SIFMA Submits Additional Comments Regarding Proposed Changes to MSRB Rule G-42

SIFMA provided comments to the SEC regarding proposed changes to MSRB Rule G-42 on the duties and standards of conduct of municipal advisors when engaging in advisory activities other than solicitations.

SIFMA stated that it believes the MSRB to have "made important strides" in effecting the workability of the proposed rule "without compromising protections to municipal entities, obligated persons, or investors," but still has significant concerns regarding certain aspects of the proposal that "render it unreasonably burdensome and anti-competitive." SIFMA also asserted that the proposed rule, as currently drafted, is inconsistent with the standards for MSRB rulemaking under Exchange Act Section 15B.

SIFMA voiced particular concerns about, and suggested modifications to, the following aspects of Rule G-42: (i) the proposed principal transaction ban in G-42(e)(ii), (ii) the proposed safe harbor for inadvertent advice in Supplementary Material .06, (iii) the duty of care in the proposed rule and Supplementary Material .01, (iv) clarifications to the duties of a municipal advisor to a municipal entity, and (v) the proposed disclosure and documentation standards in G-42(b) and (c).

See: SIFMA Comment Letter. Related news:MSRB Proposes Conduct Rule for Duties of Non-Solicitor Municipal Advisors (April 15, 2015).