of Preliminary Official Statements and Other Items. 
SIFMA,\94\ along with AMS, DPC, Ipreo, NABL, TRB, UMB and Zions, 
supported the concept of voluntary submissions of preliminary official 
statements. DPC suggested that the MSRB explore making the submission 
of all preliminary official statements mandatory, while SIFMA, AMS and 
NABL emphasized that preliminary official statement submissions should 
not be made mandatory. SIFMA and DPC noted the importance of ensuring 
version control where both preliminary official statements and official 
statements are made available (as well as in handling ``stickers'' to 
official statements), suggesting that the MSRB include a mechanism for 
notification to the public when the final official statement is posted 
in cases where a preliminary official statement has previously been 
submitted. DPC suggested that preliminary official statements be 
deleted when final official statements are submitted, while NABL 
suggested that underwriters be permitted to request that the 
preliminary official statement be removed from the centralized 
electronic system once the ``timeliness of a POS has ended,'' noting 
that its continued availability may confuse investors. However, SIFMA 
opposed the removal of the preliminary official statement.
---------------------------------------------------------------------------

    \94\ Bear Stearns and Griffin Kubik stated that they 
participated in the formulation of SIFMA's comments and fully 
supported SIFMA's positions.
---------------------------------------------------------------------------

    The MSRB is precluded from mandating pre-sale submission of 
preliminary official statement pursuant to Exchange Act Section 
15B(d)(1). Under the rule change proposal, preliminary official 
statements, if available, would be required to be submitted by the 
underwriter by closing solely in the circumstance where an official 
statement is not being prepared by the issuer or if the official 
statement is not available for submission to EMMA by the closing. Once 
the official statement is provided by the underwriter, the preliminary 
official statement generally would be moved to a document archive that 
would be accessible through the EMMA portal directly from the page 
where the link to the official statement is provided. Users of the EMMA 
portal would be able to request to receive e-mail notifications for 
updates to the disclosure document for a specific security, which would 
apply to the situation where an official statement is submitted to EMMA 
following an initial submission of the preliminary official statement. 
The MSRB expects to consider expanding the EMMA primary market 
disclosure service to accept voluntary submissions of preliminary 
official statements in the future.
    Several commentators stated that amendments to official statements 
should be included in the ``access equals delivery'' framework,\95\ and 
that

[[Page 15208]]

advance refunding documents also should be included within the 
framework.\96\ BMA noted that investors should be informed of any 
amendments to a submitted official statement, and BMA and AGFS 
suggested the possibility of highlighting changes made in updated 
submissions from an earlier submission. BMA and DPC emphasized the 
importance of tracking and properly linking amendments and the original 
official statements to which they relate.
---------------------------------------------------------------------------

    \95\ BMA, CSPN, DPC, Texas MAC, NFMA.
    \96\ BMA, Texas MAC.
---------------------------------------------------------------------------

    The rule change proposal would require underwriters to submit to 
EMMA any amendments to the official statement occurring during the 
primary offering disclosure period, which ends 25 days after closing. 
The amendment would be displayed, along with the original official 
statement, on the EMMA portal and would be made available for download 
by EMMA portal users in a single compacted folder. Users of the EMMA 
portal would be able to request to receive e-mail notifications for 
updates to the disclosure document for a specific security, which would 
apply to the situation where an official statement is subsequently 
amended.
    Format of Official Statements. PDF was the preferred official 
statement format of most commentators.\97\ Some commentators suggested 
that other official statement formats also should be accepted,\98\ with 
Wells Fargo emphasizing that PDF is the licensed product of a single 
software vendor and, although popular, the municipal securities 
industry should not encourage a situation that may require firms to 
purchase essential technology from only one vendor. Other commentators 
stated that the system should have the flexibility to allow new formats 
that may in the future meet or exceed the current parameters for 
PDF.\99\ RMOA believed a single format should be prescribed, and other 
commentators believed that allowing multiple formats could prove 
problematic.\100\ Zions stated that other electronic formats that may 
require specific formatting, such as hypertext markup language (html) 
or ASCII (American Standard Code for Information Interchange), would be 
unacceptable. However, ADP stated that the Concept Release does not 
discuss the benefits to market participants of Extensible Business 
Reporting Language (XBRL) and TRB suggested that PDF does not permit 
analysis and comparison between different investments. UBS observed 
that submissions using files that originate electronically yield 
smaller, better quality files than do scanned files, and that larger 
scanned files can sometimes cause technological difficulties, 
particularly for smaller retail customers. UBS suggested that the MSRB 
and industry remain cognizant of any emerging, widely utilized, non-
proprietary, freely available format that would retain the desirable 
characteristics of PDF documents but create smaller scanned files.
---------------------------------------------------------------------------

