Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by the Municipal Securities Rulemaking Board Relating to Preservation of Records

[Federal Register Volume 61, Number 119 (Wednesday, June 19, 1996)]
[Notices]
[Pages 31207-31208]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-15508]



-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-37304; File No. SR-MSRB-96-5]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of a Proposed Rule Change by the Municipal Securities 
Rulemaking Board Relating to Preservation of Records

June 11, 1996.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''), 15 U.S.C. 78s(b)(1), notice is hereby given that on June 4, 
1996, the Municipal Securities Rulemaking Board (``Board'' or ``MSRB'') 
filed with the Securities and Exchange Commission (``Commission'' or 
``SEC'') a proposed rule change (SR-MSRB-96-5). The proposed rule 
change is described in Items I and II below, which Items have been 
prepared by the Board. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Board is proposing to amend rule G-9, on preservation of 
records. The proposed rule change would require that brokers, dealers 
and municipal securities dealers (collectively, ``dealers'') retain the 
records required by rule G-8(a)(xv) for a period of three years. The 
Board requests that the Commission set the effective date for the 
proposed rule for 30 days after filing.

II. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    In its filing with the Commission, the Board included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
texts of these statements may be examined at the places specified in 
Item IV below. The Board has prepared summaries, set forth in Section 
(A), (B), and (C) below, of the most significant aspects of such 
statements.

(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    Among other things, Board rule G-36 requires that, with certain 
exceptions, each dealer acting as an underwriter in a primary offering 
of municipal securities submit a copy of the final official statement, 
if one is prepared, to the Board. Underwriters also are required to 
send advance refunding documents to the Board if an offering of 
municipal securities ``advance refunds'' an outstanding issue of 
municipal securities.
    Rule G-8(a)(xv) requires that dealers maintain a record of sending 
to the Board, Forms G-36(O/S) and G-36(ARD) and the corresponding 
required documentation. Rule G-9, on preservation of records, currently 
does not state a time period for preservation of these records.
    The proposed amendment to rule G-9 would require that dealers 
retain the records required by rule G-8(a)(xv) for a period of three 
years. This three-year period would coincide with the record retention 
requirement for the documentation supporting proof of delivery of 
official statements to purchasers of new issues securities as required 
by rule G-32 on disclosures in connection with new issues.
    The Board believes the proposed rule change is consistent with 
Section 15B(b)(2)(G) of the Act, which requires, in pertinent part, 
that the Board's rules:

prescribe records to be made and kept by municipal securities 
brokers and municipal securities dealers and the periods for which 
such records shall be preserved.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    The Board does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change: (i) does not 
significantly affect the protection of investors or the public 
interest; (ii) does not impose any significant burden on competition; 
(iii) was provided to the Commission for its review at least five days 
prior to the filing date; and (iv) does not become operative for thirty 
(30) days from the date of its filing, the Board has submitted this 
proposed rule change to become effective pursuant to Section 
19(b)(3)(A) of the Act and Rule 19b-4(e)(6) thereunder. In particular, 
the Board believes that the proposed rule change qualifies as a ``non-
controversial filing'' in that the proposed amendment does not 
significantly affect the protection of investors or the public interest 
and does not impose any significant burden on competition. At any time 
within sixty days of the filing of the proposed rule change, the 
Commission may summarily abrogate such rule change if it appears to the 
Commission that such action is necessary or appropriate in the public 
interest, for the protection of investors, or otherwise in furtherance 
of the purpose of the Act.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549. 
Copies of the submissions, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for inspection and copying in the 
Commission's Public Reference Room. Copies of the filing will also be 
available for inspection and copying at the Board's principal offices. 
All submissions should refer to File No.

[[Page 31208]]

SR-MSRB-96-5 and should be submitted by July 10, 1996.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority, 17 CFR 200.30-3(a)(12).
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-15508 Filed 6-18-96; 8:45 am]
BILLING CODE 8010-01-M