Document and information at time of submission of official statement. The official statement would be required under revised Rule G32(b)(i)(B)(1) to be submitted to EMMA, along with related Form G32 information, within one business day after receipt from the issuer or its designated agent, but by no later than the closing date. The underwriter would be required to submit, along with or prior to the submission of the official statement, the following items with respect to each issue:

In the typical offering, the submission of the document to EMMA within one business day of receipt from the issuer would be preceded by the required initial submission of information on or prior to the date of first execution of a transaction in the securities. However, in those cases where the official statement submission deadline precedes the date of first execution (for example, if the underwriter has received the official statement in advance of the date of first execution), the underwriter would be required to submit, along with or prior to the submission of the official statement and the items of information identified above, the following additional items with respect to each issue (which otherwise would be required to be submitted by no later than the date of first execution): \39\ \39\ Other items normally required to be submitted by no later than the time of first execution would continue to be required by such deadline.

Summary of Basic Information Requirements. The items of information to be submitted and the timing of such submissions through Form G32 under revised Rule G32 for submissions not
[[Page 15198]]
requiring additional information (as described below) is summarized in the following table:
Item Timing Full issuer name/issue description.... Earlier of (i) date of first execution and (ii) date of official statement submission. 9digit CUSIP number.................. Earlier of (i) date of first execution and (ii) later of (a) officia

SUMMARY:

Securities and Exchange Commission,

DOCUMENT BODY 2:

March 27, 2009.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b4 thereunder,\2\ notice is hereby given that on March 23, 2009, the Municipal Securities Rulemaking Board (``MSRB'') filed with the Securities and Exchange Commission (``Commission'' or ``SEC'') the proposed rule change as described in Items I, II, and III below, which Items have been substantially 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 240.19b4.
I. SelfRegulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change

The MSRB has filed with the Commission a proposed rule change to implement an electronic system for free public access to primary market disclosure documents and transaction price information for the municipal securities market through the MSRB's Electronic Municipal Market Access system (``EMMA''). The proposed rule change would: (i) Establish EMMA's permanent primary market disclosure service (the ``primary market disclosure service'') for electronic submission and public availability on EMMA's Internet portal (the ``EMMA portal'') of official statements, advance refunding documents and related primary market documents and information (the ``EMMA primary market disclosure proposal''); (ii) establish EMMA's permanent transparency service (the ``trade price transparency service'') making municipal securities transaction price data publicly available on the EMMA portal (the ``EMMA trade price transparency proposal''); (iii) establish a real time subscription to the primary market document collection (the ``primary market disclosure subscription proposal''); (iv) terminate the existing pilot EMMA facility of the Municipal Securities Information Library (MSIL) system (the ``primary market pilot'') and suspend submissions of official statements, advance refunding documents and Forms G36(OS) and G36(ARD) to the MSIL system (the ``system transition proposal'') and (v) amend and consolidate current Rules G32 and G36 into new Rule G32 on disclosures in connection with primary offerings, replace current Forms G36(OS) and G36(ARD) with new Form G32, provide transitional submission requirements, and amend certain related recordkeeping requirements, to establish an ``access equals delivery'' standard for electronic official statement dissemination in the municipal securities market (the ``rule change proposal'').

The MSRB has requested approval to commence operation of EMMA's primary market disclosure service and trade price transparency service on a permanent basis, and to make the provisions of the rule change proposal effective, on the later of (i) May 11, 2009 or (ii) the date announced by the MSRB in a notice published on the MSRB Web site, which date shall be no earlier than ten business days after Commission approval of the proposed rule change and shall be announced no fewer than five business days prior to such date (the ``effective date'').

The text of the proposed rule change is available on the MSRB's Web site (http://www.msrb.org/msrb1/sec.asp), at the MSRB's principal office, and at the Commission's Public Reference Room.
II. SelfRegulatory 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. SelfRegulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change

1. Purpose

The proposed rule change would implement an electronic system for free public access to primary market disclosure documents and transaction price information for the municipal securities market. The proposed rule change consists of: (i) The EMMA primary market disclosure proposal to provide for electronic submission and public availability on the EMMA portal of official statements, certain preliminary official statements, advance refunding documents and amendments thereto (``primary market disclosure documents''), together with related information; (ii) the EMMA trade price transparency proposal to make municipal securities transaction price data publicly available on the EMMA portal; (iii) the primary market disclosure subscription proposal to establish a realtime subscription to the primary market disclosure document collection; (iv) the system transition proposal to terminate the existing primary market pilot and suspend submissions to the MSIL system; and (v) the rule change proposal to amend and consolidate MSRB rules on official statement deliveries to establish an ``access equals delivery'' standard for electronic official statement dissemination in the municipal securities market.

Existing primary market disclosure document delivery requirements under MSRB rules are described briefly below, followed by a discussion of each of these proposals.

Current Delivery Requirements

Under current Rule G32, a broker, dealer or municipal securities dealer (``dealer'') selling a new issue municipal security to a customer during the period ending 25 days after bond closing (the ``new issue disclosure period'') must, with certain limited exceptions, deliver the official statement to the customer on or prior to trade settlement. In cases where an official statement is not produced by the issuer, the dealer is required to instead provide a preliminary official statement, if available. The dealer also must provide certain additional information about the underwriting (including initial offering prices and information about underwriter compensation) if the issue was purchased by the underwriter in a negotiated sale. These additional items of information typically are disclosed in the official statement but must be provided separately by the selling dealer if not included in the official statement. Furthermore, selling dealers and the managing underwriter must send official statements to purchasing dealers promptly upon request, and dealer financial advisors that prepare the official statement must provide such official statement to the managing underwriter promptly.

