The SEC1 and the Municipal Securities Rulemaking Board (MSRB) have withdrawn several proposals relating to municipal advisors.2 The withdrawals followed objections raised by industry groups concerning the futility of commenting on proposals without understanding which parties would be subject to them. The MSRB stated that its intention is to resubmit the proposals upon the adoption by the SEC of a final definition of “municipal advisor.” Despite these actions, SEC Commissioner Walters advised a conference of market participants that the final municipal advisory registration scheme is “very much on the front burner” and that market participants who want to prepare for the final rule should study the MSRB’s recent municipal advisor rule filings, including the proposals that recently were withdrawn.3
The withdrawn proposals include:
The withdrawn proposals have no effect on:
The withdrawn proposals also have no effect on proposed MSRB Rules G-21 (relating to advertising) and G-46 (relating to written engagements and certain disclosures). These proposed Rules remain open for comment.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) required the SEC to establish a permanent registration regime for municipal advisors and imposed certain recordkeeping requirements and fiduciary duties upon certain municipal advisors. The SEC issued proposed rules (Proposed Rules),4 which were the subject of a prior Katten Client Advisory and included a proposed definition of “municipal advisor,” and established a temporary registration system and certain recordkeeping requirements for municipal advisors. Comments on the Proposed Rules were due on February 22, 2011, but the SEC continues to receive comments.
1 See Securities Exchange Act Release No. 65394 (September 30, 2011), 76 FR 60952; Securities Exchange Act Release No. 65395 (September 30, 2011), 76 FR 60954; Securities Exchange Act Release No. 65396 (September 30, 2011), 76 FR 60959; Securities Exchange Act Release No. 65397 (September 30, 2011), 76 FR 60955; and Securities Exchange Act Release No. 65398 (September 30, 2011), 76 FR 60958.
2 See MSRB Notice 2011-51 (September 12, 2011).
3 “SEC Muni Report Advances,” The Bond Buyer, September 28, 2011, page 1, at page 20.
4 The Proposed Rules were published in the Federal Register, Volume 76, No. 4 (January 6, 2011) as Release No. 34-63576, available here.