[Federal Register Volume 60, Number 124 (Wednesday, June 28, 1995)]
[Notices]
[Pages 33447-33448]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-15809]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35879; File No. SR-MSRB-95-11]
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
June 21, 1995.
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 June 16, 1995, 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\
\1\ The Board plans to publish the interpretations in MSRB
Reports Vol. 15, no. 2, at 3 (July 1995). 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\ Since that time, the Board has received
numerous inquiries concerning the application of the rule. In order to
assist the municipal securities industry and, in particular, brokers,
dealers and municipal securities dealers in understanding and complying
with the provisions of the rule, the Board published four prior notices
of interpretation which set forth, in question-and-answer format,
general guidance on rule G-37.\3\ In prior filings with the Commission,
the Board stated that it will continue to monitor the application of
rule G-37, and, from time to time, will publish additional notices of
interpretations, as necessary.\4\ In light of questions recently
received from market participants concerning the applicability of the
rule to contributions to issuer officials seeking election to the U.S.
Presidency, as well as the operation of the exemption provision set
forth in section (i) of rule G-37, the Board has determined that it is
necessary to provide further guidance to the municipal industry.
Accordingly, the Board is publishing this fifth set of questions and
answers.
\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 14, 1994); Securities Exchange Act Release
No. 34603 (Aug. 25, 1994), 59 FR 45049 (Aug. 31, 1994); Securities
Exchange Act Release No. 35128 (Dec. 20, 1994), 59 FR 66989 (Dec.
28, 1994) and Securities Exchange Act Release No. 35544 (Mar. 28,
1995), 60 FR 16896 (Apr. 3, 1995). See also MSRB Reports Vol. 14,
No. 3 at 11-16 (June 1994); Vol. 14, No. 4 at 31-32 (August 1994);
Vol. 14, No. 5 at 8 (December 1994) and Vol. 15, No. 1 (April 1995)
at 21; MSRB Manual, General Rules, Rule G-37 (CCH) para. 3681.
\4\ File Nos. SR-MSRB-94-6, SR-MSRB-94-15, SR-MSRB-94-16 and SR-
MSRB-95-02.
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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
manicipal securities, and, in general, to protect investors and the
public interest.
B. Self-Regulatory Organization's Statement of 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., [[Page 33448]] 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-
95-11 and should be submitted by July 19, 1995.
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. 95-15809 Filed 6-27-95; 8:45 am]
BILLING CODE 8010-01-M