[[Page 15191]]

Current Rule G36 requires dealers acting as underwriters, placement agents or remarketing agents for primary offerings of municipal securities (``underwriters'') to submit official statements, accompanied by Form G36(OS), for most primary offerings of municipal securities to the MSRB. For offerings subject to Exchange Act Rule 15c212, the official statement must be sent within one business day after receipt from the issuer but no later than ten business days after the bond sale. With limited exceptions, official statements prepared for any other offerings must be sent by the later of one business day after receipt from the issuer or one business day after bond closing. Amendments to the official statement during the new issue disclosure period also must be submitted to the MSRB. In addition, if the offering is an advance refunding and an advance refunding document has been prepared, the advance refunding document and Form G36(ARD) must be sent by the underwriter to the MSRB within five business days after bond closing. Official statements and advance refunding documents may currently be submitted in either paper or electronic format. These submissions are collected by the Municipal Securities Information Library (MSIL) system into a comprehensive library. The MSRB makes these documents available to paid subscribers as portable document format (PDF) files on a compact disk sent daily to subscribers, and also makes them available to the public, subject to copying charges, at the MSRB's public access facility in Alexandria, Virginia.

Description of the EMMA Primary Market Disclosure Proposal

The EMMA primary market disclosure proposal would establish, as a component of EMMA, the EMMA primary market disclosure service for the receipt of, and for making available to the public of, official statements, preliminary official statements and advance refunding documents, including amendments thereto (collectively, ``primary market disclosure documents''), and related information, to be submitted by or on behalf of underwriters under revised Rule G32, as proposed in the rule change proposal described below.\3\ As proposed, all primary market disclosure documents would be submitted to the MSRB, free of charge, through an Internetbased electronic submitter interface or electronic computertocomputer data connection, at the election of the submitter. Public access to the documents and information would be provided through the EMMA primary market disclosure service on the Internet through the EMMA portal at no charge as well as through a paid realtime data stream subscription service.\4\ In connection with each primary offering for which information is required to be submitted to EMMA pursuant to revised Rule G32, the submitter would provide, at the time of submission, information required to be included on new Form G 32. The items of information to be included on new Form G32 and the timing requirements for providing such information are set forth in the description of the rule change proposal below.
\3\ EMMA was originally established, and began operation on March 31, 2008, as a complementary pilot facility of the MSRB's existing Official Statement and Advance Refunding Document (OS/ARD) system of the MSIL system. See Securities Exchange Act Release No. 57577 (March 28, 2008), 73 FR 18022 (April 2, 2008) (File No. SR MSRB200706) (approving operation of the EMMA pilot to provide free public access to the MSIL system collection of official statements and advance refunding documents and to the MSRB's RealTime Transaction Reporting System historical and realtime transaction price data) (the ``Pilot Filing''). The pilot EMMA facility would be replaced, and EMMA would become a permanent facility of the MSRB, by the establishment of the EMMA primary market disclosure service and EMMA trade price transparency service proposed in this filing, together with such other EMMA services established by the MSRB from time to time. See Securities Exchange Act Release No. 59061 (December 5, 2008), 73 FR 75778 (December 12, 2008) (File No. SR MSRB200805) (approving the continuing disclosure service of EMMA with an effective date of July 1, 2009). See also Securities Exchange Act Release No.59212 (January 7, 2009), 74 FR 1741 (January 13, 2009) (File No. SRMSRB200807) (approving the establishment of the shortterm obligation rate transparency service of EMMA). Although the MSIL system would no longer accept and process submissions by underwriters upon establishment of the EMMA primary market disclosure service as provided in the system transition proposal, it would continue to operate for a period of time primarily to serve certain internal MSRB functions.
\4\ The pilot EMMA portal currently is accessible at http:// www.emma.msrb.org.

The MSRB proposes that submissions of primary market disclosure documents to the EMMA primary market disclosure service be made as portable document format (PDF) files configured to permit documents to be saved, viewed, printed and retransmitted by electronic means. If the submitted file is a reproduction of the original document, the submitted file must maintain the graphical and textual integrity of the original document. For any document submitted to the EMMA primary market disclosure service on or after January 1, 2010, such PDF file must be wordsearchable (that is, allowing the user to search for specific terms used within the document through a search or find function available in most standard software packages), provided that diagrams, images and other nontextual elements would not be required to be wordsearchable due to current technical hurdles to uniformly producing such elements in wordsearchable form without incurring undue costs. Although the MSRB would strongly encourage submitters to immediately begin making submissions as wordsearchable PDF files (preferably as native PDF or PDF normal files, which generally produce smaller and more easily downloadable files as compared to scanned PDF files), implementation of this requirement would be deferred as noted above to provide issuers, underwriters and other relevant market participants with sufficient time to adapt their processes and systems to provide for the routine creation or conversion of primary market disclosure documents as wordsearchable PDF files.

All submissions to the EMMA primary market disclosure service pursuant to this proposal would be made through password protected accounts on EMMA by: (i) Underwriters, which may submit any documents with respect to municipal securities which they have underwritten; and (ii) designated agents, which may be designated by underwriters to make submissions on their behalf. Underwriters would be permitted under the proposal to designate agents to submit documents and information on their behalf, and would be able to revoke the designation of any such agents, through the EMMA online account management utility. Such designated agents would be required to register to obtain password protected accounts on EMMA in order to make submissions on behalf of the designating underwriters.

