Self-Regulatory Organizations; Municipal Securities Rulemaking Board; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Consisting of Amendments to MSRB Rule A-16, on Examination Fees, 16485-16487 [2015-06990]

Download as PDF Federal Register / Vol. 80, No. 59 / Friday, March 27, 2015 / Notices 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. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– NYSEArca–2015–15 on the subject line. Paper Comments mstockstill on DSK4VPTVN1PROD with NOTICES • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–NYSEArca–2015–15. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, 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 Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such filing will also be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR– NYSEArca–2015–15 and should be submitted on or before April 17, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.49 Brent J. Fields, Secretary. [FR Doc. 2015–06991 Filed 3–26–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–74561; File No. SR–MSRB– 2015–01] Self-Regulatory Organizations; Municipal Securities Rulemaking Board; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Consisting of Amendments to MSRB Rule A–16, on Examination Fees March 23, 2015. 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 March 17, 2015, the Municipal Securities Rulemaking Board (the ‘‘MSRB’’ or ‘‘Board’’) filed with the Securities and Exchange Commission (the ‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the MSRB. 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 MSRB filed with the Commission a proposed rule change consisting of amendments to MSRB Rule A–16, on examination fees (‘‘proposed rule change’’). The MSRB designated the proposed rule change as ‘‘establishing or changing a due, fee or other charge’’ under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b–4(f)(2) 4 thereunder, which renders the proposal effective upon filing with the Commission. The implementation date of the proposed rule change is April 1, 2015. The text of the proposed rule change is available on the MSRB’s Web site at https://www.msrb.org/Rules-andInterpretations/SEC-Filings/2015Filings.aspx, at the MSRB’s principal office, and at the Commission’s Public Reference Room. 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(ii). 4 17 CFR 240.19b–4(f)(2). 2 17 49 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 20:59 Mar 26, 2015 Jkt 235001 PO 00000 Frm 00127 Fmt 4703 Sfmt 4703 16485 II. Self-Regulatory 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. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of the proposed rule change is to establish a test development fee for the MSRB’s new municipal advisor representative qualification examination (‘‘Series 50 examination’’) and to better align the MSRB’s existing test development fees (which have not been adjusted since 2009) with the costs of developing, implementing and maintaining the tests (hereinafter, the ‘‘program costs’’). Under the proposed rule change, the MSRB will institute a test development fee of $150 for the Series 50 examination and change the test development fee for each of the three existing MSRB-owned examinations from $60 to $150. The development fee of $150 will, on April 1, 2015, be assessed on brokers, dealers and municipal securities dealers (‘‘dealers’’) and municipal advisors based on the number of their associated persons that take an MSRB-owned professional qualification examination. Any person associated with a dealer who is engaged in or supervises municipal securities activities and any person associated with a municipal advisor who is engaged in or supervises municipal advisory activities must be qualified in accordance with MSRB Rule G–3.5 As a prerequisite to qualification, each individual must pass the applicable examination to demonstrate a basic competence in the subject matter related to the professional qualification classification. The 5 The SEC recently approved MSRB rule amendments, effective April 27, 2015, that establish professional qualification standards for municipal advisors. The amendments to MSRB Rule G–3 establish two professional qualification classifications for municipal advisors—municipal advisor representative and municipal advisor principal. See Exchange Act Release No. 74384 (Feb. 26, 2015), 80 FR 11706 (Mar. 4, 2015), File No. SR–MSRB–2014–08 (Nov. 18, 2014). E:\FR\FM\27MRN1.SGM 27MRN1 mstockstill on DSK4VPTVN1PROD with NOTICES 16486 Federal Register / Vol. 80, No. 59 / Friday, March 27, 2015 / Notices examinations seek to measure accurately and reliably the degree to which each candidate possesses the knowledge, skills and abilities necessary to perform the relevant job function. The examinations measure a candidate’s knowledge of business activities, as well as the regulatory requirements, including MSRB rules, rule interpretations and other federal law applicable to a particular classification. Generally, the MSRB recognizes two types of professional qualification examinations: MSRB-owned examinations and examinations owned by the Financial Industry Regulatory Authority (‘‘FINRA’’). There are three existing MSRB-owned examinations and one in development. The Municipal Fund Securities Limited Principal Qualification Examination (‘‘Series 51 examination’’), Municipal Securities Representative Qualification Examination (‘‘Series 52 examination’’), and Municipal Securities Principal Qualification Examination (‘‘Series 53 examination’’) are developed, implemented, maintained, and owned by the MSRB. The Series 50 examination, which is under development for municipal advisor representatives, is also owned by the MSRB. Each of the existing MSRBowned examinations is administered by FINRA, and it is expected that FINRA also will