    \97\ Bernardi, BMA, brokersXpress, CSPN, Commerce, DPC, Edward 
Jones, Hilliard Lyons, Morgan Keegan, Texas MAC, NABL, UBS, UMB, 
Wells Fargo, Zions. Griffin Kubik and SIA stated that they agree 
with the positions set forth in BMA's comment letter.
    \98\ Bernardi, Wells Fargo.
    \99\ BMA, Edward Jones, Texas MAC, UBS, Zions. Griffin Kubik and 
SIA stated that they agreed with the positions set forth in BMA's 
comment letter.
    \100\ DPC, NABL, UBS, Zions.
---------------------------------------------------------------------------

    SIFMA, AMS, DPC, Ipreo and NABL generally agreed with the approach 
of initially requiring that all documents be provided as PDF files, 
although flexibility should be retained to permit other appropriate 
file formats as they are developed and become available for general 
public use. With regard to formats other than PDF that may be developed 
in the future, NABL suggested the following as basic parameters before 
permitting such format to be used for official statements: (i) Software 
to read files should be free, user-friendly and readily available; (ii) 
software should protect the integrity of files; and (iii) consumers 
should be familiar with the format before adoption.
    In the November 2007 Notice, the MSRB proposed that all documents 
be submitted in a designated electronic format, meaning that the 
document must be in an electronic format acceptable to the MSRB, word-
searchable, and must permit the document to be saved, viewed, printed 
and retransmitted by electronic means using software generally 
available for free or on a commercial basis to non-business computer 
users. PDF files that are word-searchable and may be saved, viewed, 
printed and retransmitted by electronic means would be deemed to be in 
a designated electronic format. GFOA ``strongly encourage[s] 
standardization on the PDF format.'' GFOA believed that readily 
available technology currently exists to make all PDF files word 
searchable, including scanned PDF files. GFOA stated, ``Future success 
of this system requires that it start with the best technology 
available and its ongoing challenge will be to keep up with changing 
technology while allowing backwards compatibility and conversion.'' 
SIFMA supported the revised definition but observed that neither the 
MSRB nor the Commission has the authority to mandate that issuers 
produce documents in a specific format. SIFMA also noted that not all 
portions of an official statement may be word-searchable, particularly 
if they include images. NABL recommended against including the 
requirement that PDF files be word-searchable since many documents that 
pre-date the new rule would still have to be submitted to the new 
system but would not be in such format.
    The MSRB has determined to initially limit submissions of documents 
to the EMMA primary market disclosure service to PDF files, configured 
to permit documents to be saved, viewed, printed and retransmitted by 
electronic means. If the submitted file is a reproduction of the 
original document, the submitted file must maintain the graphical and 
textual integrity of the original document. In addition, starting on 
January 1, 2010, such PDF files must be word-searchable (that is, 
allowing the user to search for specific terms used within the document 
through a search or find function available in most standard software 
packages), provided that diagrams, images and other non-textual 
elements would not be required to be word-searchable. Implementation of 
this requirement would be deferred to provide issuers, underwriters and 
other relevant market participants with sufficient time to adapt their 
processes and systems to provide for the routine creation or conversion 
of primary market disclosure documents as word-searchable PDF files. 
The MSRB understands that software currently is generally available for 
free that permits users to save, view and print PDF files, as well as 
to conduct word searches in word-searchable PDF documents. The MSRB has 
provided links for downloading such software on the pilot EMMA portal 
and would continue to do so in the future.
    The MSRB notes that documents converted into PDF files from other 
electronic formats can generally be made word-searchable through such 
conversion process, although this may not be the case where the PDF 
file is created by scanning paper versions of original documents. 
Documents originally authored as PDF files or converted into PDF files 
from other electronic formats (sometimes referred to as ``native PDF'' 
or ``PDF normal'') generally are made word-searchable through such 
conversion process. On the other hand, PDF files created by scanning 
paper versions of original documents generally can be made word-
searchable only through an optical character recognition or other 
comparable process (``OCR'').