As proposed, electronic submissions of primary market disclosure documents through the EMMA primary market disclosure service would be made by underwriters and their agents, at no charge, through secured, passwordprotected interfaces. Submitters would have a choice of making submissions to the proposed EMMA primary market disclosure service either through a Webbased electronic submission interface or through electronic computertocomputer data connections with EMMA designed to receive submissions on a bulk or continuous basis.

All documents and information submitted through the EMMA primary market disclosure service pursuant to this proposal would be available to the public for free through the EMMA portal on the Internet, with documents made available for the life of the securities as
[[Page 15192]]
PDF files for viewing, printing and downloading.\5\ As proposed, the EMMA portal would provide online search functions to enable users to readily identify and access documents that relate to specific municipal securities based on a broad range of search parameters. The EMMA portal also would permit users to request to receive alerts, at no charge, if a primary market disclosure document has become available on the EMMA portal or has been updated or amended \6\ and may also provide, at the election of the MSRB, summary data/statistical snapshots relating to documents and information submitted to the EMMA primary market disclosure service. In addition, the MSRB proposes that realtime data stream subscriptions to primary market disclosure documents submitted to EMMA would be made available for a fee as established under the primary market disclosure subscription proposal described below. The MSRB would not be responsible for the content of the information or documents submitted by submitters displayed on the EMMA portal or distributed to subscribers through the EMMA primary market disclosure subscription service.
\5\ The MSRB understands that software currently is generally available for free that permits users to save, view and print PDF files, as well as to conduct word searches in wordsearchable PDF documents. The MSRB would provide links for downloading such software on the EMMA portal.
\6\ The timing and reliability of users receiving alerts issued by EMMA is subject to limitations inherent in any emailbased system and users should not rely exclusively on such alerts.

The MSRB has designed EMMA, including the EMMA portal, as a scalable system with sufficient current capacity and the ability to add further capacity to meet foreseeable usage levels based on reasonable estimates of expected usage, and the MSRB would monitor usage levels in order to assure continued capacity in the future.

The MSRB may restrict or terminate malicious, illegal or abusive usage for such periods as may be necessary and appropriate to ensure continuous and efficient access to the EMMA portal and to maintain the integrity of EMMA and its operational components. Such usage may include, without limitation, usage intended to cause the EMMA portal to become inaccessible by other users, to cause the EMMA database or operational components to become corrupted or otherwise unusable, to alter the appearance or functionality of the EMMA portal, or to hyperlink to or otherwise use the EMMA portal or the information provided through the EMMA portal in furtherance of fraudulent or other illegal activities (such as, for example, creating any inference of MSRB complicity with or approval of such fraudulent or illegal activities or creating a false impression that information used to further such fraudulent or illegal activities has been obtained from the MSRB or EMMA). Measures taken by the MSRB in response to such unacceptable usage shall be designed to minimize any potentially negative impact on the ability to access the EMMA portal.

Description of the EMMA Trade Price Transparency Proposal

The EMMA trade price transparency proposal would establish, as a component of EMMA, the EMMA trade price transparency service to make available to the public historical and realtime transaction price information provided through the MSRB's RealTime Transaction Reporting System (``RTRS''), together with related summary and statistical information. Free public access to the transaction price information would be provided through the EMMA trade price transparency service on the Internet through the EMMA portal.\7\ The transaction price information provided through the EMMA trade price transparency service would consist of all data available through RTRS for public dissemination since the inception of RTRS on January 31, 2005. This information could be expanded to include historical price data available through earlier MSRB transaction reporting systems. \7\ In addition to being made available to the public for free through the EMMA portal on the Internet, transaction price information is made available through various subscription products offered by RTRS through existing RTRS mechanisms. See http:// www.msrb.org/msrb1/TRSweb/rtrssubscription.asp. The EMMA trade price transparency service would be distinct from any such services or products provided directly by RTRS.

As proposed, the EMMA portal would provide online search functions to enable users to readily access transaction price information based on a broad range of search parameters. The MSRB may elect to expand its alert function on the EMMA portal to permit users to request to receive periodic alerts, at no charge, regarding whether trades have been reported in a specific security \8\ and to provide on the EMMA portal summary data/statistical snapshots of price data available through RTRS. The MSRB would not be responsible for the information reported by dealers to RTRS that is displayed on the EMMA portal.
\8\ For example, a user could receive an endofday email alert on any day during which a particular security has been reported as having traded. Such alerts would not be available on a realtime basis and would not provide tradebytrade alerts. The timing and reliability of users receiving alerts issued by EMMA is subject to limitations inherent in any emailbased system and users should not rely exclusively on such alerts.
Description of the Primary Market Disclosure Subscription Proposal

The realtime data stream subscription to the EMMA primary market disclosure service to be provided through a Web service would be made available for an annual fee of $20,000.\9\ The primary market disclosure subscription service would make available to subscribers all primary market disclosure documents and related information provided by submitters through the EMMA submission process that is posted on the EMMA portal. Such documents and information would be made available to subscribers simultaneously with the posting thereof on the EMMA portal. \9\ The proposed subscription price would cover a portion of the administrative, technical and operating costs of the EMMA primary market disclosure subscription service but would not cover all costs of such subscription service or of the EMMA primary market disclosure service. The MSRB has proposed establishing the subscription price at a fair and reasonable level consistent with the MSRB's objective that subscriptions be made available on terms that promote the broad dissemination of documents and data throughout the marketplace.

