[Federal Register Volume 81, Number 217 (Wednesday, November 9, 2016)]
[Notices]
[Pages 78872-78873]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-27021]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-79225; File No. SR-MSRB-2016-13]
Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Notice of Filing and Immediate Effectiveness of a Proposed Rule
Change To Amend the Requirements in MSRB Rule A-4, on Meetings of the
Board, Regarding the Formation of a Quorum
November 3, 2016.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act'' or ``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\
notice is hereby given that on October 24, 2016, the Municipal
Securities Rulemaking Board (the ``MSRB'' or ``Board'') filed with the
Securities and Exchange Commission (``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.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The MSRB filed with the Commission a proposed amendment to MSRB
Rule A-4, on meetings of the Board, to amend the requirements regarding
the formation of a quorum (the ``proposed rule change''). The MSRB has
designated the proposed rule change as concerned solely with the
administration of the self-regulatory organization under paragraph
(f)(3) of Rule 19b-4 under the Act,\3\ which renders the proposal
effective upon receipt of this filing by the Commission. The proposed
rule change is concerned solely with the administration of the MSRB in
that it simply amends the quorum requirements applicable to the Board.
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\3\ 17 CFR 240.19b-4(f)(3).
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The text of the proposed rule change is available on the MSRB's Web
site at www.msrb.org/Rules-and-Interpretations/SEC-Filings/2016-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 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 Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010 (the ``Dodd-Frank Act'') \4\ amended Section 15B of the Exchange
Act \5\ to provide for the regulation by the Commission and the MSRB of
municipal advisors. The Dodd Frank Act grants the MSRB broad rulemaking
authority over municipal advisors and municipal advisory activities.\6\
The Dodd-Frank Act also requires that the MSRB Board include persons
associated with a municipal advisor. Specifically, Section 15B(b)(1) of
the Exchange Act \7\ requires that the MSRB Board include at least one
individual who is associated with a municipal advisor (an ``advisor
representative'') among the members of the Board that are ``regulated
representatives,'' as that term is used in Section 15B(b)(1).\8\ The
composition of the MSRB Board reflects and complies with this
requirement.
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\4\ Pub. Law No. 111-203, 124 Stat. 1376 (2010).
\5\ 15 U.S.C. 78o-4.
\6\ See Section 15B(b)(2) of the Exchange Act (15 U.S.C. 78o-
4(b)(2)).
\7\ 15 U.S.C. 78o-4(b)(1).
\8\ Id.
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The MSRB has adopted administrative rules that pertain to the
operation and administration of the Board, which are identified by the
prefix A,\9\ and include MSRB Rule A-4, regarding quorum and voting
requirements. Existing Rule A-4(c) provides that a quorum of the Board
shall consist of two-thirds of the members of the whole Board, which
must include at least one member of the Board who is a public
representative, at least one member who is a broker-dealer
representative and at least one member who is a bank representative.
Existing Rule A-4(c) also provides that any action taken by the
affirmative vote of a majority of the whole Board at any meeting at
which a quorum is present, shall, except as otherwise provided by rule
of the Board, constitute the action of the Board. Rule A-4(c) also
provides for Board action by resolution, except where otherwise
specified by the Exchange Act or a rule of the Board.
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\9\ See MSRB Rule A-1.
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The MSRB proposes to amend Rule A-4(c) to incorporate a requirement
that at least one member of any Board group constituting a quorum be an
advisor representative. The proposed rule change ensures representation
of all categories of persons required to be members of the Board in any
quorum established under Rule A-4. The MSRB also proposes minor
technical amendments to Rule A-4(c) to clarify the provision.
2. Statutory Basis
The MSRB has adopted the proposed rule change pursuant to Sections
15B(b)(1) and (2) of the Exchange Act,\10\ which require, among other
things, that the Board include at least one individual who is
associated with a municipal advisor, and the rules of the Board
establish fair procedures for the nomination and election of members of
the Board and assure fair representation in such nominations and
elections of public representatives, broker-dealer representatives,
bank representatives, and advisor representatives and the terms that
shall be served by such members. The MSRB believes the proposed rule
change is appropriate and consistent with Sections 15B(b)(1) and (2) of
the Exchange Act \11\ in that the proposed rule change would amend the
quorum requirements in a manner consistent with requirements regarding
the composition of the Board that were previously put in place.\12\ The
MSRB also believes the proposed rule change appropriately complements
the Board's governance procedures that are structured to obtain the
diverse views of the public and various entities that are
[[Page 78873]]
subject to the MSRB's regulation and oversight and to provide for their
representation in the decision-making processes of the Board.
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\10\ 15 U.S.C. 78o-4(b)(1)-(2).
\11\ Id.
\12\ See Securities Exchange Act Release No. 63025 (Sept. 30,
2010), 75 FR 61806 (Oct. 6, 2010) (File No. SR-MSRB-2010-08) (SEC
order approving amendments to Rule A-3 to provide for, among other
requirements, municipal advisor representation on the MSRB Board).
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B. Self-Regulatory Organization's Statement on Burden on Competition
Section 15B(b)(2)(C) of the Act \13\ requires that MSRB rules not
be designed to impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act. The MSRB
believes that the proposed rule change does not impose any burden on
competition not necessary or appropriate in furtherance of the purposes
of the Act, in that the proposed rule change simply amends the quorum
requirements applicable to the MSRB Board, and does not affect or
impose a burden on competition.
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\13\ 15 U.S.C. 78o-4(b)(2)(C).
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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
The foregoing proposed rule change has become effective pursuant to
Section 19(b)(3)(A) of the Act \14\ and paragraph (f) of Rule 19b-4
thereunder.\15\ 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.
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f).
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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-2016-13 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-2016-13. 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 Web site (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 Web site 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; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-MSRB-2016-13 and should be
submitted on or before November 30, 2016.
For the Commission, pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2016-27021 Filed 11-8-16; 8:45 am]
BILLING CODE 8011-01-P