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

MSRB PROVIDES IMPLEMENTATION GUIDANCE ON BEST-EXECUTION RULE

Alexandria, VA – The Municipal Securities Rulemaking Board (MSRB) today published implementation guidance to assist municipal securities dealers in complying with the MSRB’s new rule on “best execution” for municipal securities transactions, taking effect March 21, 2016.

MSRB Rule G-18, approved by the Securities and Exchange Commission (SEC) in December 2014, requires dealers to seek the most favorable terms reasonably available for their retail customers’ transactions. The adoption of this key investor protection provision supports existing MSRB fair-pricing rules, promotes fair competition among dealers, and aligns with recommendations in the SEC’s 2012 Report on the Municipal Securities Market. 

“The MSRB is issuing this guidance to facilitate dealers’ compliance with their new obligations and ensure that retail investors consistently receive the benefit of fair handling of their orders to buy or sell municipal securities,” said MSRB Executive Director Lynnette Kelly.

The MSRB’s guidance addresses how best-execution concepts, including the standard of “reasonable diligence,” applies to municipal securities transactions. The guidance also addresses the exemption from the new obligation for transactions with sophisticated municipal market professionals (SMMPs). Read the implementation guidance.

As part of its effort to promote regulatory efficiency and consistency across the fixed income markets, the MSRB coordinated with the Financial Industry Regulatory Authority (FINRA) on the finalization of the implementation guidance.  

The Municipal Securities Rulemaking Board (MSRB) protects and strengthens the municipal bond market, enabling access to capital, economic growth, and societal progress in tens of thousands of communities across the country. The MSRB fulfills this mission by creating trust in our market through informed regulation of dealers and municipal advisors that protects investors, issuers and the public interest; building technology systems that power our market and provide transparency for issuers, institutions, and the investing public; and serving as the steward of market data that empowers better decisions and fuels innovation for the future. The MSRB is a self-regulatory organization governed by a 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.

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