Data with respect to the EMMA primary market disclosure service to be provided through the realtime data stream would consist of the following elements, among others and as applicable, as would be more specifically set forth in the EMMA Primary Market Subscriber Manual posted on the EMMA portal: (i) Submission data, including submission ID, submission type, submission status and submission transaction date/ time; (ii) offering data, including offering type, underwriting spread/ disclosure indicator, and official statement/preliminary official statement availability status; (iii) issue data, including issue type, security type, issuer name, issue description, state of issuer, six digit CUSIP (for commercial paper issues), expected closing date, dated date and original dated date (for certain remarketings); (iv) security data, including ninedigit CUSIP, securityspecific dated date (for certain securities not having CUSIP numbers), principal amount at maturity, initial offering price or yield, maturity date, interest rate, partial underwriting data and refunded security CUSIP numbers; (v) document data, including document ID, document type, document description, document posting date, document status indicators [[Page 15193]]
and refunding and refunded issue identifiers (for advance refunding documents); (vi) file data, including file ID, file posting date and file status indicators; and (vii) limited offering contact data, including contact name, address and phone number (for obtaining official statements not available on EMMA for certain primary offerings not subject to Rule 15c212 by virtue of paragraph (d)(1)(i) thereof).

The EMMA Primary Market Subscriber Manual would set forth a complete, uptodate listing of all data elements made available through the primary market disclosure subscription service, including detailed definitions of each data element, specific data format information, and information about technical data elements to support transmission and dataintegrity processes between EMMA and subscribers.

Subscriptions would be provided through computertocomputer data streams utilizing XML files for data and files in a designated electronic format (consisting of PDF files) for documents. Appropriate schemas and other technical specifications for accessing the Web services through which the realtime data stream are to be provided would be set forth in the EMMA Primary Market Subscriber Manual.

The MSRB would make the primary market disclosure subscription service available on an equal and nondiscriminatory basis. In addition, the MSRB would not impose any limitations on or additional charges for redistribution of such documents by subscribers to their customers, clients or other endusers. Subscribers would be subject to all of the terms of the subscription agreement to be entered into between the MSRB and each subscriber, including proprietary rights of third parties in information provided by such third parties that is made available through the subscription. The MSRB would not be responsible for the content of the information or documents submitted by submitters distributed to subscribers through the primary market disclosure subscription service.

Description of System Transition Proposal

The system transition proposal would terminate the existing primary market pilot \10\ by deleting the pilot provisions from the MSIL facility and would suspend the MSIL system's functions of receiving submissions of official statements and advance refunding documents. \10\ In establishing the primary market pilot, the MSRB had requested that the Commission approve the primary market pilot for a period of one year from the date it became operational, which was March 31, 2008. The MSRB has requested in a separate filing that the Commission approve the extension of the primary market pilot to the earlier of July 1, 2009 or the effective date of the permanent primary market disclosure service. See File No. SRMSRB200901. Description of the Rule Change Proposal

The rule change proposal would effect extensive revisions to the official statement submission and dissemination requirements set forth in current MSRB rules in order to implement an ``access equals delivery'' model based on rules for final prospectus delivery for registered securities offerings adopted by the Commission in 2005.\11\ The rule change proposal would consolidate and amend existing provisions of current Rules G32 and G36 into revised Rule G32, on disclosures in connection with primary offerings, and would make conforming changes to Rule G8, on recordkeeping, and Rule G9, on preservation of records. Rule G36 would be rescinded by the proposal. In addition, the rule change proposal would establish a new electronic Form G32 in connection with submissions made by underwriters to EMMA and would discontinue current Form G36(OS) and Form G36(ARD). \11\ See Securities Act Release No. 8591 (July 19, 2005), 70 FR 44722 (August 3, 2005). The rule change proposal would incorporate (with modifications adapted to the specific characteristics of the municipal securities market) many of the key ``access equals delivery'' provisions in Securities Act Rule 172, on delivery of prospectus, Rule 173, on notice of registration, and Rule 174, on delivery of prospectus by dealers and exemptions under Section 4(3) of the Securities Act of 1933, as amended.

Underwriters would be required under revised Rule G32 to submit all primary market disclosure documents and related information to EMMA in electronic format, replacing the current submission process through the MSIL system pursuant to existing Rule G36. Dealers selling most municipal securities in a primary offering to customers would be required under revised Rule G32 to notify customers of the availability of official statements through EMMA (and, at the election of the dealer, any qualified portals) and to provide written copies of official statements to any customers requesting such copies. Except in the case of sales of municipal fund securities, dealers would no longer be required to provide printed copies of official statements to customers in primary offerings.

Underwriters should be especially sensitive to the necessity of timely and accurate submissions to EMMA of official statements, preliminary official statements (when required), any amendments thereto, and all related information to be supplied through Form G32. In particular, with the adoption of the ``access equals delivery'' standard, submissions to EMMA will become the lynchpin to the municipal securities primary market disclosure system that ensures that official statements are available to investors and the general public in a timely manner. Thus, any failure by the underwriter to make the required submission to EMMA within one business day after receipt from the issuer, but in no event later than the closing date,\12\ would have significant repercussions to the ability of investors to access the document. The MSRB expects that the timing requirements of revised Rule G32 will be strictly adhered to and enforced to promote the purposes of the rule and the protection of investors.
\12\ The MSRB views it as critical that official statements be available to investors by no later than the new issue's closing date since such date represents the first time at which executed trades may be settled.

