MSRB Proposes One-Time Exception for Municipal Advisor Requalification

The MSRB proposed amendments to Rule G-3 ("Professional Qualification Requirements") to include a one-time exception to allow individuals previously qualified as municipal advisors whose certification lapsed to requalify without having to take the Series 50 exam, subject to certain conditions. The amendments apply to municipal advisor representatives but not to municipal advisor principals (due to the nature of a principal's roles and responsibilities).

The proposal would grant the one-time exception if the individual:

• was previously qualified as a municipal advisor representative by passing the Series 50 exam and held that qualification for at least three consecutive years;

• sought requalification no later than three years after the initial qualification lapsed;

• did not engage in any municipal advisory activity during the period that the qualification had lapsed;

• is not subject to any ongoing enforcement or other adverse regulatory matters relating to municipal advisory activities; and

• provides all relevant continuing education material required under MSRB Rule G-3.

Additionally, after requalification, but prior to engaging in any advisory activities, the individual would be required to (i) familiarize himself with the firm's compliance policies and procedures, and (ii) file a Form MA-I ("Information Regarding Natural Persons who Engage in Municipal Advisory Activities") with the SEC. The proposal would also require municipal advisor firms to notify the MSRB that an individual was requalified as a municipal representative prior to the individual returning to the firm.

The MSRB said that the rule would only provide a onetime exception, and that any representative seeking requalification that has already exhausted the exception will be required to retake the Series 50 exam to requalify. Comments on the proposal are due by January 30, 2023.