administer the Series 50 examination. MSRB-owned professional qualification examinations are developed by the MSRB in conjunction with industry-wide advisory committees and retained test design experts in accordance with established national standards. The test development fee assessed under Rule A–16 is intended to partially offset the program costs. Pursuant to the proposed rule change, the MSRB will change the test development fee from $60 to $150 for the Series 51 examination, Series 52 examination and Series 53 examination. This is the first time the MSRB has adjusted its examination development fees since 2009 when the fees were first established under MSRB Rule A–16.6 The MSRB is amending Rule A–16 to better align the fees with the current program costs because the MSRB’s current examination fees, as a percentage of the program costs, have decreased significantly since the fees were established in 2009. The examination development fees have not previously been, and are not intended to fully offset the program costs, but to 6 See Exchange Act Release No. 61023 (Nov. 18, 2009), 74 FR 61402 (Nov. 24, 2009), File No. SR– MSRB–2009–16 (Nov. 5, 2009). VerDate Sep<11>2014 20:59 Mar 26, 2015 Jkt 235001 help defray a portion of the cost of developing and implementing the examinations, as well as the costs associated with monitoring the examinations for effectiveness and updating the examinations’ content and questions. To address the growing disparity between the examination fees collected and the program costs, the MSRB is changing the examination fee to $150 for each MSRB-owned examination. The MSRB believes this fee adjustment is reasonable and appropriate. The proposed rule change also amends Rule A–16 to clarify that the examination fee is assessed to dealers and municipal advisors, rather than their associated persons who take the professional qualification tests. In addition to the MSRB’s examination fee, FINRA assesses an administrative fee for each examination that it administers. These fees are assessed by FINRA at the time a broker, dealer, municipal securities dealer or municipal advisor enrolls an associated person to take an examination and then FINRA remits the aggregate MSRB examination fees to the MSRB periodically. 2. Statutory Basis The MSRB believes that the proposed rule change is consistent with the requirements of Section 15B(b)(2)(J) of the Act,7 which requires, in pertinent part, that the MSRB promulgate rules to require dealers and municipal advisors to pay such reasonable fees and charges as may be necessary or appropriate to defray the costs and expenses of operating and administering the MSRB. The proposed rule change provides for reasonable fees to partially defray the program costs. B. Self-Regulatory Organization’s Statement on Burden on Competition Section 15B(b)(2)(C) of the Act 8 requires that MSRB rules not be designed to impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. In addition, Section 15B(b)(2)(L)(iv) of the Act requires that MSRB rules not impose a regulatory burden on small municipal advisors that is not necessary or appropriate in the public interest and for the protection of investors, municipal entities, and obligated persons provided that there is robust protection of investors against fraud.9 In considering these standards, the MSRB was guided by the Board’s Policy 7 15 U.S.C. 78o–4(b)(2)(J). U.S.C. 78o–4(b)(2)(C). 9 15 U.S.C. 78o–4(b)(2)(L)(iv). 8 15 PO 00000 Frm 00128 Fmt 4703 Sfmt 4703 on the Use of Economic Analysis. The MSRB does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The MSRB considered as alternatives whether to maintain the current fee, or to propose an increase that was lower or higher than the proposed increase. Since the current examination fees were instituted, the costs relating to the development, implementation and maintenance of the examinations have increased. The examination fees have, as noted, remained unchanged since 2009 and the proposed rule change is designed to better align the fees with the current program costs. The revenue from such fees will still fall well-short of the actual program costs. Finally, the examination fees are equitable to each dealer and municipal advisor without regard to the nature of that entity’s business and are assessed only as to those individuals who are associated with the entity who enroll to take an MSRB-owned qualification examination. To evaluate the impact of the adjustment in the MSRB test development fees for the Series 51, 52, and 53 examinations and the establishment of a development fee of $150 for the Series 50 examination, the MSRB considered the fees charged to take other professional qualification examinations in the financial services field. When including the administrative fee assessed by FINRA, the total fee that will be charged to take any MSRB-owned examination is comparable to the total fee charged to take other FINRA-administered professional qualification examinations, which currently range from $70–$335.10 As another example, in the financial services field, the fee to take the Chartered Financial Analyst Level I examination is $630. In addition, the MSRB considered the fees charged to take professional qualification examinations in other fields. The average state bar examination fee as of 2013 was approximately $490.11 Note that nearly 10 See FINRA Administered Qualification Examinations www.finra.org/industry/compliance/ registration/qualificationsexams/qualifications/ p011096. Effective April 1, 2015, the total fee charged to take other FINRA-administered professional qualification examinations will range from $75–$350. See File No. SR–FINRA–2015–006. 