The MSRB's disclosure rules with respect to newly issued municipal securities are multifaceted and require diligence on the part of dealers to ensure that mandated disclosures are made at certain key points in the process of selling such securities to customers. Thus, dealers are reminded that, in addition to their obligations under Rule G32, they are required under Rule G17, on fair practice, to provide to the customer, at or prior to the time of trade, all material facts about the transaction known by the dealer as well as material facts about the security that are reasonably accessible to the market.\13\ The time of trade is generally the time at which an enforceable agreement is reached to execute a municipal securities transaction (sometimes referred to as trade execution). Disclosures made at or prior to the time of trade are intended to provide the customer with material information that he or she may use in making an investment decision.
\13\ See Rule G17 InterpretationInterpretive Notice Regarding Rule G17, on Disclosure of Material Facts, March 20, 2002, reprinted in MSRB Rule Book.

The proposed rule change does not alter the time of trade disclosure obligation under Rule G17. Disclosures made after the time of trade, such as by delivery of the official statement or by customer access to the official statement on EMMA at or near trade settlement, do not substitute for the required material disclosures that must be made at or prior to the time of trade pursuant to Rule G17. In the new issue market,
[[Page 15194]]
the preliminary official statement, when available, often is used by dealers marketing new issues to customers and can serve as a primary vehicle for providing the required timeoftrade disclosures under Rule G17, depending upon the accuracy and completeness of the preliminary official statement as of the time of trade. Dealers should note that additional or revised material information provided to the customer subsequent to the time of trade (such as in a revised preliminary official statement, the final official statement or through any other means) cannot cure a failure to provide the required material information at or prior to the time of trade.\14\ However, a revised preliminary official statement or other supplemental information provided to customers after delivery of the original preliminary official statement, but at or prior to the time of trade, can be used to comply with the timeoftrade disclosure obligation under Rule G17. The MSRB has previously emphasized the importance of making material disclosures available to customers in sufficient time to make use of the information in coming to an investment decision, such as through earlier delivery of the preliminary official statement.\15\ The MSRB urges dealers to make preliminary official statements available to their potential customers in a timeframe that provides an adequate opportunity to make the appropriate assessments in coming to an investment decision.
\14\ See Securities Act Rule 159(b) adopted under Section 17(a)(2) of the Securities Act of 1933. Rule 159(b) provides that, for purposes of determining whether a statement includes or represents any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading at the time of sale (including, without limitation, a contract of sale), any information conveyed to the purchaser only after such time of sale (including such contract of sale) will not be taken into account.
\15\ See, e.g., MSRB Notice 200607 (March 31, 2006); MSRB Discussion Paper on Disclosure in the Municipal Securities Market (December 21, 2000), published in MSRB Reports, Vol. 21, No. 1 (May 2001); and Official Statement Deliveries Under Rules G32 and G36 and Exchange Act Rule 15c212 (July 15, 1999), published in MSRB Reports, Vol. 19, No. 3 (Sept. 1999).

The rule change proposal is described in more detail below. Submissions to EMMA

Official Statement and Form G32 Submission Requirement. Under revised Rule G32(b)(i)(A), underwriters would be required to submit information through the electronic Form G32 for all primary offerings of municipal securities, regardless of whether an official statement is produced for such offering.\16\ The specific items of information to be submitted through Form G32, and the manner and timing of such submission, are described below.
\16\ In contrast, submissions are required under current Rule G 36 only for primary offerings for which an official statement is produced.

Under revised Rule G32(b)(i)(B), except as described below, all submissions by underwriters of official statements would be required to be made within one business day after receipt from the issuer but by no later than the closing date \17\ for the offering. Rule G36 currently has separate submission timing for official statements based on whether the primary offering is subject to or exempt from Exchange Act Rule 15c212. For issues subject to such rule, current Rule G36 establishes a final deadline of ten business days after the issuer agrees to sell the offering to the underwriter. This current timeframe does not ensure that official statements are always available by the closing date, particularly in those cases where an offering may be closed fewer than ten business days after the offering is sold. For issues exempt from Exchange Act Rule 15c212, current Rule G36 requires submission of the official statement to the MSRB by the later of one business day after receipt from the issuer or one business day after the closing date. The revised provision is designed to ensure that the official statement is always available by the closing date, regardless of the type of offering.
\17\ ``Closing date'' would be defined in revised Rule G 32(d)(ix) as the date of first delivery of the securities to the underwriter. For bond or note offerings, this would generally correspond to the traditional concept of the bond closing date. In the case of continuous offerings, such as for municipal fund securities, the closing date would be considered to occur when the first securities are delivered.

If an official statement is being prepared for a primary offering but it is not submitted to EMMA by the closing date, the underwriter would be required under revised Rule G32(b)(i)(B)(2) to provide notice of such failure to file and to submit the preliminary official statement, if any, by the closing date, along with notice that the official statement will be submitted to EMMA when it becomes available.\18\ Once an official statement becomes available, the underwriter would be required to submit the official statement within one business day after receipt from the issuer. The submission of the preliminary official statement would not be a cure for a failure to submit the official statement in a timely manner but instead would be an additional obligation of the underwriter incurred upon failing to make timely submission of the official statement.
\18\ Current Rule G36 does not require submission of the preliminary official statement. If no preliminary official statement exists, the underwriter would be required to provide notice of that fact to EMMA under revised Rule G32(b)(i)(D).

