[Federal Register Volume 86, Number 37 (Friday, February 26, 2021)]
[Notices]
[Pages 11817-11819]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-03948]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-91175; File No. SR-MSRB-2021-01]


Self-Regulatory Organizations; Municipal Securities Rulemaking 
Board; Notice of Filing and Immediate Effectiveness of a Proposed Rule 
Change To Extend the Compliance Date of Amended Form G-32

February 22, 2021.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'' or ``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ notice 
is hereby given that on February 17, 2021 the Municipal Securities 
Rulemaking Board (``MSRB'') filed with the Securities and Exchange 
Commission (``SEC'' or ``Commission'') the proposed rule change as 
described in Items I, II, and III below, which Items have been prepared 
by the MSRB. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The MSRB filed with the Commission a proposed rule change to extend 
the March 31, 2021 compliance date of previously approved amendments to 
Form G-32 until August 2, 2021 in order to provide brokers, dealers, 
and municipal securities dealers (collectively, ``dealers'') additional 
time to operationalize compliance with the amended form (the ``proposed 
rule change''). The MSRB has designated the proposed rule change as 
constituting a ``noncontroversial'' rule change under paragraph (f)(6) 
of Rule 19b-4 under the Act,\3\ which renders the proposal effective 
upon receipt of this filing by the Commission.
---------------------------------------------------------------------------

    \3\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    The text of the proposed rule change is available on the MSRB's 
website at www.msrb.org/Rules-and-Interpretations/SEC-Filings/2021-Filings.aspx, at the MSRB's principal office, and at the Commission's 
Public Reference Room.

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 MSRB included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed

[[Page 11818]]

rule change. The text of these statements may be examined at the places 
specified in Item IV below. The MSRB 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

1. Purpose
    The Commission approved amendments to MSRB Rule G-32, on 
disclosures in connection with primary offerings, in June 2019 (``Rule 
G-32 amendments'').\4\ The Rule G-32 amendments included amendments to 
Form G-32 applicable to dealers acting as underwriters in the primary 
offering of municipal securities to collect and report new data 
elements through the MSRB's Electronic Municipal Market Access Dataport 
system (EMMA[supreg] Dataport) (``amended Form G-32'').\5\ Amended Form 
G-32 is designed to ensure the MSRB receives information from 
underwriters to facilitate the MSRB's collection of market information 
to promote greater regulatory transparency in the municipal securities 
market. Underwriters are already required to input the majority of the 
amended Form G-32 data elements, as applicable, into the Depository 
Trust Company's New Issue Information Dissemination Service 
(``NIIDS'').\6\ Along with the data elements auto-populated from NIIDS, 
nine of the new data elements were identified as requiring manual 
completion, when applicable. Pursuant to the Commission's approval of 
amended Form G-32, the MSRB established a November 30, 2020 compliance 
date for amended Form G-32.\7\
---------------------------------------------------------------------------

    \4\ See Release No. 34-86219 (June 27, 2019), 84 FR 31961 (July 
3, 2019) (File No. SR-MSRB-2019-07).
    \5\ Id.
    \6\ Id. Completing Form G-32 is a requirement under Rule G-32. 
An underwriter must ensure that the data submitted on Form G-32 is 
accurate. Even if the underwriter initially enters the data into 
NIIDS and that data is, thereafter, auto-populated into the Form G-
32, the underwriter is responsible for ensuring the submission of 
accurate information on Form G-32. See Release No. 34-85551 (April 
2, 2019), 84 FR 14988 (April 8, 2019) (File No. SR-MSRB-2019-07) at 
notes 13-14.
    \7\ See MSRB Notice 2019-21 (December 20, 2019), announcing the 
November 30, 2020 effective date for amendments to Form G-32 that 
the Commission approved on June 27, 2019.
---------------------------------------------------------------------------

