[Federal Register Volume 59, Number 168 (Wednesday, August 31, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-21473]


[[Page Unknown]]

[Federal Register: August 31, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-34603; File No. SR-MSRB-94-15]

 

Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Municipal Securities 
Rulemaking Board Relating to Interpretation of Rule G-37 on Political 
Contributions and Prohibitions on Municipal Securities Business

August 35, 1994.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''), 15 U.S.C. 78s(b)(1), and Rule 19b-4 thereunder, notice is 
hereby given that on August 18, 1994, the Municipal Securities 
Rulemaking Board (``Board'' or ``MSRB'') filed with the Securities and 
Exchange Commission (``Commission'' or ``SEC'') a proposed rule change 
as described in Items I, II, and III below, which Items have been 
prepared by the Board. The purpose of the proposed rule change is to 
provide interpretative guidance concerning rule G-37 on political 
contributions and prohibitions on municipal securities business. The 
Board has designated this proposal as constituting a stated policy, 
practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule of the Board under 
Section 19(b)(3)(A) of the Act, which renders the proposal effective 
upon receipt of this filing by the Commission. 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 filing the proposed rule change to provide 
interpretative guidance concerning rule G-37 on political contributions 
and prohibitions on municipal securities business.\1\
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    \1\The Board plans to publish the interpretations in the August 
1994 MSRB Reports (Vol. 14, no. 4, pp 27-32). The interpretations 
also are available for inspection and copying at the Commission's 
public reference room and at the Board.
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II. Self-Regulatory Organization's Statement of the Purpose of and 
Statutory Basis for, 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 
text of these statements may be examined at the places specified in 
Item IV below. The Board has prepared summaries, set forth in Sections 
(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

    On April 7, 1994, the Commission approved Board rule G-37. 
concerning political contributions and prohibitions on municipal 
securities business.\2\ In response to numerous inquiries received by 
the Board concerning the application of the rule, on May 24, 1994, the 
Board filed with the Commission a Question and Answer (``Q&A'') 
interpretation of the rule.\3\ Since that time, the Board has continued 
to receive questions concerning the rule. Thus, in an effort to further 
assist dealers in understanding and complying with rule G-37, the Board 
is filing this second Q&A relating to rule G-37. As previously stated, 
the Board will continue to monitor the application of rule G-37, and, 
from to time, will publish additional notices of interpretations, as 
necessary.
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    \2\Securities Exchange Act Release No. 33868 (April 7, 1994), 59 
FR 17621 (April 13, 1994). The rule applies to contributions made on 
and after April 25, 1994.
    \3\See Securities Exchange Act Release No. 34161 (June 6, 1994), 
59 FR 30379 (June 13, 1994). The interpretations were published in 
the June 1994, MSRB Reports.
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    The Board believes that the proposed rule change is consistent with 
Section 15B(b)(2)(C) of the Act, which provides that the Board's rules 
shall be designed to prevent fraudulent and manipulative acts and 
practices, to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in regulating, 
clearing, settling, processing information with respect to, and 
facilitating transactions in municipal securities, to remove 
impediments to and perfect the mechanism of a free and open market in 
municipal securities, and, in general, to protect investors and the 
public interest.

B. Self-Regulatory Organization's Statement on Burden on Competition

    Because the proposed rule change would apply equally to all 
brokers, dealers and municipal securities dealers, 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

    The foregoing rule change has become effective upon filing pursuant 
to Section 19(b)(3)(A)(i) of the Act and subparagraph (e) of Rule 19b-4 
thereunder because the rule change constitutes a stated policy, 
practice, or interpretation with respect to the meaning, 
administration, or enforcement of an existing rule of the Board.
    At any time within 60 days of the filing of a rule change pursuant 
to Section 19(b)(3)(A) of the Act, the Commission may summarily 
abrogate the 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 purposes 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 submission, 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 principal office of the 
Board. All submissions should refer to File No. SR-MSRB-94-15 and 
should be submitted by September 21, 1994.

    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. 94-21473 Filed 8-30-94; 8:45 am]
BILLING CODE 8010-01-M