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Notice

Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by the Municipal Securities Rulemaking Board Relating to Electronic Mail Contacts, Operative on September 8, 2002

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Start Preamble August 8, 2002.

Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”) [1] and Rule 19b-4 thereunder,[2] notice is hereby given that on August 7, 2002, the Municipal Securities Rulemaking Board (“Board” or “MSRB”) filed with the Securities and Exchange Commission (“Commission” or “SEC”) a proposed rule change (File No. SR-MSRB-2002-08). The proposed rule change is described in Items I, II, and III below, which Items have been prepared by the Board. 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 herewith a proposed rule change relating to a technical amendment to its Rule G-40 and Form G-40, on electronic mail contacts. The proposed rule change will become operative on September 8, 2002. Below is the text of the proposed rule Start Printed Page 53371change. Proposed new language is italicized; proposed deletions are in brackets.

Rule G-40. Electronic Mail Contacts.

(a) (i) Each broker, dealer or municipal securities dealer shall appoint a[n] Primary Electronic Mail Contact to serve as the official contact person for purposes of electronic mail communication between the broker, dealer or municipal securities dealer and the MSRB. Each Primary Electronic Mail Contact shall be a registered municipal securities principal of the broker, dealer or municipal securities dealer.

(ii) Each broker, dealer or municipal securities dealer may appoint an Optional Electronic Mail Contact for purposes of electronic mail communication between the broker, dealer or municipal securities dealer and the MSRB.

(b)(i) Upon completion of its Rule A-12 submissions and assignment of an MSRB Registration Number, each broker, dealer or municipal securities dealer shall submit to the MSRB by mail a completed Form G-40 setting forth, in the prescribed format, the following information:

(A) The name of the broker, dealer or municipal securities dealer, and the date.

(B) The MSRB Registration Number of the broker, dealer or municipal securities dealer.

(C) The name of the Primary Electronic Mail Contact, and his/her electronic mail address, telephone number and Individual Central Registration Depository (CRD) Number.

(D) The name of the Optional Electronic Mail Contact, if any, and his/her electronic mail address and telephone number.

(E) The name, title, signature and telephone number of the person who prepared the form.

(ii) A broker, dealer or municipal securities dealer may change the name of its Electronic Mail Contact s or other information previously provided by electronically submitting to the MSRB an amended Form G-40.

(c) Each broker, dealer or municipal securities dealer shall update information on its Electronic Mail Contacts periodically as requested and prescribed by the MSRB and shall submit such information electronically to the MSRB.

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II. Self-Regulatory Organization's Statement of the Terms of Substance of 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 texts 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

(a) On June 6, 2002, the Commission approved new MSRB Rule G-40, on electronic mail (“e-mail”) contacts, and new Form G-40, as well as related amendments to Rule G-8, on books and records, and Rule G-9, on preservation of records.[3] The new Rule requires each broker, dealer and municipal securities dealer (collectively referred to as “dealers”) to use new Form G-40 to appoint an e-mail contact to serve as the official contact person for purposes of electronic communication between the dealer and the MSRB. This E-mail contact must be a registered municipal securities principal with the dealer. Dealers have the option of appointing a second contact who, under the rule as originally adopted, also must be a municipal securities principal with the dealer.

The MSRB recently sent letters to its current list of dealers requesting that they complete new Form G-40. In response to this mailing, the MSRB received numerous phone calls from dealers that have only one municipal securities principal and wish to appoint a second (optional) e-mail contact who is not a principal. Accordingly, the MSRB has determined to amend Rule G-40 and Form G-40 to accommodate these dealers by eliminating the requirement that the second contact must be a municipal securities principal. The amendment also distinguishes between the two e-mail contacts by referring to the official contact person as the “Primary Contact” and the secondary person as the “Optional Contact.” [4]

(b) The MSRB has adopted the proposed rule change pursuant to Section 15B(b)(2)(I) of the Act, which authorizes the MSRB to adopt rules that provide for the operation and administration of the MSRB. The MSRB also believes that the proposed rule change will facilitate effective electronic communications between dealers and the MSRB.

B. Self-Regulatory Organization's Statement on Burden on Competition

The MSRB 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 since it would apply equally to all brokers, dealers and municipal securities dealers.

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

Because the foregoing proposed rule change: (i) Does not significantly affect the protection of investors or the public interest; (ii) does not impose any significant burden on competition; (iii) was provided to the SEC for its review at least five business days prior to the filing date; and (iv) does not become operative until September 8, 2002, which is more than thirty (30) days after the date of its filing, the MSRB has submitted this proposed rule change to become effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-4(f)(6) thereunder.[5] In particular, the MSRB believes the proposed rule change qualifies as a “non-controversial filing” in that the proposed rule change does not significantly affect the protection of investors or the public interest and does not impose any significant burden on competition. At any time within 60 days of the filing of this proposed rule change, the Commission may summarily abrogate this 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, including whether the proposed rule change is consistent with the Act. Persons making written submissions should file six copies thereof with the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. Copies of the submissions, 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 Board's offices. All submissions should refer to File No. SR-MSRB-2002-08 and should be submitted by September 5, 2002.

Start Signature

For the Commission by the Division of Market Regulation, pursuant to delegated Authority.[6]

Margaret H. McFarland,

Deputy Secretary.

End Signature End Preamble

Footnotes

3.  Release No. 34-46043 (June 6, 2002) 67 FR 40762. The effective date of the Rule is September 4, 2002. The MSRB requested a 90-day delayed effective date in order to give current dealers the time necessary to comply with the new requirements.

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4.  Paragraph (a) of Rule G-40 requires that each dealer appoint an “Electronic Mail Contact” to serve as its official contact person for purposes of communicating with the MSRB, and that such person be a registered municipal securities principal of the dealer. Paragraph (b) requires that each dealer, upon completion of its Rule A-12 submissions and assignment of an MSRB Registration Number, submit by mail to the MSRB a completed Form G-40 setting forth the dealer's name, date, MSRB Registration Number, name of its E-mail contact and his/her e-mail address, telephone number and Individual Central Registration Depository (CRD) Number, and the name, title, signature and telephone number of the person who prepared the Form. Paragraph (b) also provides that the dealer may change its E-mail contact or other information previously submitted by amending its Form G-40 electronically. Paragraph (c) requires each dealer to update information on its E-mail contacts as periodically requested and prescribed by the MSRB and to submit such information electronically to the MSRB.

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5.  15 U.S.C. 78s(b)(3)(A); 17 CFR 240.19b-4(f)(6).

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BILLING CODE 8010-01-P

BILLING CODE 8010-01-C

[FR Doc. 02-20766 Filed 8-14-02; 8:45 am]

BILLING CODE 8010-01-P