    In March 2020, the United States declared a national emergency in 
response to the coronavirus disease (``COVID-19'') pandemic.\8\ Shortly 
thereafter in April 2020, the Commission approved an MSRB proposed rule 
change filed for immediate effectiveness to provide regulatory relief 
to dealers and municipal advisors (collectively ``regulated entities'') 
in light of COVID-19 pandemic-related operational challenges and 
disruptions to normal business functions faced by these regulated 
entities.\9\ In the April 2020 filing, the MSRB, among other things, 
provided relief to dealers by extending the compliance date for the 
amended Form G-32 to March 31, 2021. The MSRB also stated in the April 
2020 filing that it would continue to monitor the impact of COVID-
19.\10\
---------------------------------------------------------------------------

    \8\ See ``Proclamation 9994--Declaring a National Emergency 
Concerning the Novel Coronavirus Disease (COVID-19) Outbreak,'' 
(March 13, 2020) at https://www.govinfo.gov/content/pkg/DCPD-202000156/pdf/DCPD-202000156.pdf, 85 FR 15337 (March 18, 2020).
    \9\ See Release No. 34-88694 (April 20, 2020), 85 FR 23088 
(April 24, 2020) (File No. SR-MSRB-2020-01).
    \10\ Id.
---------------------------------------------------------------------------

    In October 2020, the MSRB filed a proposed rule change to clarify 
how dealers acting as underwriters in the primary offering of municipal 
securities must manually complete three of the data fields on amended 
Form G-32 that previously had been described as auto-populated with 
NIIDS data (``new Form G-32 clarifying amendment'').\11\ The Commission 
approved the new Form G-32 clarifying amendment, with a compliance date 
of March 31, 2021, on December 9, 2020.\12\ As a result of the new Form 
G-32 clarifying amendment, underwriters are on notice that there are 
12, rather than nine, data fields that, when applicable, underwriters 
must manually complete with accurate information.
---------------------------------------------------------------------------

    \11\ See Release No. 34-90248 (October 22, 2020) 85 FR 68395 
(October 28, 2020) (File No. SR-MSRB-2020-08). The three additional 
manually submitted data elements were originally included with the 
57 NIIDS auto-populated data elements identified by the MSRB for 
collection in the 2019 rule filing. Accordingly, presently there are 
66 new data elements included on amended Form G-32, including 54 
data elements submitted to NIIDS and auto-populated to amended Form 
G-32, and 12 additional data elements that must be submitted 
manually to EMMA Dataport, as applicable. Id.
    \12\ See Release No. 34-90611 (December 9, 2020), 85 FR 81248 
(December 15, 2020) (File No. SR-MSRB-2020-08).
---------------------------------------------------------------------------

    The MSRB recognizes that the impacts of the COVID-19 pandemic 
persist, including ongoing safety concerns and continuing operational 
challenges for dealers.\13\ Specifically, the MSRB understands that the 
pandemic continues to affect dealers' ability to wholly operationalize 
the changes necessary to implement the new Form G-32 amendments by the 
March 31, 2021 compliance date. For example, dealers need additional 
time to develop and test applicable compliance processes and procedures 
prior to the compliance date and to conduct staff training necessary to 
effectively implement the new Form G-32 amendments.\14\
---------------------------------------------------------------------------

    \13\ In December 2020, the SEC approved an additional MSRB 
proposed rule change for immediate effectiveness that provided 
further COVID-19 pandemic-related regulatory relief to regulated 
entities from certain other MSRB rule requirements outside of Rule 
G-32. See Release No. 34-90621 (December 9, 2020), 85 FR 21854 
(December 15, 2020) (File No. SR-MSRB-2020-09).
    \14\ For example, dealers informed the MSRB that information 
required to complete manual submission of certain new data elements 
must be obtained from their fixed income trading desks and then 
reported to EMMA Dataport by back-office personnel responsible for 
such data entry. Dealers must identify appropriate staff and create 
procedures to operationalize the new information gathering and 
amended Form G-32 reporting process.
---------------------------------------------------------------------------

