[Federal Register: September 26, 2007 (Volume 72, Number 186)]
[Notices]
[Page 54702-54704]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26se07-122]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-56478; File No. SR-MSRB-2007-03]
Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change To Delay the Implementation of Amendments to Rule G-27 on
Supervision
September 20, 2007.
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 September 14, 2007, the Municipal Securities Rulemaking Board
(``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 MSRB has filed the proposal pursuant to section 19(b)(3)(A) of the
Act,\3\ and Rule 19b-4(f)(1) 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).
\4\ 17 CFR 240.19b-4(f)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The MSRB is proposing to delay, until February 29, 2008,
implementation of the amendments to Rule G-27, on supervision, approved
in File Number SR-MSRB-2006-10, and which are scheduled to be
implemented on November 26, 2007. There are no new changes to the text
of Rule G-27 as amended. 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
[[Page 54703]]
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
On May 22, 2007, the Commission approved File Number SR-MSRB-2006-
10, which incorporated into Rule G-27 most of the requirements of NASD
Rules 3010 (Supervision) and 3012 (Supervisory Control System), to help
ensure a coordinated regulatory approach in the area of supervision and
to facilitate inspection and enforcement. The Commission also granted
the MSRB's request for a delayed effective date of November 26, 2007.
Shortly after approval of the amendments, MSRB staff began
receiving inquiries from industry members indicating some confusion
over which type of principal is required based on the activities
conducted at branch offices and offices of supervisory jurisdiction.
The MSRB is currently reviewing the amendments to Rule G-27 in light of
these inquiries and anticipates publishing a notice in the near future
addressing the questions and concerns raised. Pending the completion of
such review and anticipated publication of further guidance in this
area, the MSRB has filed the proposed rule change for immediate
effectiveness to immediately delay, until February 29, 2008, the
implementation date of the recently approved amendments to Rule G-27,
which otherwise would be implemented on November 26, 2007.
2. Statutory Basis
The MSRB believes that the proposed rule change is consistent with
section 15B(b)(2)(C) of the Act,\5\ which provides that the MSRB's
rules shall:
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\5\ 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 MSRB believes that delaying the implementation date of the
recently approved amendments to Rule G-27 will give brokers, dealers
and municipal securities dealers the time needed to determine which, if
any, of their personnel must be registered as a principal (either a
municipal securities principal (Series 53) or a municipal fund
securities limited principal (Series 51)) based on the activities
undertaken at a branch office and/or office of supervisory
jurisdiction.
B. Self-Regulatory Organization's Statement on Burden on Competition
The MSRB does not believe that the proposed rule change will impose
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
The MSRB has received two letters requesting guidance on Rule G-27,
as amended, from the College Savings Foundation and from Sutherland
Asbill & Brennan, LLP. These commentators raised certain substantive
questions regarding the application of the amendments. The MSRB is
currently reviewing the amendments to Rule G-27 in light of these
inquiries and anticipates publishing a notice in the near future
addressing the questions and concerns raised.\6\ The commentators also
requested that the MSRB delay the effective date of the amendments. The
MSRB believes that it would be appropriate to delay the implementation
of the amendments until February 29, 2008, in light of its pending
review of questions on the amendments, anticipated publication of
further guidance in this area, and desire to prevent firms from
expending unnecessary time and expense in registering as principals
certain people who may not need to be so registered.
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\6\ The MSRB believes that a notice should fully address such
questions and concerns. If, however, the MSRB concludes that a
notice is insufficient and that further rulemaking is necessary, the
MSRB will file a separate rule change with the Commission.
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III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The MSRB has designated this proposed rule change as constituting a
stated policy, practice or interpretation with respect to the meaning,
administration or enforcement of an existing MSRB rule under Section
19(b)(3)(A)(i) of the Act,\7\ and Rule 19b-4(f)(1) thereunder,\8\ which
renders the proposed rule change effective upon filing with the
Commission.
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\7\ 15 U.S.C. 78s(b)(3)(A)(i).
\8\ 17 CFR 240.19b-4(f)(1).
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At any time within 60 days of this filing, the Commission may
summarily abrogate this proposal 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.\9\
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\9\ See 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-2007-03 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-2007-03. 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
[[Page 54704]]
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-MSRB-2007-03 and should be submitted on or before
October 17, 2007.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-18957 Filed 9-25-07; 8:45 am]
BILLING CODE 8010-01-P