Rule G-34. (a)
New Issue Securities.
(i) Assignment of CUSIP Numbers.
(A) Except as otherwise provided in this section (a), each broker, dealer or municipal securities dealer who acquires, whether as principal or agent, a new issue of municipal securities from the issuer of such securities for the purpose of distributing such new issue (“underwriter”) and each broker, dealer or municipal securities dealer acting as a financial advisor in a competitive sale of a new issue (“financial advisor”) shall apply in writing to the Board or its designee for assignment of a CUSIP number or numbers to such new issue, as follows:
(1) The underwriter in a negotiated sale shall make an application by no later than the time that pricing information for the issue is finalized. Such application for CUSIP number assignment shall be made at a time sufficient to ensure final CUSIP number assignment occurs prior to the formal award of the issue.
(2) The underwriter in a competitive sale for which no CUSIP numbers have been pre-assigned shall make an application immediately after receiving notification of the award from the issuer. The underwriter in a competitive sale shall ensure that CUSIP numbers are assigned prior to disseminating the Time of First Execution required under paragraph (a)(ii)(C) of this Rule G-34.
(3) A financial advisor shall make an application by no later than one business day after dissemination of a notice of sale. Such application for CUSIP number assignment shall be made at a time sufficient to ensure final CUSIP numbers assignment occurs prior to the award of the issue.
(4) In making applications for CUSIP number assignment, the following information shall be provided:
(a) complete name of issue and series designation, if any;
(b) interest rate(s) and maturity date(s) (provided, however, that, if the interest rate is not established at the time of application, it may be provided at such time as it becomes available);
(c) dated date;
(d) type of issue (e.g., general obligation, limited tax or revenue);
(e) type of revenue, if the issue is a revenue issue;
(f) details of all redemption provisions;
(g) the name of any company or other person in addition to the issuer obligated, directly or indirectly, with respect to the debt service on all or part of the issue (and, if part of the issue, an indication of which part); and
(h) any distinction(s) in the security or source of payment of the debt service on the issue, and an indication of the part(s) of the issue to which such distinction(s) relate.
(5) Any changes to information identified in this paragraph (a)(i)(A) and included in an application for CUSIP number assignment shall be provided to the Board or its designee as soon as they are known but no later than a time sufficient to ensure final CUSIP number assignment occurs prior to disseminating the Time of First Execution required under paragraph (a)(ii)(C) of this Rule G-34.
(B) The information required by subparagraph (i)(A) of this section (a) shall be provided in accordance with the provisions of this subparagraph. The application shall include a copy of a notice of sale, official statement, legal opinion, or other similar documentation prepared by or on behalf of the issuer, or portions of such documentation, reflecting the information required by subparagraph (i)(A) of this section (a). Such documentation may be submitted in preliminary form if no final documentation is available at the time of application. In such event the final documentation, or the relevant portions of such documentation, reflecting any changes in the information required by subparagraph (i)(A) of this section (a) shall be submitted when such documentation becomes available. If no such documentation, whether in preliminary or final form, is available at the time application for CUSIP number assignment is made, such copy shall be provided promptly after the documentation becomes available.
(C) The provisions of paragraph (i) of this section (a) shall not apply with respect to any new issue of municipal securities on which the issuer or a person acting on behalf of the issuer has submitted an application for assignment of a CUSIP number or numbers.
(D) In the event that the proceeds of the new issue will be used, in whole or in part, to refund an outstanding issue or issues of municipal securities in such a way that part but not all of the outstanding issue or issues previously assigned a single CUSIP number is to be refunded to one or more redemption date(s) and price(s) (or all of an outstanding issue is to be refunded to more than one redemption date and price), the broker, dealer or municipal securities dealer shall apply in writing to the Board or its designee for a reassignment of a CUSIP number to each part of the outstanding issue refunded to a particular redemption date and price and shall provide to the Board or its designee the following information on the issue or issues to be refunded:
(1) the previously assigned CUSIP number of each such part or issue;
(2) for each such CUSIP number, the redemption dates and prices, to be established by the refunding;
(3) for each such redemption date and price, a designation of the portion of such part or issue (e.g., the designation of use of proceeds, series, or certificate numbers) to which such redemption date and price applies.
The underwriter also shall provide documentation supporting the information provided pursuant to the requirements of this subparagraph (D).