11 See American Bar Association Bar Exam Directory, www.americanbar.org/publications/ student_lawyer/2012-13/nov/2012_2013_bar_exam_ directory.html. The cost of examinations varies substantially from state to state, as does whether the fee includes other professional certification costs (e.g., moral character reviews). E:\FR\FM\27MRN1.SGM 27MRN1 mstockstill on DSK4VPTVN1PROD with NOTICES Federal Register / Vol. 80, No. 59 / Friday, March 27, 2015 / Notices 50 percent of the attorneys who were in private practice that year, were sole practitioners and an additional 14 percent work in firms made up of five or fewer attorneys.12 As another example, the Project Management Professional examination fee is $250. The MSRB is not aware of evidence that the fees associated with other examinations represent a significant burden on smaller firms or that they negatively impact the competitiveness of the associated professional services markets. While the MSRB recognizes that examination fees do represent an initial barrier to entry in markets where they are required, the MSRB also recognizes that professionals wishing to engage in municipal securities activities and/or municipal advisory activities face other costs associated with complying with applicable laws and regulations. The fees for professional qualification examinations, which are one-time fees for those who pass, typically represent a relatively small share of all legal and compliance costs associated with a government-regulated activity. The MSRB anticipates that potential market entrants that are actually deterred by a professional examination fee would find it difficult to bear the costs to fully comply with the other regulatory and legal requirements associated with the market in which they wish to offer services. With regard to the impact on small municipal advisors, the MSRB notes that because the total fee assessed to a firm is based on the number of individuals associated with that firm who enroll to take an MSRB-owned qualification examination, the total costs assessed will bear a reasonable relationship to the size of the firm, with smaller firms likely to be assessed lower fee totals. Nonetheless, larger, more diversified firms may have a larger overall revenue base than smaller firms and may be more able to pass expenses on to clients than smaller firms. On net, the MSRB believes that the burdens associated with the proposed rule change on small municipal advisors are limited and that, as the SEC concluded in its final rule on the permanent registration of municipal advisors, the market would be likely to remain competitive despite the potential exit of some municipal advisors (including small entity municipal advisors), consolidation of municipal advisors, or 12 See American Bar Association Bar Lawyer Demographics, https://www.americanbar.org/ content/dam/aba/administrative/market_research/ lawyer_demographics_2013.authcheckdam.pdf. VerDate Sep<11>2014 20:59 Mar 26, 2015 Jkt 235001 lack of new entrants into the market.13 The MSRB also believes that its professional qualification examinations promote compliance with applicable laws and regulations are necessary for the protection of investors, municipal entities, and obligated persons. Therefore, the MSRB believes the proposed rule change does not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. 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 on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The forgoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 14 and paragraph (f) of Rule 19b–4 15 thereunder. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such 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. Comments may be submitted by any of the following methods: 16487 comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://www.sec.gov/ rules/sro.shtml).Copies of the submission, 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 Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549 on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the MSRB. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–MSRB– 2015–01 and should be submitted on or before April 17, 2015. For the Commission, pursuant to delegated authority.16 Brent J. Fields, Secretary. [FR Doc. 2015–06990 Filed 3–26–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Electronic Comments • Use the Commission’s Internet comment form https://www.sec.gov/ rules/sro.shtml; or • Send an email to rule-comments@ sec.gov. Please include File Number SR– MSRB–2015–01 on the subject line. [Investment Company Act Release No. 31509; File No. 812–14373] Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549. All submissions should refer to File Number SR–MSRB–2015–01. This file number should be included on the subject line if email is used. To help the Commission process and review your AGENCY: 13See Registration of Municipal Advisors, Exchange Act Release No. 70462 (Sept. 20, 2013), 78 FR 67467 (Nov. 12, 2013). 14 15 U.S.C. 78s(b)(3)(A). 15 17 CFR 240.19b–4(f). PO 00000 Frm 00129 Fmt 4703 Sfmt 4703 Griffin Institutional Access Real Estate Fund and Griffin Capital Advisor, LLC; Notice of Application March 23, 2015. Securities and Exchange Commission (‘‘Commission’’). ACTION: Notice of an application under section 6(c) of the Investment Company Act of 1940 (the ‘‘Act’’) for an exemption from sections 18(c) and 18(i) of the Act, under sections 6(c) and 23(c)(3) of the Act for an exemption from rule 23c–3 under the Act, and for an order pursuant to section 17(d) of the Act and rule 17d–1 under the Act. Summary of Application: Applicants request an order to permit SUMMARY: 16 17 E:\FR\FM\27MRN1.SGM CFR 200.30–3(a)(12). 27MRN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 80, Number 59 (Friday, March 27, 2015)]
[Notices]
[Pages 16485-16487]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-06990]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74561; File No. SR-MSRB-2015-01]

Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Notice of Filing and Immediate Effectiveness of a Proposed Rule
Change Consisting of Amendments to MSRB Rule A-16, on Examination Fees

March 23, 2015.
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 March 17, 2015, the Municipal Securities Rulemaking Board (the
``MSRB'' or ``Board'') filed with the Securities and Exchange
Commission (the ``SEC'' or ``Commission'') the proposed rule change as
described in Items I, II, and III below, which Items have been 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 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

The MSRB filed with the Commission a proposed rule change
consisting of amendments to MSRB Rule A-16, on examination fees
(``proposed rule change''). The MSRB designated the proposed rule
change as ``establishing or changing a due, fee or other charge'' under
Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) \4\
thereunder, which renders the proposal effective upon filing with the
Commission. The implementation date of the proposed rule change is
April 1, 2015.
---------------------------------------------------------------------------

\3\ 15 U.S.C. 78s(b)(3)(A)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

The text of the proposed rule change is available on the MSRB's Web
site at https://www.msrb.org/Rules-and-Interpretations/SEC-Filings/2015-Filings.aspx, at the MSRB's principal office, and at the Commission's
Public Reference Room.

II. Self-Regulatory 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. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
The purpose of the proposed rule change is to establish a test
development fee for the MSRB's new municipal advisor representative
qualification examination (``Series 50 examination'') and to better
align the MSRB's existing test development fees (which have not been
adjusted since 2009) with the costs of developing, implementing and
maintaining the tests (hereinafter, the ``program costs''). Under the
proposed rule change, the MSRB will institute a test development fee of
$150 for the Series 50 examination and change the test development fee
for each of the three existing MSRB-owned examinations from $60 to
$150. The development fee of $150 will, on April 1, 2015, be assessed
on brokers, dealers and municipal securities dealers (``dealers'') and
municipal advisors based on the number of their associated persons that
take an MSRB-owned professional qualification examination.
Any person associated with a dealer who is engaged in or supervises
municipal securities activities and any person associated with a
municipal advisor who is engaged in or supervises municipal advisory
activities must be qualified in accordance with MSRB Rule G-3.\5\ As a
prerequisite to qualification, each individual must pass the applicable
examination to demonstrate a basic competence in the subject matter
related to the professional qualification classification. The

[[Page 16486]]

examinations seek to measure accurately and reliably the degree to
which each candidate possesses the knowledge, skills and abilities
necessary to perform the relevant job function. The examinations
measure a candidate's knowledge of business activities, as well as the
regulatory requirements, including MSRB rules, rule interpretations and
other federal law applicable to a particular classification.
---------------------------------------------------------------------------

\5\ The SEC recently approved MSRB rule amendments, effective
April 27, 2015, that establish professional qualification standards
for municipal advisors. The amendments to MSRB Rule G-3 establish
two professional qualification classifications for municipal
advisors--municipal advisor representative and municipal advisor
principal. See Exchange Act Release No. 74384 (Feb. 26, 2015), 80 FR
11706 (Mar. 4, 2015), File No. SR-MSRB-2014-08 (Nov. 18, 2014).
---------------------------------------------------------------------------

Generally, the MSRB recognizes two types of professional
qualification examinations: MSRB-owned examinations and examinations
owned by the Financial Industry Regulatory Authority (``FINRA''). There
are three existing MSRB-owned examinations and one in development. The
Municipal Fund Securities Limited Principal Qualification Examination
(``Series 51 examination''), Municipal Securities Representative
Qualification Examination (``Series 52 examination''), and Municipal
Securities Principal Qualification Examination (``Series 53
examination'') are developed, implemented, maintained, and owned by the
MSRB. The Series 50 examination, which is under development for
municipal advisor representatives, is also owned by the MSRB. Each of
the existing MSRB-owned examinations is administered by FINRA, and it
is expected that FINRA also will administer the Series 50 examination.
MSRB-owned professional qualification examinations are developed by
the MSRB in conjunction with industry-wide advisory committees and
retained test design experts in accordance with established national
standards. The test development fee assessed under Rule A-16 is
intended to partially offset the program costs. Pursuant to the
proposed rule change, the MSRB will change the test development fee
from $60 to $150 for the Series 51 examination, Series 52 examination
and Series 53 examination. This is the first time the MSRB has adjusted
its examination development fees since 2009 when the fees were first
established under MSRB Rule A-16.\6\
---------------------------------------------------------------------------