Exceptions from Official Statement Submission Requirement. If no official statement is prepared for an offering exempt from Exchange Act Rule 15c212, revised Rule G32(b)(i)(C) would require the underwriter to provide notice of that fact to EMMA, together with the preliminary official statement, if any, by the closing date.\19\ In the case of certain limited offerings,\20\ revised Rule G32(b)(i)(E) would permit the underwriter to elect not to submit the official statement to EMMA if it instead submits to EMMA, by no later than closing: (i) Notice that the offering is not subject to Exchange Act Rule 15c212 by virtue of paragraph (d)(1)(i) and that an official statement has been prepared but is not being submitted to EMMA, and (ii) specific contact information for underwriter personnel to whom requests for copies of the official statement should be made.\21\ An underwriter withholding the official statement for a limited offering would be required to deliver the official statement to each customer purchasing the offered securities from the underwriter or from any other dealer, upon request, by the later of one business day after request or the settlement of the customer's transaction. In addition, submissions to EMMA in connection with rollovers of commercial paper or remarketings of outstanding issues exempt from Rule 15c212 would not be required under revised Rule G32(b)(i)(F) if no new official statement is prepared for the rollover or remarketing or if an official statement has previously been submitted to EMMA in connection with such securities and no amendments or supplements to the official statement
[[Page 15195]]
have been made since such submission.\22\
\19\ Neither such notice nor the preliminary official statement is required to be submitted under current Rule G36. If no
preliminary official statement exists, the underwriter would be required to provide notice of that fact to EMMA under revised Rule G32(b)(i)(D).
\20\ Limited offerings consist of primary offerings under Exchange Act Rule 15c212(d)(1)(i) in which the securities have authorized denominations of $100,000 or more and are sold to no more than 35 persons who the underwriter reasonably believes: (a) have such knowledge and experience in financial and business matters that they are capable of evaluating the merits and risks of the prospective investment, and (b) are not purchasing for more than one account or with a view to distributing the securities.
\21\ Under current Rule G36, underwriters may withhold submission to the MSRB of the official statement for a limited offering without precondition.
\22\ Revised Rule G32 provides for the same treatment of commercial paper official statements as under current Rule G36 but extends that treatment to remarketings exempt from Exchange Act Rule 15c212, to the extent that no new official statement is produced in connection with such remarketing.

Advance Refunding Submissions Requirement. As under current Rule G 36, revised Rule G32(b)(ii) would require that underwriters submit advance refunding documents by no later than five business days after the closing date for primary offerings that advance refund an outstanding issue and for which an advance refunding document has been prepared. This proposed requirement would apply whenever an advance refunding document has been prepared in connection with a primary offering, not just for those offerings in which an official statement also has been prepared as under current Rule G36.

Amendments and Cancellations. Underwriters would be required by revised Rule G32(b)(iii) to submit amendments to official statements and advance refunding documents during the primary offering disclosure period \23\ within one business day of receipt. In addition, underwriters would be required under revised Rule G32(b)(iv) to submit prompt notice of any cancellation of an offering for which a submission of a document or information relating to the offering has previously been made to EMMA. If only a portion of an offering is cancelled, the underwriter's submission in connection with the remaining portion of the offering would be required to be corrected by no later than the closing date to reflect the partial cancellation of the offering. If the entire offering is cancelled, notice of such cancellation would be deemed under paragraph (vi)(C) of Rule G32 to have been submitted to EMMA promptly under paragraph (vi)(C) of Rule G32 if submitted by no later than five business days after the underwriter cancels its trades with customers and other dealers.\24\
\23\ The term ``new issue disclosure period'' under current Rule G32 is renamed as ``primary offering disclosure period'' under revised Rule G32(d)(ix) to emphasize that the rule applies to municipal securities remarketed in a primary offering, not just to new issues of municipal securities.

\24\ See revised Rule G32(b)(vi)(C).

Transitional Submissions. Revised Rule G32(e) establishes transitional provisions for submitting official statements during the five business days preceding the effective date of revised Rule G32 and the primary market disclosure service. In general, any submission to the MSRB of an official statement, advance refunding document or amendment thereto under current Rule G36 becoming due during the five business days prior to the effective date may be held by the underwriter for submission to EMMA on the first two business days on which the primary market disclosure service is effective. The MSRB would reserve the right to require an underwriter that has sent a document in paper form to the MSRB during the five business days prior to the effective date that is received by the MSRB after the effective date to resubmit such document in a designated electronic format through EMMA and the MSRB would require such resubmission through EMMA for any documents sent in paper form to the MSRB on or after the effective date.

Designated Electronic Format of Submitted Documents

Revised Rule G32(b)(vi)(A) would prescribe the format in which documents would be required to be submitted to EMMA as a designated electronic format. Revised Rule G32(d)(iii) would establish PDF files as the initial sole designated electronic format, with files configured to permit documents to be saved, viewed, printed and retransmitted by electronic means. If the submitted file is a reproduction of the original document, the submitted file must maintain the graphical and textual integrity of the original document. In addition, starting on January 1, 2010, such PDF files must be wordsearchable (that is, allowing the user to search for specific terms used within the document through a search or find function available in most standard software packages), provided that diagrams, images and other nontextual elements would not be required to be wordsearchable due to current technical hurdles to uniformly producing such elements in word searchable form without incurring undue costs. Although, the MSRB would strongly encourage submitters to immediately begin making submissions as wordsearchable PDF files (preferably as native PDF or PDF normal files, which generally produce smaller and more easily downloadable files as compared to scanned PDF files), implementation of this requirement would be deferred as noted above to provide issuers, obligated persons and their agents with sufficient time to adapt their processes and systems to provide for the routine creation or conversion of continuing disclosure documents as wordsearchable PDF files.

