Clarification on Recent Amendment requiring Disclosure of Designation Information Pursuant to Rule G-11(g)(iii)
The Securities and Exchange Commission recently
approved amendments to Board rules regarding syndicate practices.(1)
One of the amendments to rule G-11, on sales of new issue municipal securities during the
underwriting period, concerns the disclosure of designation information. The amendment to
rule G-11(g)(iii) requires the managing underwriter to disclose to syndicate members all
available designation information within 10 business days following the date of sale and
all information with the sending of the designation checks. The amendment does not require
that the identity of the investors providing the designations be disclosed; the only
disclosure required is the total amount of the designations for each dealer.
Questions have arisen as to whether the requirement to disclose all designation information means that each syndicate member is provided information for all syndicate members or only the information pertaining to that particular syndicate member. The requirement is that all designation information be disclosed to each syndicate member.
A notice describing the syndicate practices rule amendments can be found at the Board's Web site (www.msrb.org).
December 11, 1998
ENDNOTES
1. The amendments were approved by the SEC on November 27, 1998, and the amendments became effective on that date. See Sec. Exch. Act Rel. No. 40717 (November 27, 1998).
