MSRB NOTICE 2003-03 (FEBRUARY 3, 2003)


The Municipal Securities Rulemaking Board (the “MSRB”) has a long-standing policy to increase price transparency in the municipal securities market.  The ultimate goal of the MSRB’s transaction reporting program is to collect and make available transaction information in a comprehensive and contemporaneous manner. Toward that end, the MSRB has begun development of the Real-time Transaction Reporting System or RTRS.  The MSRB and the Fixed Income Clearing Corporation (FICC)[1] are coordinating development of real-time systems to minimize costs to the industry.  The MSRB plans to begin testing RTRS with dealers late in 2003 and to make RTRS operational in mid-2004.

Key Features

            The MSRB has published a draft operational plan describing RTRS.[2]  The important features of the operational plan are:

  • Rule G-14 on transaction reporting will be revised to require dealers, when RTRS becomes operational, to report all trades in municipal securities within 15 minutes.
  • A “single pipeline” will be available whereby dealers may use their existing telecommunications link to the FICC to submit trades to FICC’s Real-Time Transaction Matching (RTTM) system for automated comparison[3] as well as to report trades to the MSRB’s RTRS for regulatory purposes.
  • An RTTM web user interface will allow dealers to enter, view and modify trades submitted for comparison or for transaction reporting.

Single Record for Comparison and Reporting

            The MSRB currently plans to require that, for each inter-dealer trade, a dealer will use a single real-time message to submit the trade to the comparison system and to report it to RTRS.  This approach will help ensure consistency of records among dealers that effect inter-dealer trades, their clearing brokers, the RTTM system, and RTRS.  It also increases the likelihood that trade input will be accurate.  Since trades will be submitted to the RTTM comparison system by clearing brokers, either on their own behalf or on behalf of their correspondent dealers, clearing brokers will report inter-dealer trades by their correspondents to the MSRB with the same message they use to submit the trade for comparison.[4]

            The format of the single message will incorporate both trade comparison and regulatory reporting data elements.  The regulatory reporting elements are those required by the MSRB for reporting purposes but not needed for comparison –  for example, the time of trade execution.  In the real-time environment, the MSRB plans that it will be possible for correspondent dealers to view all data about their trades submitted by their clearing broker for comparison to RTTM and reported for regulatory purposes to RTRS.  Correspondent dealers will be able, if necessary, to make corrections to the regulatory data without a need for the clearing broker to submit corrected regulatory data on their behalf. 

            Customer transactions will continue to be reported in real-time as they are currently, that is, either by the dealer that effects the trade or by another party, such as a service bureau or clearing broker, that reports on behalf of the effecting dealer.

            An “Operational Overview” document will be published by the MSRB in March 2003.  This will provide further guidance to dealers to assist in revising or developing their operational systems to accord with the 15-minute reporting requirement and will specify other business and technical rules for real-time reporting.  The MSRB and FICC also plan to brief dealers about plans for real-time reporting in several cities in the spring of 2003.

February 3, 2003

[1]           FICC formerly was the Government Securities Clearing Corporation (GSCC), a subsidiary of Depository Trust Clearing Corporation (DTCC). 

[2]           See “Real-Time Reporting of Municipal Securities Transactions,” MSRB notice dated May 29, 2001, on

[3]           RTTM will replace the current NSCC Fixed Income Transaction System (FITS), which performs automated comparison of trades in batch mode.  RTTM will compare inter-dealer trades in real time and will forward inter-dealer trade data to the MSRB for real-time transaction reporting.  See DTCC, “Real-time Trade Matching (RTTM) for NSCC-Eligible Fixed Income Securities: Business Requirements,” (July 2002), on

[4]            Correspondents and clearing brokers will continue to share responsibility for accurate and timely reporting, as they do now.