Document ID: SEC-2016-1964-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Municipal Securities Rulemaking Board
Posted Date: 2016-11-10T05:00Z

[Federal Register Volume 81, Number 218 (Thursday, November 10, 2016)]
[Notices]
[Pages 79069-79071]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-27149]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-79239; File No. SR-MSRB-2016-14]

Self-Regulatory Organizations; Municipal Securities Rulemaking 
Board; Notice of Filing and Immediate Effectiveness of a Proposed Rule 
Change To Establish Fees Related to the MSRB Academic Historical 
Transaction Data Product

November 4, 2016.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act'' or ``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ 
notice is hereby given that on October 25, 2016 the Municipal 
Securities Rulemaking Board (the ``MSRB'' or ``Board'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I, II, and III below, which Items have 
been prepared by the MSRB. The

[[Page 79070]]

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 filed with the Commission a proposed amendment to the 
MSRB's facility for the Real-Time Transaction Reporting System 
(``RTRS'') to establish fees related to the MSRB Academic Historical 
Transaction Data Product (``RTRS Academic Data Product'') (``proposed 
rule change'').\3\ The MSRB has designated the proposed rule change as 
establishing or changing a fee or charge of the MSRB, which renders the 
proposed rule change effective upon receipt of this filing by the 
Commission. The effective date of the fees will coincide with the 
effective date of the RTRS Academic Data Product, which the MSRB will 
announce in a regulatory notice to be published no later than December 
12, 2016, and which will be no later than June 9, 2017.\4\ The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \3\ See Exchange Act Release No. 78826 (Sept. 13, 2016), 81 FR 
64215 (Sept. 19, 2016) (SR-MSRB-2016-09) (``Approval Order'').
    \4\ See id. at 64216 (noting that the effective date of the RTRS 
Academic Data Product will be announced in a regulatory notice to be 
published no later than 90 days from the date of the Approval Order, 
and such effective date will be no later than 270 days following 
publication of the regulatory notice announcing Commission approval 
of the proposed rule change); MSRB Notice 2016-22 (Sept. 14, 2016).
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    The text of the proposed rule change is available on the MSRB's Web 
site at www.msrb.org/Rules-and-Interpretations/SEC-Filings/2016-Filings.aspx, at the MSRB's principal office, and at the Commission's 
Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the MSRB included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The 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
    Under the Exchange Act, the MSRB is charged with adopting rules 
with respect to transactions in municipal securities effected by 
brokers, dealers and municipal securities dealers (``dealers'') and the 
municipal advisory activities of municipal advisors. In addition, the 
MSRB has undertaken to create various market transparency products in 
furtherance of its statutory duties and its mission, which is, in part, 
to promote a fair and efficient municipal securities market through the 
collection and dissemination of market information.
    Historically, the MSRB has operated information systems to collect 
key disclosure documents and transaction data to create a central 
warehouse of information that in turn made most of these documents and 
data available to the market--the Electronic Municipal Market Access 
(EMMA[supreg]) \5\ Web site. The MSRB makes post-trade transaction data 
available to the general public through the EMMA Web site at no cost, 
and to data vendors, industry utilities and others on a subscription 
basis through a real-time data feed and on a delayed basis.
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    \5\ EMMA[supreg] is a registered trademark of the MSRB.
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    MSRB Rule G-14, on transaction reporting, requires dealers to 
report all executed transactions in municipal securities to RTRS within 
15 minutes of the time of trade, with limited exceptions.\6\ The 
information facility for RTRS serves to outline the high-level 
parameters by which the MSRB operates the system. The new RTRS Academic 
Data Product will include the same transactions included in the current 
RTRS historical transaction data sets, with the inclusion of anonymized 
dealer identifiers but the exclusion of list offering price and 
takedown transactions, which are defined such that they generally 
encompass primary market transactions; will be made available only to 
academic institutions; and will be highly useful in connection with 
research activities by allowing academic institutions to attribute 
transactions to the dealers that facilitated them.
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    \6\ Transactions in securities without CUSIP numbers, 
transactions in municipal fund securities and certain inter-dealer 
securities movements not eligible for comparison through a clearing 
agency are the only transactions exempt from the reporting 
requirements of Rule G-14.
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    The purpose of the proposed rule change is to establish fees 
related to the RTRS Academic Data Product. Specifically, the proposed 
rule change would make the RTRS Academic Data Product available to 
academic institutions for a fee of $500 per one-year data set (with a 
one-time initial set-up fee of $500).\7\ The MSRB customarily waives 
all fees associated with an MSRB subscription service or historical 
data product purchase for non-profit organizations (including academic 
institutions). However, due to the additional legal and operational 
effort required for the MSRB to offer the RTRS Academic Data Product, 
the MSRB believes that the $500 fee per one-year data set and $500 one-
time initial set-up fee is appropriate to help defray these costs, 
while not overly burdening academic institutions.
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    \7\ Academic institutions would be able to request the one-year 
data sets on a rolling basis, and any request that is not in a 12-
month increment would be charged the full fee for an additional 
year.
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2. Statutory Basis
    Section 15B(b)(3)(B)(ii) of the Exchange Act \8\ provides that the 
MSRB:
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    \8\ 15 U.S.C. 78o-4(b)(3)(B)(ii).

    shall not be prohibited from charging commercially reasonable 
fees for automated subscription-based feeds or similar services, or 
for charging for other data or document-based services customized 
upon request of any person, made available to commercial 
enterprises, municipal securities market professionals, or the 
general public, whether delivered through the Internet or any other 
means, that contain all or part of the documents or information, 
subject to approval of the fees by the Commission under section 
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19(b).