[[Page 15209]]

Documents submitted to EMMA that have been made word-searchable through 
an OCR process must maintain the graphical and textual integrity of the 
original document. This would typically be achieved by creating a 
single document that includes both a scanned image of the original 
document and a transparent layer consisting of the word-searchable OCR 
output (sometimes referred to as a ``PDF searchable image'' file). 
Submitters should not submit documents consisting of a visible word-
searchable OCR output (sometimes referred to as ``formatted text and 
graphics'') as such output generally does not maintain with sufficient 
accuracy the graphical and textual integrity of the original document 
without significant post-scanning manual processing by the producer of 
the document. The MSRB would strongly encourage submitters to submit 
all documents to EMMA as native PDF or PDF normal files, which by their 
nature are word-searchable and also would provide benefits to the 
submitter in that such files generally are more easily created and 
result in substantially smaller file size (thereby speeding the 
submission process) than scanned PDF searchable image files. Native PDF 
or PDF normal files also would provide benefits to EMMA users because 
of their smaller, more easily downloadable file size.
    The MSRB may in the future determine to designate additional 
computerized formats as acceptable electronic formats for submission or 
preparation of documents under Revised Rule G-32 by means of a filing 
with the Commission. The MSRB anticipates that any such additional 
designated electronic formats would permit documents to be saved, 
viewed, printed and retransmitted by electronic means, using software 
generally available at the time such document is provided under this 
rule for free or on a commercial basis to non-business computer users, 
and such documents are substantially word-searchable (without regard to 
diagrams, images and other non-textual elements).
    In addition, the MSRB supports the Commission's Interactive Data 
and XBRL Initiatives for registered offerings. Although the MSRB would 
initially accept documents solely as PDF files and would not be in a 
position to accept documents or data in XBRL format upon launch of the 
primary market disclosure service, the MSRB would seek to explore with 
other industry participants the possibility of incorporating into the 
permanent system at a later date an option to make submissions using 
XBRL once appropriate taxonomies for the municipal marketplace have 
been developed and as issuers begin the process of producing primary 
market disclosure documents using XBRL.
    Accessibility of Official Statements. Most commentators stated that 
official statements should remain publicly available for the life of 
the securities.\101\ Some commentators noted that, although financial 
and operating information in official statements quickly becomes stale, 
many portions of the official statement remain useful throughout the 
life of a bond issue.\102\ BMA stated that the financial and operating 
information included in the official statement serve as valuable points 
of reference when reviewing secondary market financial and operating 
information provided to nationally recognized municipal securities 
information repositories pursuant to Exchange Act Rule 15c2-12.\103\ 
UBS suggested that appropriate disclaimers be used with respect to the 
potential staleness of information beyond the current new issue 
disclosure period. RMOA stated that official statements could be made 
available for free during the 25-day new issue disclosure period and a 
fee could be charged for access after that period. Other commentators 
stated that making the official statements available solely for the 
current 25-day new issue disclosure period would be sufficient,\104\ 
with DPC stating that maintaining public access beyond this 25-day 
period would impair the economic interests of information vendors that 
currently make official statements available on a commercial basis and 
would ultimately negatively impact the marketplace.
---------------------------------------------------------------------------

    \101\ Bernardi, BMA, Griffin Kubik, Morgan Keegan, NABL, NFMA, 
RMOA, SIA, Texas MAC, UBS, UMB, Wells Fargo, Zions.
    \102\ BMA, Griffin Kubik, NFMA, RMOA, SIA, Texas MAC, UBS.
    \103\ Griffin Kubik, SIA and UBS agreed.
    \104\ brokersXpress, Commerce, DPC, First Southwest.
---------------------------------------------------------------------------

    The MSRB agrees that there is significant value to maintaining 
official statements available for the life of the securities and 
therefore would make official statements available through the EMMA 
portal for the life of the securities. The MSRB also agrees with the 
approach taken by the Commission in the registered securities market of 
providing such access to disclosure at no charge to the public. The 
MSRB believes that a free flow of basic disclosure information to all 
market participants on an equal basis is essential to pursuing one of 
the MSRB's congressionally mandated core functions of removing 
impediments to and perfecting a free and open market in municipal 
securities. By making these basic disclosure documents--most of which 
exist and are available to commercial enterprises solely by virtue of 
the mandates set forth by the Commission in its Rule 15c2-12--also 
available to the general public for free, the MSRB does not in any way 
inhibit the free market in value-added services based on such 
documents.\105\
---------------------------------------------------------------------------