    The MSRB published the updated ``EMMA Dataport Manual for Primary 
Market Submissions'' (``manual'') on January 29, 2021.\15\ While the 
MSRB previously provided dealers with access to the new amended Form G-
32 in October 2020 through the new Form G-32 clarifying amendment, the 
MSRB believes providing a further extension of time from March 31, 2021 
to August 2, 2021, will afford dealers the time they deem necessary to 
implement policies and procedures and to conduct appropriate staff 
training to effectively operationalize compliance with new Form G-32.
---------------------------------------------------------------------------

    \15\ See ``Emma Dataport Manual for Primary Market 
Submissions,'' Version 3.0, January 2021, effective August 2021.
---------------------------------------------------------------------------

2. Statutory Basis
    The MSRB believes that the proposed rule change is consistent with 
Section 15B(b)(2)(C) of the Exchange Act,\16\ which provides that the 
MSRB's rules shall:
---------------------------------------------------------------------------

    \16\ 15 U.S.C. 78o-4(b)(2)(C).

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 and 
municipal financial products, to remove impediments to and perfect 
the mechanism of a free and open market in municipal securities and 
municipal financial products, and, in general, to protect investors, 
---------------------------------------------------------------------------
municipal entities, obligated persons, and the public interest.

    The proposed rule change does not alter any rule language but 
provides dealers with additional time to comply with certain 
obligations under MSRB Rule G-32. In addition, the proposed rule change 
will alleviate some of the operational challenges dealers may be 
experiencing and allow them to more

[[Page 11819]]

effectively allocate resources to implement new Form G-32 effectively, 
which would (1) promote just and equitable principles of trade, (2) 
foster cooperation and coordination with persons engaged in regulating 
and processing information with respect to transactions in municipal 
securities, and (3) remove impediments to and perfect the mechanism of 
a free and open market in municipal securities. The proposed rule 
change would promote just and equitable principles of trade by 
providing additional time for dealers to establish compliance 
procedures to ensure that all applicable fields are complete and 
accurate. In turn, more accurate and complete information will enhance 
the MSRB's regulatory transparency initiatives and facilitate the 
MSRB's own usage of data, which the MSRB believes helps remove 
impediments to, and promotes the mechanisms of a free and open market 
and fosters cooperation and coordination with persons engaged in 
regulating and processing information with respect to transactions in 
municipal securities.

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

    Section 15B(b)(2)(C) of the Act requires that MSRB rules be 
designed not to impose any burden on competition not necessary or 
appropriate in furtherance of the purposes of the Act.\17\ The MSRB 
does not believe that the proposed rule change will impose any burden 
on competition not necessary or appropriate in furtherance of the 
Exchange Act. The goal of the proposed rule change is to grant 
additional time for dealers to meet certain obligations under Rule G-32 
during the exigent circumstances of the COVID-19 pandemic but would not 
alter their underlying obligations under MSRB rules.
---------------------------------------------------------------------------

    \17\ Id.
---------------------------------------------------------------------------

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 on the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \18\ and Rule 19b-
4(f)(6) \19\ thereunder. At any time within 60 days of the filing of 
the proposed rule change, the Commission summarily may temporarily 
suspend such 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.
---------------------------------------------------------------------------

    \18\ 15 U.S.C. 78s(b)(3)(A).
    \19\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-MSRB-2021-01 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549.

All submissions should refer to File Number SR-MSRB-2021-01. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (http://www.sec.gov/rules/sro.shtml). 
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 website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549 on official business days between the hours of 10:00 a.m. and 
3:00 p.m. Copies of the filing also will be available for inspection 
and copying at the principal office of the MSRB. All comments received 
will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-MSRB-2021-01 and should be submitted on 
or before March 19, 2021.
---------------------------------------------------------------------------

    \20\ 17 CFR 200.30-3(a)(12).

    For the Commission, pursuant to delegated authority.\20\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-03948 Filed 2-25-21; 8:45 am]
BILLING CODE 8011-01-P