    The MSRB believes that the proposed rule change is consistent with 
Section 15B(b)(3)(B)(ii) of the Exchange Act \9\ in that it would 
charge a fee of $500 per one-year data set (with a one-time initial 
set-up fee of $500) for the RTRS Academic Data Product. The MSRB 
believes these fees are commercially reasonably as a means to help 
defray the additional legal and operational effort required for the 
MSRB to offer the RTRS Academic Data Product, while not overly 
burdening academic institutions.
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    \9\ Id.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    Section 15B(b)(2)(C) of the Exchange Act \10\ requires that MSRB 
rules not be designed to impose any burden on competition not necessary 
or appropriate in furtherance of the purposes of the Act. In 
determining whether these standards have been met, the MSRB was guided 
by the Board's Policy on the Use of Economic Analysis

[[Page 79071]]

in MSRB Rulemaking. In accordance with this policy, the Board has 
evaluated the potential impacts on competition of the proposed rule 
change, including in comparison to reasonable alternative regulatory 
approaches, relative to the baseline. The MSRB also considered other 
economic impacts of the proposed rule change and has addressed comments 
relevant to these impacts in other sections of this document. The MSRB 
does not believe that the proposed rule change will impose any 
additional burdens on competition, relative to the baseline, that are 
not necessary or appropriate in furtherance of the purposes of the Act. 
The MSRB notes that the proposed rule change will apply equally to all 
academic institutions who choose to purchase the RTRS Academic Data 
Product.
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    \10\ 15 U.S.C. 78o-4(b)(2)(C).
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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 received 13 comment letters in response to the request for 
comment that originally proposed the RTRS Academic Data Product.\11\ As 
was proposed in the Request for Comment, the RTRS Academic Data Product 
would have been made available for a fee of $500 per calendar-year data 
set (with a one-time initial set-up fee of $500).\12\ Only two of the 
commenters addressed the proposed fees.\13\ Specifically, Harris 
commented that academics should either pay a reduced rate, when 
compared to the fee charged to industry participants and their various 
organizations and consultants, or be given access for free because, in 
his opinion, academics are often not paid to conduct their research 
while the public obtains a benefit from the research being conducted. 
ABFM stated that it believes the fee is reasonable. The MSRB notes that 
there is no occasion to provide the RTRS Academic Data Product at a 
discount, as it is available only to academic institutions. Further, 
the MSRB believes that the proposed fees, which are substantially less 
than the analogous fees for the historical transaction data sets,\14\ 
are fair and reasonable given the expenses incurred to create and 
facilitate the product, and that the fees would not overly burden 
academic institutions.
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    \11\ See MSRB Notice 2015-10 (July 16, 2015) (``Request for 
Comment'').
    \12\ The MSRB notes that the Request for Comment proposed the 
availability of the RTRS Academic Data Product in calendar-year data 
sets, but, as it does with other data products and as described 
above, the MSRB would make the RTRS Academic Data Product available 
on a rolling basis in one-year data sets.
    \13\ See letters from: Robert Kravchuk, et al., Association for 
Budgeting and Financial Management (``ABFM''), dated September 13, 
2015; and Lawrence Harris (``Harris''), Professor of Finance and 
Business Economics, University of Southern California, Marshall 
School of Business, dated September 6, 2015.
    \14\ The MSRB provides historical transaction data in one-year 
data sets for $2,500 per year and charges a one-time set-up fee of 
$2,000.
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III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing proposed rule change has become effective pursuant to 
Section 19(b)(3)(A) of the Act \15\ and paragraph (f) of Rule 19b-4 
thereunder.\16\ At any time within 60 days of the filing of the 
proposed rule change, the Commission summarily may temporarily suspend 
such rule change if it appears to the Commission that such action is 
necessary or appropriate in the public interest, for the protection of 
investors, or otherwise in furtherance of the purposes of the Act.
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    \15\ 15 U.S.C. 78s(b)(3)(A).
    \16\ 17 CFR 240.19b-4(f).
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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 email to rule-comments@sec.gov. Please include 
File Number SR-MSRB-2016-14 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-MSRB-2016-14. This file 
number should be included on the subject line if email 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 Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549 on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the 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-2016-14 and should be 
submitted on or before December 1, 2016.

    For the Commission, pursuant to delegated authority.\17\
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    \17\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2016-27149 Filed 11-9-16; 8:45 am]
 BILLING CODE 8011-01-P