MSRB NOTICE 2000-22 (JULY 14, 2000)


The MSRB has filed with the SEC technical amendments to rules G-8 and G-15. The technical amendments become operative on September 19, 2000.

On July 14, 2000, the Municipal Securities Rulemaking Board (the “MSRB” or “Board”) filed with the Securities and Exchange Commission (the “SEC”) technical amendments to rules G-8, on books and records to be made by brokers, dealers and municipal securities dealers, and G-15, on confirmation, clearance and settlement of transactions with customers.[1] The technical amendments become operative on September 19, 2000.

The MSRB has adopted technical amendments to rules G-8 and G-15 for the purpose of making the following non-substantive changes:

  • On March 16, 2000, the Commission approved amendments to rule G-8 as well as to rules G-27, on supervision, and G-9, on preservation of records (the “Supervision Amendments”), relating to supervisory procedures for review of correspondence with the public.[2] The Supervision Amendments also become effective on September 19, 2000. Among other things, they provide for the maintenance of records of written supervisory procedures and of correspondence relating to a municipal securities representative’s municipal securities activities.

Under current rule G-8(f), a non-bank dealer is deemed to be in compliance with its recordkeeping obligations under rule G-8 if it is in compliance with the SEC’s recordkeeping rule (Exchange Act Rule 17a-3), provided that the dealer must still maintain certain types of records identified in rule G-8 that are specifically required under Board rules and are unique to the municipal securities market. The technical amendment to rule G-8(f) set forth in this filing requires a non-bank dealer relying on Exchange Act Rule 17a-3 for the maintenance of its books and records to nonetheless maintain the records of supervisory procedures and correspondence required by the recent amendments.

  • The amendment to rule G-15(d)(ii)(B)(2)(d) makes a paragraph reference consistent with the Board’s general usage of such references throughout the rules.

July 14, 2000

Text of Technical Amendments [3]

Rule G-8. Books and Records to be Made by Brokers, Dealers and Municipal Securities Dealers

(a) - (e) No change.

(f) Compliance with Rule 17a-3. Brokers, dealers and municipal securities dealers other than bank dealers which are in compliance with rule 17a-3 of the Commission will be deemed to be in compliance with the requirements of this rule, provided that the information required by subparagraph (a)(iv)(D) of this rule as it relates to uncompleted transactions involving customers; paragraph (a)(viii); and paragraphs (a)(xi)[; paragraph (a)(xii); paragraph (a)(xiii); paragraph (a)(xiv); paragraph (a)(xv); paragraph (a)(xvi); paragraph (a)(xvii); paragraph (a)(xviii); and paragraph (a)(xix)] through (a)(xx) shall in any event be maintained.

Rule G-15. Confirmation, Clearance and Settlement of Transactions with Customers

(a) - (c) No change.

(d) Delivery/Receipt vs. Payment Transactions.

(i) No change.

(ii) Requirement for Confirmation/Acknowledgment.

(A) No change.

(B) Definitions for Rule G-15(d)(ii).

(1) No change.

(2) "Qualified Vendor" shall mean a vendor of electronic confirmation and acknowledgment services that:

(a) - (c) No change.

(d) notifies the Commission staff immediately in writing of any material change to its confirmation/affirmation systems. (For purposes of this subparagraph (d) [(D)] "material change" means any changes to the vendor’s systems that significantly affect or have the potential to significantly affect its electronic trade confirmation/acknowledgment systems, including: changes that: (i) affect or potentially affect the capacity or security of its electronic trade confirmation/acknowledgment system; (ii) rely on new or substantially different technology; (iii) provide a new service as part of the Qualified Vendor’s electronic trade confirmation/acknowledgment system; or (iv) affect or have the potential to adversely affect the vendor’s confirmation/acknowledgment system’s interface with a Clearing Agency.);

(e)-(g) No change.

(3) No change.

(C) No change.

(iii) No change.

(e) No change.

[1] File No. SR-MSRB-00-9. Comments submitted to the SEC should refer to this file number.

[2] See Exchange Act Rel. No. 42538 (March 16, 2000), 65 FR 15675 (March 23, 2000).

[3] Underlining indicates additions; strikethrough indicates deletions.