MSRB Requests Comment on Proposal to Consolidate Time-of-Trade Disclosure Requirements for Dealers

Date: February 11, 2013

Contact: Jennifer A. Galloway, Chief Communications Officer
             (703) 797-6600


Alexandria, VA – The Municipal Securities Rulemaking Board (MSRB) is seeking comment on a proposal to consolidate into a new rule existing requirements for dealers to disclose material information to customers in connection with the purchase or sale of a municipal security.

These disclosure obligations are currently set forth in numerous interpretations to the MSRB’s rule on fair dealing. Under this guidance, dealers must disclose to their customers, at or prior to the time of trade, all material information about the transaction known by the dealer, as well as material information about the security that is reasonably accessible to the market.

“Disclosure of material information to investors is a cornerstone of the MSRB’s regulatory framework,” said MSRB Executive Director Lynnette Kelly. “Adding greater visibility to this requirement in the form of a stand-alone rule will highlight the importance of disclosure in the municipal market.” Kelly said the changes also will help dealers better understand and comply with their disclosure obligation.

Comments on the proposed consolidation of time of trade disclosure guidance, as well as the proposed new rule format, should be submitted no later than March 12, 2013.

The MSRB protects investors, state and local governments and other municipal entities, and the public interest by promoting a fair and efficient municipal securities market. The MSRB fulfills this mission by regulating the municipal securities firms, banks and municipal advisors that engage in municipal securities and advisory activities. To further protect market participants, the MSRB provides market transparency through its Electronic Municipal Market Access (EMMA®) website, the official repository for information on all municipal bonds. The MSRB also serves as an objective resource on the municipal market, conducts extensive education and outreach to market stakeholders, and provides market leadership on key issues. The MSRB is a self-regulatory organization governed by a 21-member board of directors that has a majority of public members, in addition to representatives of regulated entities. The MSRB is overseen by the Securities and Exchange Commission and Congress.