    \105\ See also section 4 of this filing.
---------------------------------------------------------------------------

    Data Elements and Search Function. Some commentators suggested that 
the information submitted on Form G-36(OS) should be made available to 
the public.\106\ UBS noted that Form G-36 data should be used to 
develop a flexible indexing system, perhaps using XML, to allow for 
searches on a broad range of fields. NFMA also emphasized the 
importance of the search function. TRB stated that a cover sheet 
including primary information such as issuer, CUSIP numbers, security, 
maturity dates, ratings, callability, etc. is needed. TRB believed that 
the task of creating a data base from such information that is 
available to investors would be the most significant contribution that 
could be made by the MSRB to the municipal marketplace. EDGAR Online 
suggested that the following items of information be captured in 
connection with each OS submission: CUSIP number, date of issue, 
issuer, issuer state, original par amount, type of bond, type of 
security, description of issuer (1-2 paragraphs), description of use of 
proceeds (1-2 paragraphs) and description of bond security (1-2 
paragraphs). In addition, EDGAR Online suggested the following search 
criteria: CUSIP number, date of issue, issuer, issuer state, original 
par amount, type of bond and full text search. DPC suggested that the 
required data be captured in formatted fields and that such data be 
parsed automatically into XML for distribution.
---------------------------------------------------------------------------

    \106\ BMA, RMOA, TRB.
---------------------------------------------------------------------------

    New Form G-32 would request a number of key items of information 
from underwriters making submissions to EMMA, as described in section 
3(a) of this filing above, in order to properly identify the document 
being submitted, to ensure that such document is associated with the 
appropriate securities, and to provide for an effective search function 
on the EMMA portal. The EMMA portal would initially permit users to 
search for documents based on CUSIP number, issuer name, issue 
description, state, maturity date, issuance date and interest rate, and 
such search capabilities might be expanded in the future. The MSRB 
would use data submitted by underwriters to EMMA and other data

[[Page 15210]]

sources for purposes of the search function but does not intend on 
itself extracting information from submitted documents for this 
purpose.
    With regard to the MSRB's request for comment in the January 2007 
Notice regarding a potential requirement that underwriters submit on 
Form G-32 the names of syndicate members as a means by which to pre-
populate a portion of each syndicate member's Form G-37 under Rule G-
37, AMS supported such a process, but SIFMA, on balance, suggested that 
the MSRB not include a Form G-37 process at this time. The MSRB has 
determined not to seek such information.
    Submission Process. Some commentators suggested that the current 
timeframes under Rule G-36 for submission of official statements to the 
MSRB--no later than 10 business days after the bond sale for issues 
subject to Exchange Act Rule 15c2-12 and the later of one business day 
after receipt or one business day after closing for issues exempt from 
Rule 15c2-12--be retained.\107\ BMA suggested expanding certain 
exceptions to the 10 business day timeframe. However, other 
commentators supported a single deadline for all issues of the bond 
closing date.\108\ Bernardi suggested that, in those instances where 
the official statement is not available by the bond closing, the 
preliminary official statement should be submitted.\109\
---------------------------------------------------------------------------

    \107\ BMA, First Southwest. Griffin Kubik, SIA and UBS stated 
that they agreed with the positions set forth in BMA's comment 
letter.
    \108\ Bernardi, brokersXpress, Morgan Keegan, NABL, Wells Fargo, 
Zions.
    \109\ AGFS would require the submission of the preliminary 
official statement as a precondition to applying the ``access equals 
delivery'' standard to official statement deliveries.
---------------------------------------------------------------------------

