Skip to Content


Self-Regulatory Organizations; Order Granting Approval of a Proposed Rule Change by the Municipal Securities Rulemaking Board Relating to the Establishment of an Optional Procedure for Electronic Submission of Forms G-37/G-38 and G-37x Under Rule G-37, on Political Contributions and Prohibitions on Municipal Securities Business, and Rule G-38, on Consultants

Document Details

Information about this document as published in the Federal Register.

Published Document

This document has been published in the Federal Register. Use the PDF linked in the document sidebar for the official electronic format.

Start Preamble April 23, 2003.

On March 21, 2003, the Municipal Securities Rulemaking Board (“MSRB”) filed with the Securities & Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Exchange Act”) [1] , and Rule 19b-4 thereunder,[2] a proposed rule change (File No. SR-MSRB-2003-01). The MSRB's rule change amends Rule G-37, on political contributions and prohibitions on municipal securities business, and Rule G-38, on consultants, by establishing an optional procedure for electronic submission of Forms G-37/G-38 and G-37x.

The proposed rule change was published for notice and comment in the Federal Register on April 1, 2003.[3] The Commission did not receive comment letters on the proposed rule change. This order approves the proposed rule change.

I. Description of the Proposed Rule Change

Currently, Rules G-37 and G-38 require brokers, dealers and municipal securities dealers (“dealers”) to submit to the MSRB on Form G-37/G-38 certain information regarding political contributions to issuer officials, payments to state and local political parties, issuers with which the dealer has engaged in municipal securities business and consultants engaged by the dealer to obtain municipal securities business. Certain dealers that wish to be exempted from the Form G-37/G-38 submission requirement must submit Form G-37x to the MSRB.

Under the rule change, the MSRB is implementing an optional system of electronic submission by dealers of Forms G-37/G-38 and G-37x to the MSRB. In order to effectuate this electronic system, the MSRB is amending rules G-37 and G-38.[4] The rule change will become effective on the later of June 30, 2003 or 30 days after Commission approval. The MSRB expects that the new electronic submission system will become operational concurrently therewith.

II. Summary of Comments

The Commission did not receive comment letters relating to the proposed rule change. Start Printed Page 23171

III. Discussion and Commission Findings

Section 19(b) of the Exchange Act [5] requires the Commission to approve the proposed rule change filed by the MSRB if the Commission finds that the proposed rule change is consistent with the requirements of the Exchange Act and the rules and regulations thereunder.

The Commission has reviewed carefully the proposed rule change and finds that the proposed rule change is consistent with the requirements of the Exchange Act and the rules and regulations thereunder, which govern the MSRB.[6] The language of Section 15B(b)(2)(C) of the Act requires that the MSRB's rules must be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principals of trade, to foster cooperation and coordination with persons engaged in regulating, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market in municipal securities, and, in general, to protect investors and the public interest.[7] The rule change is consistent with the Exchange Act in that it amends an existing MSRB rule to allow for an alternative efficient process of submitting required information by dealers to the MSRB.

IV. Conclusion

It is therefore ordered, pursuant to section 19(b)(2) of the Exchange Act,[8] that the proposed rule change (File No. SR-MSRB-2003-01) be and hereby is, approved.

Start Signature

For the Commission by the Division of Market Regulation, pursuant to delegated authority.[9]

J. Lynn Taylor,

Assistant Secretary.

End Signature End Preamble


3.  See Release No. 34-47565 (Mar. 25, 2003), 68 FR 15782.

Back to Citation

4.  Technical amendments to the final sentence of Rule G-38(e) and to Rule G-38(e)(iii) are also made to conform language to usage throughout MSRB rules.

Back to Citation

6.  Additionally, in approving this rule, the Commission notes that it has considered the proposed rule's impact on efficiency, competition and capital formation. 15 U.S.C. 78c(f).

Back to Citation

[FR Doc. 03-10602 Filed 4-29-03; 8:45 am]