Sales of Interests under ABLE Accounts "May Be" Subject to MSRB Rules (MSRB Reg. Notice 2016-14)

The MSRB reminded firms that an interest in an account established under the Achieving a Better Life Experience Act of 2014 (the "ABLE Act") "may be" a municipal fund security, as defined by MSRB Rule D-12. If so, then a municipal securities dealer who carries out transactions in ABLE programs is subject to MSRB rules.

The MSRB specified that dealers acting as underwriters of sales of interests in ABLE programs might be subject to the following requirements:

• "MSRB Rule G-32, on disclosures in connection with primary offerings, and the requirement to submit official statements through the MSRB's Electronic Municipal Market Access" ("EMMA") system pursuant to Rule G-32(b); and

• "MSRB Rule G-45, on reporting of information concerning municipal fund securities, and the requirement to submit information on Form G-45."

In addition, the MSRB noted the SEC determination that interest in 529 college savings plans are municipal securities. In response, the MSRB asserted that the interpretive guidance for MSRB rules relating to the sale of interests in 529 college savings plans also is applicable to the sale of interests in ABLE programs.

The MSRB stressed that it anticipates publishing guidance on more specific issues that are applicable to the sale of interests in ABLE programs by dealers, including interpretative guidance on Rule G-45.

The MSRB interpretive guidance is effective immediately.