Document ID: SEC-2008-0409-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Municipal Securities Rulemaking Board
Posted Date: 2008-03-17T04:00Z

[Federal Register: March 17, 2008 (Volume 73, Number 52)]
[Notices]               
[Page 14292-14294]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17mr08-112]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57463; File No. SR-MSRB-2008-01]

 
Self-Regulatory Organizations; Municipal Securities Rulemaking 
Board; Notice of Filing and Immediate Effectiveness of Proposed Rule 
Change Relating to Amendment to Rule G-8, on Books and Records, To 
Delete Requirement To Maintain Copies of Form G-40

March 11, 2008.
    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 February 19, 2008, the Municipal Securities Rulemaking Board 
(``MSRB'' or ``Board'') 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 MSRB has filed the proposal as 
a ``non-controversial'' rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act,\3\ and Rule 19b-4(f)(6) thereunder,\4\ 
which renders the proposal effective upon filing with the Commission. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).

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[[Page 14293]]

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The MSRB is filing with the Commission a proposed rule change 
consisting of an amendment to Rule G-8, on books and records, to delete 
the requirement that brokers, dealers and municipal securities dealers 
maintain copies of Form G-40 and any amended forms as required by Rule 
G-40, on e-mail contacts. The MSRB proposes that the amendment become 
effective on March 21, 2008. The text of the proposed rule change is 
available on the MSRB's Web site (http://www.msrb.org), at the MSRB, 
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
    Subparagraph (a)(xxii) under Rule G-8, on books and records, 
requires that brokers, dealers and municipal securities dealers 
(``dealers'') keep records reflecting copies of Form G-40 and any 
amended forms as required by Rule G-40, on e-mail contacts. Rule G-40 
provides for electronic communication between the MSRB and dealers by 
imposing certain requirements on dealers.\5\ When the rule was first 
adopted in 2002, dealers were required to submit their initial forms by 
mail. The rule was subsequently amended in 2005 to require that all G-
40 submissions--both initial forms and any subsequent amendments--be 
submitted electronically to the MSRB. Dealers accomplish this through 
their individual electronic G-40 accounts. Because dealers are no 
longer required to provide any paper submissions in connection with 
Rule G-40, there is no reason to retain the current requirement under 
Rule G-8(a)(xxii) that dealers maintain copies of Form G-40 and any 
amended forms.\6\ Accordingly, the proposed rule change would delete 
this requirement.
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    \5\ Dealers are required to use Form G-40 to appoint a ``Primary 
Contact'' who must be either a Series 53-registered municipal 
securities principal or a Series 51-registered municipal fund 
securities limited principal. The rule also requires each dealer to 
maintain an Internet e-mail account, and to review and, if 
necessary, update its Primary Contact information within 17 business 
days of each calendar year. The rule is based on similar FINRA 
requirements; the Board attempts, whenever possible, to adopt rule 
provisions and language similar to FINRA rules in order to ensure a 
coordinated regulatory approach in areas of mutual regulation.
    \6\ In addition to certain quarterly reports provided to FINRA 
and the bank regulatory agencies, the MSRB provides FINRA examiners 
with secure, on-line access to each dealer's current G-40 
information to assist in inspecting for dealer compliance with Rule 
G-40.
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2. Statutory Basis
    The MSRB believes that the proposed rule change is consistent with 
Section 15B(b)(2)(C) of the Act,\7\ which provides that the MSRB's 
rules shall:
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    \7\ 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 
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the public interest.

The Board believes that by deleting the obsolete requirement to 
maintain copies of Form G-40 and any amended forms, the proposed rule 
change will facilitate dealer understanding and compliance with Rules 
G-8 and G-40, as well as the inspection and enforcement thereof.

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

    The Board does not believe that the proposed rule change will 
result in any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act since it would apply equally to 
all brokers, dealers and municipal securities dealers.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    Written comments were neither solicited nor received.

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

    Because the proposed rule change: (i) Does not significantly affect 
the protection of investors or the public interest; (ii) does not 
impose any significant burden on competition; and (iii) does not become 
operative for 30 days from February 19, 2008, the date on which it was 
filed, and the MSRB provided the Commission with written notice of its 
intent to file the proposed rule change at least five business days 
prior to the filing date, the proposed rule change has become effective 
pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(6) 
thereunder.\9\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate such rule change if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors, or otherwise 
in furtherance of the purposes of the Act.\10\
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    \10\ See Section 19(b)(3)(C) of the Act, 15 U.S.C. 78s(b)(3)(C).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-MSRB-2008-01 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-MSRB-2008-01. 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

[[Page 14294]]

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-2008-01 and should be submitted on or before April 
7, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-5222 Filed 3-14-08; 8:45 am]

BILLING CODE 8011-01-P