(ii) Application for Depository Eligibility, CUSIP Number Affixture and Initial Communications. Each underwriter shall carry out the following functions:
(A) Except as otherwise provided in this subparagraph (ii)(A),
the underwriter shall apply to a securities depository registered
with the Securities and Exchange Commission, in accordance with
the rules and procedures of such depository, to make such new
issue depository-eligible. The application required by this
subparagraph (ii)(A) shall be made as promptly as possible,
but in no event later than one business day after award from
the issuer (in the case of a competitive sale) or one business
day after the execution of the contract to purchase the securities
from the issuer (in the case of a negotiated sale). In the event
that the full documentation and information required to establish
depository eligibility is not available at the time the initial
application is submitted to the depository, the underwriter
shall forward such documentation as soon as it is available;
provided, however, this subparagraph (ii)(A) of this rule shall
not apply to:
(1) an issue of municipal securities that fails to meet the
criteria for depository eligibility at all depositories that
accept municipal securities for deposit; or
(2) any new issue maturing in 60 days or less.
(B) The underwriter, prior to the delivery of such securities
to any other person, shall affix to, or arrange to have affixed
to, the securities certificates of such new issue the CUSIP
number assigned to such new issue. If more than one CUSIP number
is assigned to the new issue, each such number shall be affixed
to the securities certificates of that part of the issue to
which such number relates.
(C) The underwriter of a new issue of municipal securities shall communicate information about the new issue in accordance with the requirements of this paragraph (a)(ii)(C) to ensure that other brokers, dealers and municipal securities dealers have timely access to information necessary to report, compare, confirm, and settle transactions in the new issue and to ensure that registered securities clearing agencies receive information necessary to provide comparison, clearance and depository services for the new issue; provided, however, that this paragraph (a)(ii)(C) shall not apply to short-term instruments under nine months in effective maturity, including variable rate instruments, auction rate products, and commercial paper.
(1) The underwriter shall ensure that the following information is submitted to a new issue information dissemination system in the manner described in the written procedures for system users and that changes to submitted information are made as soon as possible:
(a) the Time of Formal Award. For purposes of this paragraph (a)(ii)(C), the “Time of Formal Award” means, for competitive issues, the later of the time the issuer announces the award or the time the issuer notifies the underwriter of the award, and, for negotiated issues, the later of the time the contract to purchase the securities from the issuer is executed or the time the issuer notifies the underwriter of its execution. If the underwriter and issuer have agreed in advance on a Time of Formal Award, that time may be submitted to the new issue information dissemination system in advance of the actual Time of Formal Award.
(b) the Time of First Execution. For purposes of this paragraph (a)(ii)(C), the “Time of First Execution” means the time the underwriter plans to execute its first transactions in the new issue. The underwriter shall designate a Time of First Execution that is no less than two hours after all information required by paragraph (a)(ii)(C) has been transmitted to the new issue information dissemination system.
(c) All other information identified as required for “Trade Eligibility” in the new issue information dissemination system.
(2) The underwriter shall ensure that all information identified in this paragraph (a)(ii)(C) is provided no later than two hours of the Time of Formal Award. For purposes of this paragraph (a)(ii)(C), the hours counted in determining the responsibilities of an underwriter shall include only the hours of 9:00 A.M. and 5:00 P.M. Eastern Time on an RTRS Business Day as defined in Rule G-14 RTRS Procedures section (d)(ii).
(3) The term “new issue information dissemination system” means an automated, electronic system operated by a securities clearing agency registered with the Securities and Exchange Commission providing depository services for municipal securities that receives comprehensive new issue information on a market-wide basis for the purposes of establishing depository eligibility and immediately re-disseminating such information to information vendors supplying formatted municipal securities information for use in automated trade processing systems.
(D) The underwriter of a new issue of municipal securities of short-term instruments under nine months in effective maturity, including variable rate instruments, auction rate products, and commercial paper, shall as promptly as possible announce each item of information listed below in a manner reasonably designed to reach market participants that may trade the new issue. All information shall be announced no later than the time of the first execution of a transaction in the new issue by the underwriter.
