MSRB Issues Regulatory Notice Regarding SEC's Approval of First Municipal Advisor Rule and Other Amendments

The MSRB issued a Regulatory Notice regarding the SEC's approval to adopt MSRB Rule G-44, the first rule dedicated to municipal advisors, as well as related amendments to Rule G-8 ("Books and Records to be Made by Brokers, Dealers and Municipal Securities Dealers") and Rule G-9 ("Preservation of Records").

According to the Regulatory Notice, the MSRB is in the process of developing a "comprehensive regulatory framework" for municipal advisors. The adoption of Rule G-44, which establishes supervisory and compliance obligations of municipal advisors is a "significant element" of this framework. Rule G-44 utilizes a "principles-based approach" to supervision and compliance in order to, among other things, "accommodate the diversity of the municipal advisor population, including small and single-person entities."

Rule G-44 is accompanied by amendments to Rules G-8 and G-9, which establish books-and-records requirements for municipal advisors, including those related to their supervisory and compliance obligations.

The rule changes to G-8 and G-9 will become effective on April 23, 2015; Rule G-44(d) will become effective on April 23, 2016.

See: MSRB Regulatory Notice; MSRB Press Release on Rule G-44; SEC Approval Order.