    The January 2007 Notice stated that the new Form G-32 submission 
process would be initiated by the submission of CUSIP number 
information and initial offering prices for each maturity shortly after 
the bond sale. This timing was designed to coincide with the timing 
under Rule G-34 relating to CUSIP numbers and other new issue 
information requirements, with the intention that this submission 
timing would coincide with the timing of information submissions to 
NIIDS. SIFMA agreed that the MSRB should coordinate the finalization of 
the timeframe for information submissions on Form G-32 with information 
submission requirements that would be established with respect to NIIDS 
but that the requirement should be timed to coordinate with successful 
testing of NIIDS. SIFMA recommended that this part of the proposed rule 
be delayed until NIIDS has been tested and dealers are able to use the 
system. DPC supported the proposed timeframe, although it points out 
that the system would need to be able to initiate a filing without 
CUSIP numbers if it were to accept preliminary official statement 
submissions. AMS would prefer maintaining the current timing for 
information submissions.
    BMA and UBS noted that the submission process should be made to 
conform to the straight through processing ideal that each document or 
item of information needed by multiple parties should only be required 
to be submitted by the underwriter once, and also seeks a more user-
friendly format for submissions. However, BMA believed that 
underwriters should remain primarily responsible for submission and 
that the responsibility for submission should not be shifted to dealer 
financial advisors in those issues where such a financial advisor is 
involved. Wells Fargo and Zions disagreed, stating that if the 
financial advisor prepares the official statement, it should have 
primary responsibility for submitting the official statement. Some 
commentators noted difficulties with independent financial 
advisors,\110\ with Hilliard Lyons suggesting that a solution would be 
to petition the Commission to bring them under the regulatory control 
of the Commission or MSRB. BMA and RMOA believed that e-mail 
attachments should be an acceptable method of submission. Several 
commentators mentioned the importance of return receipts for official 
statement submissions and/or the ability of submitters to review their 
submissions.\111\
---------------------------------------------------------------------------

    \110\ Hilliard Lyons, Morgan Keegan.
    \111\ NFMA, Texas MAC, UBS.
---------------------------------------------------------------------------

    The MSRB has determined to establish a single timeframe for 
submissions of official statements to EMMA for all types of primary 
offerings, being one business day after receipt but no later than the 
closing date. Underwriters would be required to initiate the Form G-32 
submission process by the date of first execution, which would be 
defined under revised Rule G-32(d)(xi) as the date on which the 
underwriter executes its first transactions with a customer or another 
dealer in any issue security offered in a primary offering. In the case 
of new issues where the underwriter is required under Rule G-
34(a)(ii)(C) to provide new issue information to NIIDS, such date of 
first execution would mean the date corresponding to the Time of First 
Execution (being no less than two hours after all such information has 
been transmitted to NIIDS), as defined in Rule G-34(a)(ii)(C)(1)(b). 
For purposes of the timing for initiating the Form G-32 submission 
process under Rule G-32(b)(i)(A) and (b)(vi)(C)(1)(a), the date of 
first execution would be deemed to occur by no later than the closing 
date, even if the date of first execution would be a later date under 
Rule G-34. In most cases, the submission process would be initiated by 
submission of the CUSIP numbers, initial offering prices and certain 
other basic identifying information, although the Form G-32 submission 
requirements would provide alternative information submission 
requirements for cases where the securities are not eligible for CUSIP 
number assignment or for other types of offerings, such as commercial 
paper issues, issues of municipal fund securities, and remarketings, as 
described in section 3(a) of this filing above.
    The MSRB is proposing to permit underwriters to designate agents to 
submit documents and related information to EMMA, thereby permitting 
underwriters to structure their submission process in the manner that 
is most efficient for their purposes. Although underwriters would not 
be able to fulfill their information submission requirements under 
revised Rule G-32 and Rule G-34 with a single submission of such 
information to NIIDS upon initial launch of the EMMA primary market 
disclosure service, the MSRB anticipates providing such functionality 
at a future date. Underwriters would be responsible for the accuracy, 
completeness and timeliness of information they or their agents provide 
to EMMA.
    Structure of the Centralized Electronic System. The Concept Release 
sought comment on whether the central access utility should host all 
official statement documents or should serve as a central directory of 
official statements with hyperlinks to documents hosted by other 
entities that have undertaken to maintain access to such documents. The 
Concept Release also sought comment on whether the MSRB should 
undertake the central access function, or whether other market 
participants or vendors could undertake such function subject to 
appropriate supervision.
    Nearly all commentators responding to the Concept Release stated 
that the central access facility should post official statements 
directly on a central Web site, rather than serving as a directory of 
links to official statements posted by underwriters, issuers, financial 
advisors, printers or others at