(1) the CUSIP number or numbers assigned to the issue and descriptive information sufficient to identify the CUSIP number corresponding to each part of the issue assigned a specific CUSIP number; and
(2) the Time of Formal Award as defined in subparagraph (a)(ii)(C)(1)(a).
(iii) Underwriting Syndicate. In the event a syndicate
or similar account has been formed for the purchase of a new issue
of municipal securities, the managing underwriter shall take the
actions required of the underwriter under the provisions of this
section (a).
(b) Secondary Market Securities.
(i) Each broker, dealer, or municipal securities dealer that,
in connection with a sale or an offering for sale of part of a
maturity of an issue of municipal securities, acquires or arranges
for the acquisition of a transferable instrument applicable to
such part which alters the security or source of payment of such
part shall apply in writing to the Board or its designee for the
assignment of a CUSIP number to designate the part of the maturity
of the issue which is the subject of the instrument when traded
with the instrument attached. Such instruments shall include (A)
insurance with respect to the payment of debt service on such
portion, (B) a put option or tender option, (C) a letter of credit
or guarantee, or (D) any other similar device. This paragraph
(i) shall not apply with respect to any part of an outstanding
maturity of an issue of municipal securities with respect to which
a CUSIP number that is applicable to such part when traded with
an instrument which alters the security or source of payment of
such part has already been assigned.
(ii) Each broker, dealer or municipal securities dealer, in connection
with a sale or an offering for sale of part of a maturity of an
issue of municipal securities which is assigned a CUSIP number
that no longer designates securities identical with respect to
all features of the issue listed in items (1) through (8) of subparagraph
(a)(i)(A) of this rule, shall apply in writing to the Board or
its designee for a new CUSIP number or numbers to designate the
part or parts of the maturity which are identical with respect
to items (1) through (8) of subparagraph (a)(i)(A).
(iii) The broker, dealer or municipal securities dealer shall
make the application required under this section (b) as promptly
as possible, and shall provide to the Board or its designee:
(A) the previously assigned CUSIP number;
(B) all information on the features of the maturity of the
issue listed in items (1) through (8) of subparagraph (a)(i)(A)
of this rule and documentation of the features of such maturity
sufficient to evidence the basis for CUSIP number assignment;
and,
(C) if the application is based on an instrument affecting
the source of payment or security for a part of a maturity of
an issue, information on the nature of the instrument, including
the name of any party obligated with respect to debt service
under the terms of such instrument and documentation sufficient
to evidence the nature of the instrument.
(c) Exemptions. The provisions of this
rule shall not apply to an issue of municipal securities (or
for the purpose of section (b) any part of an outstanding maturity
of an issue) which (i) does not meet the eligibility criteria
for CUSIP number assignment or (ii) consists entirely of municipal
fund securities.
(d) NIIDS Registration and Testing Requirements.
NIIDS is an automated, electronic system that receives comprehensive new issue
information on a market-wide basis for the purposes of establishing depository
eligibility and immediately re-disseminating such information to information
vendors supplying formatted municipal securities information for use in
automated trade processing systems. It is operated by Depository Trust
and Clearing Corporation (DTCC), a securities clearing agency registered with
the Securities and Exchange Commission providing depository services for
municipal securities.
(i) NIIDS Registration. Prior to acting as
underwriter for a new issue of municipal securities with nine months or greater
effective maturity, each broker, dealer or municipal securities dealer must
register to use NIIDS with DTCC.
(ii) NIIDS Testing.
(A) NIIDS Web Interface.
Prior to acting as underwriter for a new issue of municipal securities
with nine months or greater effective maturity, each broker, dealer or
municipal securities dealer shall test its capability to use NIIDS by
successfully submitting two test new issues using the NIIDS Web Interface.
(B) NIIDS Autofeed Interface.
Prior to acting as underwriter for a new issue of municipal securities with
nine months or greater effective maturity, each broker, dealer or municipal
securities dealer that plans to establish computer-to-computer connections with
NIIDS (either directly or through a vendor) shall test its capability to use
NIIDS by successfully submitting two test new issues using computer-to-computer
connections.
(iii) NIIDS Start-Up. Each broker, dealer or
municipal security dealer that has acted at any time after September 30, 2007
and plans to continue to act as an underwriter for a new issue of municipal
securities with nine months or greater effective maturity shall complete the
requirements of this section (d) by no later than September 15, 2008.
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