The MSRB may in the future designate additional computerized formats as acceptable electronic formats for submission or preparation of documents under Revised Rule G32 by means of a filing with the Commission. As noted in the discussion below of comments received in connection with this proposal, the MSRB supports the Commission's Interactive Data and XBRL Initiatives for registered offerings and would consider designating XBRL as a designated electronic format for purposes of submissions to the EMMA primary market disclosure service at such time in the future as appropriate taxonomies for the municipal marketplace have been developed and as issuers begin the process of producing primary market disclosure documents using XBRL.

Submission of Documents as Multiple Files

Underwriters would be permitted to submit official statements and other required documents in the form of one or more electronic files. EMMA permits such submissions as multiple files as an accommodation for those situations where technical or other difficulties preclude or substantially impair the production and submission of the official statement or other document as a single electronic file. Barring such circumstances, underwriters, issuers and investors would be best served if all submissions of documents are made as a single electronic file rather than multiple files. In particular, underwriters should consider the risk of potentially disseminating to the public incomplete disclosure should they, inadvertently or otherwise, fail to submit on a simultaneous or immediately sequential basis all of the required files of a multifile official statement submission.\25\
\25\ Underwriters should note that they are required to submit to EMMA, along with a document, the date such document is received from the issuer. In the case of the official statement, the MSRB would not consider the underwriter to have received the official statement until it has received the complete document. Thus, if the issuer were to provide the official statement to the underwriter in the form of multiple files, the underwriter should not consider the official statement to have been received from the issuer until the final file of such document necessary to complete the official statement has been received. In that case, the underwriter would report the date on which such final file was received as the date on which the official statement (including each file thereof, regardless of any earlier receipt of some such files) was received for purposes of the required information submission.

Form G32

General. New Form G32, which would replace current Form G36(OS) and Form G36(ARD), would include all information required to be submitted by underwriters under revised Rule G
[[Page 15196]]
32(b)(i)(A) and (b)(vi).\26\ Form G32 would consist of a collection of data elements provided to EMMA in connection with a primary offering of municipal securities. When making primary market submissions using the Webbased interface, related indexing information would be entered into an online form or uploaded through an extensible markup language (XML) file, and documents would be uploaded in a designated electronic format. Computertocomputer submissions would utilize XML files for data and PDF files for documents. The proposal would permit Form G32 to be completed in a single session or in multiple sessions, with the initiation of the Form G32 submission process generally occurring earlier than the current Form G36 submission process.\27\ Appropriate procedures and schemas for online and computertocomputer submissions would be published on the EMMA portal and MSRB Web site and would be described in detail in the EMMA Dataport Manual.
\26\ New Form G32 is included in Exhibit 3 to the proposed rule change.
\27\ Under current Rule G36, Form G36 is submitted
simultaneously with the official statement. The rule change proposal would no longer require that the submission of information and the dissemination of such information on EMMA be delayed until the related official statement has become available.

As proposed, underwriters would be required to make a submission through Form G32 in connection with each official statement (or preliminary official statement, where no official statement exists), as well as in connection with each offering for which no official statement or preliminary official statement is to be made available through EMMA.\28\ Information relating to advance refunding documents executed in connection with a primary offering also would be submitted under the proposal through the Form G32 submission process. Submissions during the primary offering disclosure period of amendments to previously submitted documents would be made through the same Form G32 submission initiated in connection with the original documents. \28\ Where no official statement or preliminary official statement is being submitted to EMMA, the underwriter would be required to provide notice thereof to EMMA. Such information would be designed in part to provide through the EMMA portal notice to customers and others that no official statement or preliminary official statement will be available. The proposal would provide for limited exceptions for commercial paper rollovers and remarketings exempt from Rule 15c212 where no new disclosure document is prepared.

Designated Agents. Underwriters would be permitted under revised Rule G32(b)(vi)(C) to designate agents to make submissions on their behalf through the MSRB's user account management and authentication system known as MSRB Gateway.\29\ All submissions made on behalf of an underwriter by a designated agent would be the responsibility of the designating underwriter, and any failure by the designated agent to provide documents or information in a complete, timely and conforming manner would be deemed to be a failure by the designating underwriter. \29\ Current Rule G36 does not permit submissions to the MSRB by agents on behalf of underwriters.

The MSRB notes that Rule G34(a)(ii)(C)(1) requires underwriters for most new issues of municipal securities to provide certain information regarding the new issue to an automated electronic new issue information dissemination system (``NIIDS'') within two hours of the time of formal award of the issue. The MSRB may consider in the future permitting an underwriter to designate to the MSRB that information it has submitted to NIIDS under revised Rule G34 should also be used for purposes of completing new Form G32, although it would not be anticipated that NIIDS would provide documents to EMMA and such submissions would be the responsibility of the underwriter or another designated agent. The MSRB would publish a notice advising if such functionality becomes available.