[[Page 15211]]

other sites.\112\ Some commentators noted that a decentralized system 
with a central hyperlinked directory could be problematic with regard 
to ensuring continuous access, uniformity of handling and ease of 
use.\113\ Morgan Keegan stated that a decentralized model could be 
acceptable if access and data input requirements are uniformly applied 
to all vendors, but that long-term free access would be problematic. 
TRB stated that it would be more effective to link the MSRB Web site to 
the appropriate posting site for each official statement, with the MSRB 
monitoring and/or restricting these posting sites. UMB asked whether it 
would be able to direct its customers to its own Web site, from which 
it would link to the central access facility.
---------------------------------------------------------------------------

    \112\ Bernardi, BMA, brokersXpress, Commerce, DPC, First 
Southwest, Hilliard Lyons, ICI, Morgan Keegan, NABL, NFMA, RMOA, 
Texas MAC, UBS, Wells Fargo, Zions. Griffin Kubik, SIA and UBS 
stated that they agreed with the positions set forth in BMA's 
comment letter.
    \113\ BMA, brokersXpress, DPC, ICI, NFMA, UBS, Zions. Griffin 
Kubik, SIA and UBS stated that they agreed with the positions set 
forth in BMA's comment letter.
---------------------------------------------------------------------------

    Most commentators felt that the MSRB could operate the central 
access facility,\114\ with several indicating that the MSRB was their 
first choice to do so.\115\ Many commentators suggested that the 
central access facility also could be operated by an outside contractor 
with oversight by the MSRB pursuant to contract.\116\ Wells Fargo 
stated that the MSRB should investigate a centralization function that 
would not unequally empower a single data vendor. NABL stated that 
proposed approaches by market participants and others would need 
careful consideration to determine the optimal choice for the municipal 
securities market, and RMOA stated that vendors offering their services 
would need to insure the industry that they would accept oversight by 
established regulatory authorities and would be subject to penalties 
for non-performance. UBS stated that, if an entity other than the MSRB 
operates the central access facility, the MSIL system's existing OS/ARD 
library and full database would need to be made available to such 
entity. ADP, DPC, S&P CUSIP and Texas MAC expressed a willingness to 
explore participation in the operation of the central access facility, 
with DPC and Texas MAC noting that the Commission operates EDGAR 
through contracts with commercial vendors. CSPN stated that a 
centralized Web-based disclosure utility for the 529 college savings 
plan market that it was developing would be the appropriate central 
access facility for the 529 college savings plan market. If 529 college 
savings plan disclosure documents were to be hosted on a Web site other 
than the CSPN utility or the 529 college savings plan's own Web site, 
CSPN stated that the issuers would need assurances that the offering 
materials delivered to such centralized Web site would become publicly 
available exactly as transmitted by the issuer or the primary 
distributor for the 529 college savings plan.
---------------------------------------------------------------------------

