MSRB Files Amendments to Rule A-15 Relating to Notification to Board of Change in Status or Change of Name and Address

On February 14, 2011, the Municipal Securities Rulemaking Board (the “MSRB”) filed with the Securities and Exchange Commission (the “SEC”) proposed amendments to MSRB Rule A-15 requiring notice to the Board of a change in status or a change in name and address.  The rule, as amended, would be applicable to brokers, dealers, municipal securities dealers, and municipal advisors.[1]  The amendment will become operative on March 17, 2011.

BACKGROUND

The proposed rule change consists of amendments to Rule A-15 (on notice of termination of municipal securities activities) that extend the coverage of the rule to municipal advisors that have terminated their municipal advisory activities and expand the circumstances under which notification must be provided to the MSRB to include involuntary terminations and suspensions of regulated activities due to bar or suspension by regulatory agencies or judicial authorities or otherwise, and, with respect to brokers, dealers and municipal securities dealers (“dealers”), expulsion or suspension from membership or participation in a national securities exchange or registered securities association. 

Although existing Rule A-15 establishes a procedure for notification of a change in status (e.g. ceasing to be engaged in municipal securities activities) by dealers, it does not apply to municipal advisors.  Further, existing Rule A-15 does not require notification to the MSRB in the event of involuntary termination or suspension of municipal securities activities.

Questions on the rule change may be directed to Peg Henry, Deputy General Counsel, or Karen Du Brul, Associate General Counsel, at (703) 797-6600.  

February 14, 2011

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TEXT OF AMENDMENT[2]

Rule A-15: Notification to Board of Termination of Municipal Securities Activities Change in Status or and Change of Name or Address

(a)  Procedure for Notifying Board of Change in Status Termination.  A broker, dealer, or municipal securities dealer, or municipal advisor must promptly notify the Board that if it ceases to be engaged in municipal securities activities must promptly  notify the Board of such broker’s, dealer’s or municipal securities dealer’s change of status by filing with the Board a or municipal advisory activities, whether voluntarily or because it has been barred or suspended from engaging in municipal securities activities or municipal advisory activities by the appropriate regulatory agency, judicial authority or otherwise.  A broker, dealer, or municipal securities dealer must also notify the Board if it has been expelled or suspended from membership or participation in a national securities exchange or registered securities association.  Any notification required by this rule shall be provided in a written statement setting forth such broker’s, dealer’s, municipal securities dealer’s, or municipal advisor’s name, address, Commission registration number, and a description of, and the reasons for, its change in status. the fact that such broker, dealer or municipal securities dealer is no longer engaging in municipal securities activities.

 (b)  Obligation to Pay Fees. A broker, dealer, or municipal securities dealer, or municipal advisor that files notification with the Board pursuant to section (a) of this rule shall be obligated to pay the fees owed to the Board at the time of filing of such notification.

(c)  Notification of Name or Address Change. Each broker, dealer, or municipal securities dealer, or municipal advisor that has followed the procedure set forth in Board rRule A-12 shall notify the Board promptly of any changes to the information required by rRule A-12.