Standard of Care With Respect to Information Submitted by Underwriters. Much of the information to be provided by underwriters and their agents on new Form G32 normally would be made available to the public through the EMMA portal on a realtime basis under the rule change proposal. The underwriter must exercise due care with respect to the accuracy of the items of information provided on Form G32, although it is understood that much of this information would be subject to change until an issue has reached closing. Until closing, the underwriter would be expected to update promptly any information previously provided by it on Form G32 which may have changed or to correct promptly any inaccuracies in such information, and would be responsible for ensuring that such information provided by it is accurate as of the closing date. Except with regard to the submission of advance refunding documents or amendments to the official statement as described below, the underwriter would not be obligated to update information provided by it on Form G32 due to changes in such information occurring after the closing date, although the underwriter would remain responsible for correcting any information it provided that was erroneous as of the later of the time the information was submitted or the closing date. Information would be deemed to be provided by the underwriter if it has been supplied by the underwriter or a designated agent of the underwriter directly to EMMA or it has been prepopulated by the EMMA Webbased interface to the extent that such information is editable on the EMMA Webbased interface by the underwriter or its designated agent.\30\
\30\ The underwriter would be obligated to review and make any necessary corrections to such editable data. The underwriter would not be responsible for any items of information prepopulated by EMMA which are not editable by the underwriter or its designated agent. With respect to the CUSIP numbers assigned by the CUSIP Service Bureau and other information that is presented during the submission process on EMMA as noneditable information, the underwriter would not be obligated to make corrections to such information. However, the underwriter would be obligated to ensure that each security in a primary offering is correctly associated with the submission the underwriter is making. Thus, pursuant to instructions to be included in the EMMA Dataport Manual, the underwriter would be required to review the collection of security specific information prepopulated by EMMA during the submission process to ensure that all such securities have properly been associated with the submission, and the underwriter would be obligated to add additional information (including but not limited to any relevant CUSIP numbers) not prepopulated by EMMA to the extent necessary to fully associate all applicable securities with the submission and to indicate that information for a security that has been prepopulated by EMMA should be removed because such security is not in fact associated with the submission.

As noted above, the MSRB expects that the requirement that all information to be supplied through Form G32 be accurately and completely submitted by the applicable deadlines, and particularly by the closing date, will be strictly enforced to promote the purposes of the revised Rule G32 and the protection of investors.

Use of Form G32 in Connection With Offerings and Issues. For purposes of submitting Form G32 under the proposal, an offering would consist of all securities described in the official statement, and the offering could consist of one or more issues.\31\ An issue
[[Page 15197]]
generally would consist of all securities in an offering having the same issuer, the same issue description (including same series designation or named obligor, if applicable) and the same dated date. In cases where no official statement is produced, each issue not described in an official statement would be considered a separate offering for purposes of Form G32.
\31\ As used in this context, an offering generally would correspond to the definition of a primary offering under revised Rule G32 and Exchange Act Rule 15c212. Multiple issues (including but not limited to separately designated series of an offering) on a single official statement would be treated as part of the same offering for purposes of Form G32 submissions even if issued by different issuers and/or underwritten by different underwriters. However, to the extent that a primary offering is offered through more than one official statement (e.g., separate official statements for separate issues within a single primary offering), offering level information to be provided through a Form G32 submission would relate solely to the portion of the primary offering described in the official statement that is the subject of the specific submission, and the remainder of the information related to such primary offering would be provided through a separate Form G32 submission for the other official statement.

Basic Submission Process for Form G32. The basic information to be provided through Form G32 and the timing of the submission of such information for a typical submission to EMMA under revised Rule G32 would be as set forth below. An underwriter would be responsible for providing all information described below to the extent so required for all maturities of any issue underwritten in whole or in part by such underwriter.\32\ In the case in which an underwriter does not underwrite any portion of one or more issues in an offering, the underwriter would be responsible for providing only the ninedigit CUSIP number for the latest maturity of any such nonunderwritten issue.\33\
\32\ For example, if an underwriter only underwrites two maturities of an issue consisting of ten maturities, the underwriter would be responsible for reporting information regarding all ten maturities in the issue. See also footnote 31 supra.
\33\ For example, if an offering consists of three issues, only two of which were underwritten in any part by a particular underwriter, such underwriter would be responsible for providing the full information required under Form G32 for the two issues it underwrites but would only be responsible for providing the nine digit CUSIP number for the latest maturity of the issue it does not underwrite. See also footnotes 31 and 32 supra.

Information on date of first execution of transaction. The underwriter would be required under revised Rule G32(b)(i)(A) and (b)(vi)(C)(1)(a) to initiate the Form G32 submission process by no later than the date of first execution of transactions in securities sold in the offering, at which time the underwriter would provide the following items of information with respect to each issue it underwrites:

Document and information at time of submission of official statement. The official statement would be required under revised Rule G32(b)(i)(B)(1) to be submitted to EMMA, along with related Form G32 information, within one business day after receipt from the issuer or its designated agent, but by no later than the closing date. The underwriter would be required to submit, along with or prior to the submission of the official statement, the following items with respect to each issue:

In the typical offering, the submission of the document to EMMA within one business day of receipt from the issuer would be preceded by the required initial submission of information on or prior to the date of first execution of a transaction in the securities. However, in those cases where the official statement submission deadline precedes the date of first execution (for example, if the underwriter has received the official statement in advance of the date of first execution), the underwriter would be required to submit, along with or prior to the submission of the official statement and the items of information identified above, the following additional items with respect to each issue (which otherwise would be required to be submitted by no later than the date of first execution): \39\ \39\ Other items normally required to be submitted by no later than the time of first execution would continue to be required by such deadline.

Summary of Basic Information Requirements. The items of information to be submitted and the timing of such submissions through Form G32 under revised Rule G32 for submissions not
[[Page 15198]]
requiring additional information (as described below) is summarized in the following table:
Item Timing Full issuer name/issue description.... Earlier of (i) date of first execution and (ii) date of official statement submission. 9digit CUSIP number.................. Earlier of (i) date of first execution and (ii) later of (a) officia