    \114\ Bernardi, BMA, Commerce, First Southwest, Hilliard Lyons, 
Morgan Keegan, NFMA, RMOA, UBS, Zions. Griffin Kubik and SIA stated 
that they agreed with the positions set forth in BMA's comment 
letter.
    \115\ Bernardi, Commerce, Hilliard Lyons, Morgan Keegan, RMOA, 
UBS, Zions. Morgan Keegan noted that the industry has already paid 
to establish the MSIL system and that the additional expense could 
be covered at the MSRB's discretion.
    \116\ BMA, First Southwest, NFMA, RMOA, Texas MAC. Griffin 
Kubik, SIA and UBS stated that they agreed with the positions set 
forth in BMA's comment letter.
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    Several commentators emphasized that, in deciding which entity 
should operate the central access facility, cost should be an important 
factor, including which parties should bear such costs, before 
additional build-out costs or ongoing filing fees are imposed.\117\ UBS 
stated that the ``access equals delivery'' processes needed to be 
further developed to enable an informed projection of benefits and 
costs. BMA emphasized the importance of how quickly and how cost-
effectively the central access facility could be made operational in 
deciding which entity launches the facility.\118\ Commerce noted that 
adequate lead-time should be allowed for dealers to upgrade their 
system and implement the proposal.
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    \117\ BMA, UBS. Griffin Kubik and SIA stated that they agreed 
with the positions set forth in BMA's comment letter.
    \118\ Griffin Kubik, SIA and UBS stated that they agreed with 
the positions set forth in BMA's comment letter.
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    The January 2007 Notice provided additional details of a proposed 
structure for the centralized electronic system that would build on the 
MSIL system to provide through an Internet-based central access 
facility an assured source for free access to official statements and 
other related documents and information in connection with all new 
issues. The MSRB noted in the January 2007 Notice that it would operate 
a public access portal that would post official statements and other 
documents and information directly on its centralized Web site and 
would make posted information available for free for the life of the 
securities to investors, other market participants and the general 
public. The January 2007 Notice stated that additional public access 
portals using the document collections from the MSIL system obtained 
through real-time subscriptions could be established by other entities 
as parallel sources to the public.
    AMS and UMB generally supported a single central electronic portal, 
while SIFMA, DPC, Ipreo, and NABL stated a preference that official 
statements be made available from multiple sources. NABL would not 
limit accessibility just through the centralized electronic portal but 
also to any source that (i) is either free or approved by the customer 
and (ii) maintains a record of posting. DPC expressed reservations that 
the MSRB's proposal would provide for official statements to be posted 
solely on the MSRB's centralized electronic portal, raising concerns 
regarding the reliability of a single source.
    With regard to the January 2007 Notice, DPC observed that, although 
official statements may be made available for free to those accessing 
them through the access portals, there would be a cost to the broker-
dealer community to subsidize the system's development and operation. 
DPC stated that having the industry subsidize the cost ``appears to be 
more biased and unfair than recovering the costs from the users of the 
system based on usage.'' DPC further stated that the EDGAR system, 
which ``is subsidized by American taxpayers,'' operates through vendors 
under contract with the Commission. DPC also stated that some aspects 
of the centralized electronic system's operations ``could be construed 
as interfering with standard commercial processes of private 
businesses.'' DPC viewed the MSRB's proposal that the customer notice 
provide an official statement's URL at an access portal as 
``prejudicial to the economic interests of existing vendors whose 
delivery services required that the definitive PDF file be archived on 
their Web sites for public access.'' DPC stated that providing official 
statements for free through access portals would ``impair the economic 
interests of information vendors that currently make OSs available on a 
commercial basis.''
    In response to the Pilot Filing submitted by the MSRB to the 
Commission, DPC noted that it is a Nationally Recognized Municipal 
Securities Information Repository (NRMSIR) that has made its municipal 
disclosure archive fully accessible on the Internet since 1999. DPC 
supported the broad concept of access equals delivery as a matter of 
general market efficiency. DPC stated:

    It is our opinion, however, that the MSRB's plans for its 
proposed [MSIL]-based Web portal go well beyond its organizational 
mandate as stated in section 15B(b)(2)(C) of

[[Page 15212]]

the 1934 Act. If the existing prototype and stated plans are an 
indication, the MSRB will not only be assuming the role of the 
Access Equals Delivery venue for the municipal marketplace, but will 
go much further, breaking new ground in providing enhanced services 
to the market by a capital markets regulatory body. This also would 
be an apparent violation of the SEC's long-held public policy that 
the MSRB should not compete with vendors in offering value-added 
features and services related to handling of disclosure documents.

    DPC compared certain functionalities illustrated on a sample pilot 
portal posted on the MSRB Web site to the functionalities offered by 
EDGAR and concluded that such ``features and capabilities are well in 
excess of the system that the MSRB has pointed to as its model, the 
SEC's own EDGAR.'' DPC asked why certain features on the sample pilot 
portal that it viewed as value-added--such as ``nine-digit CUSIP 
searches, hyperlinks to bond issuer[']s Web sites, an `alert' service 
to users of the portal, sophisticated document viewing options, links 
to other related documents in the portal[']s disclosure archive, and 
subsequent event notifications that equate to custom research''--are 
not being left to the competitive forces of the market. It viewed the 
MSRB's stated plans to provide free on-line access to an integrated 
display of primary market and other disclosure with transaction price 
data as breaking new ground as compared to the offerings of other self-
regulatory organizations. DPC noted the investments made by that firm 
and others to offer value-added services to the municipal securities 
market ``largely in reliance on the SEC's public statements that it is 
not in favor of the MSRB competing directly with vendors.'' DPC 
disagreed with the MSRB's view that EMMA would not create an unequal 
burden on competition. DPC also noted that at least one NRMSIR would be 
willing, under regulatory oversight, to make its disclosure archive 
available to the public for free for a modest annual subsidy to such 
NRMSIR. DPC concluded by urging ``the Commission to support the MSRB's 
proposed rule change that will promote Access Equals Delivery in the 
municipal securities market, but restrain the MSRB from offering value-
added content and features that will necessarily inflict economic harm 
on existing data vendors, and inflict the harm unevenly.''
    EDGAR Online stated:

    We believe that the current model of four Nationally Recognized 
Municipal Securities Information Repositories (NRMSIRs) severely 
limits innovation and access to these important disclosures. The 
current model locks up public documents in private hands while the 
proposed portal run by a public entity will encourage transparency 
in the municipal securities market and create a healthy ecosystem of 
information that will ultimately benefit both the investment 
community and the municipalities that seek access to public markets.

    EDGAR Online detailed its views regarding the limitations on public 
access to existing disclosures and on the ability of other information 
providers to re-disseminate such disclosures, stating:

    Ultimately, investors and the municipalities pay the price for 
this lack of a viable information ecosystem. The rigid control of 
public information dissuades other information providers from trying 
to enter or innovate for this market. This means that there are few 
people working on improving ease of use, depth of analysis, 
thoroughness of information or more effective means of delivery.

EDGAR Online recommended that the Commission create a publicly 
accessible storage and dissemination system for all municipal 
securities disclosure filings.

    The MSRB has carefully reviewed the statements made by these 
commentators and, as noted in section 3(b) of this filing as well as in 
the Pilot Filing, continues to believe that EMMA is consistent with its 
statutory mandate under the Act. The EMMA portal would provide free and 
timely public access to official statements and advance refunding 
documents, with such access to official statements being a fundamental 
element of the MSRB's planned ``access equals delivery'' standard for 
official statement dissemination to customers under the rule change 
proposal. Further, EMMA would remove impediments to and help perfect 
the mechanisms of a free and open market in municipal securities, 
assist in preventing fraudulent and manipulative acts and practices, 
and would in general promote investor protection and the public 
interest by ensuring equal access for all market participants to the 
disclosure information needed by investors in the municipal securities 
market.
    As described in greater detail in section 4 of this filing as well 
as in the Pilot Filing, the MSRB believes that EMMA would not impose 
any burden on competition not necessary or appropriate in furtherance 
of the purposes of the Act. In weighing the potential alternative 
approaches to implementing EMMA, the MSRB concluded that developing 
EMMA through the adaptation and upgrading of existing internal MSRB 
systems--including but not limited to the MSIL system, RTRS and the 
MSRB's in-house access control systems--combined with the creation of a 
custom user interface designed for use by retail investors, would be 
the most prudent and efficient manner of achieving the MSRB's goals for 
EMMA. Although the MSRB has determined to establish the EMMA portal, 
the EMMA portal need not operate as the sole source of official 
statements and other documents and information in the municipal 
securities market. Rather, private enterprises could establish separate 
services, whether as qualified portals or otherwise, to make available 
publicly the basic documents and information they obtain from EMMA, 
together with such other documents, information and utilities (e.g., 
indicative data, transaction pricing data, secondary market 
information, analytic tools, etc.) as each operator determines, 
provided on such commercial terms as may be appropriate for their own 
business model. The MSRB's goal in promoting broad dissemination of the 
documents and information made available through EMMA is to provide 
market participants with an effective opportunity to access official 
statements throughout the life of the securities in a non-cost 
prohibitive manner while encouraging market-based approaches to meeting 
the needs of investors and other participants in the municipal 
securities market.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    A. By order approve such proposed rule change, or
    B. Institute proceedings to determine whether the proposed rule 
change should be disapproved.

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

    <bullet> Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or

[[Page 15213]]

    <bullet> Send an e-mail to <a href="/cdn-cgi/l/email-protection#9ae8eff6ffb7f9f5f7f7fff4eee9dae9fff9b4fdf5ec"><span class="__cf_email__" data-cfemail="7200071e175f111d1f1f171c0601320117115c151d04">[email protected]</span></a>. Please include 
File Number SR-MSRB-2009-02 on the subject line.

Paper Comments

    <bullet> 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-2009-02. 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 Internet 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 inspection and 
copying 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 principal office of the MSRB. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-MSRB-2009-02 and should be 
submitted on or before May 4, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\119\
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    \119\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E9-7340 Filed 4-1-09; 8:45 am]
BILLING CODE


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