\6\ See Exchange Act Release No. 61023 (Nov. 18, 2009), 74 FR
61402 (Nov. 24, 2009), File No. SR-MSRB-2009-16 (Nov. 5, 2009).
---------------------------------------------------------------------------

The MSRB is amending Rule A-16 to better align the fees with the
current program costs because the MSRB's current examination fees, as a
percentage of the program costs, have decreased significantly since the
fees were established in 2009. The examination development fees have
not previously been, and are not intended to fully offset the program
costs, but to help defray a portion of the cost of developing and
implementing the examinations, as well as the costs associated with
monitoring the examinations for effectiveness and updating the
examinations' content and questions. To address the growing disparity
between the examination fees collected and the program costs, the MSRB
is changing the examination fee to $150 for each MSRB-owned
examination. The MSRB believes this fee adjustment is reasonable and
appropriate.
The proposed rule change also amends Rule A-16 to clarify that the
examination fee is assessed to dealers and municipal advisors, rather
than their associated persons who take the professional qualification
tests. In addition to the MSRB's examination fee, FINRA assesses an
administrative fee for each examination that it administers. These fees
are assessed by FINRA at the time a broker, dealer, municipal
securities dealer or municipal advisor enrolls an associated person to
take an examination and then FINRA remits the aggregate MSRB
examination fees to the MSRB periodically.
2. Statutory Basis
The MSRB believes that the proposed rule change is consistent with
the requirements of Section 15B(b)(2)(J) of the Act,\7\ which requires,
in pertinent part, that the MSRB promulgate rules to require dealers
and municipal advisors to pay such reasonable fees and charges as may
be necessary or appropriate to defray the costs and expenses of
operating and administering the MSRB. The proposed rule change provides
for reasonable fees to partially defray the program costs.
---------------------------------------------------------------------------

\7\ 15 U.S.C. 78o-4(b)(2)(J).
---------------------------------------------------------------------------

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

Section 15B(b)(2)(C) of the Act \8\ requires that MSRB rules not be
designed to impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act. In addition,
Section 15B(b)(2)(L)(iv) of the Act requires that MSRB rules not impose
a regulatory burden on small municipal advisors that is not necessary
or appropriate in the public interest and for the protection of
investors, municipal entities, and obligated persons provided that
there is robust protection of investors against fraud.\9\
---------------------------------------------------------------------------

\8\ 15 U.S.C. 78o-4(b)(2)(C).
\9\ 15 U.S.C. 78o-4(b)(2)(L)(iv).
---------------------------------------------------------------------------

In considering these standards, the MSRB was guided by the Board's
Policy on the Use of Economic Analysis. The MSRB does not believe that
the proposed rule change will impose any burden on competition that is
not necessary or appropriate in furtherance of the purposes of the Act.
The MSRB considered as alternatives whether to maintain the current
fee, or to propose an increase that was lower or higher than the
proposed increase. Since the current examination fees were instituted,
the costs relating to the development, implementation and maintenance
of the examinations have increased. The examination fees have, as
noted, remained unchanged since 2009 and the proposed rule change is
designed to better align the fees with the current program costs. The
revenue from such fees will still fall well-short of the actual program
costs. Finally, the examination fees are equitable to each dealer and
municipal advisor without regard to the nature of that entity's
business and are assessed only as to those individuals who are
associated with the entity who enroll to take an MSRB-owned
qualification examination.
To evaluate the impact of the adjustment in the MSRB test
development fees for the Series 51, 52, and 53 examinations and the
establishment of a development fee of $150 for the Series 50
examination, the MSRB considered the fees charged to take other
professional qualification examinations in the financial services
field. When including the administrative fee assessed by FINRA, the
total fee that will be charged to take any MSRB-owned examination is
comparable to the total fee charged to take other FINRA-administered
professional qualification examinations, which currently range from
$70-$335.\10\ As another example, in the financial services field, the
fee to take the Chartered Financial Analyst Level I examination is
$630.
---------------------------------------------------------------------------

\10\ See FINRA Administered Qualification Examinations
www.finra.org/industry/compliance/registration/qualificationsexams/qualifications/p011096. Effective April 1, 2015, the total fee
charged to take other FINRA-administered professional qualification
examinations will range from $75-$350. See File No. SR-FINRA-2015-
006.
---------------------------------------------------------------------------

In addition, the MSRB considered the fees charged to take
professional qualification examinations in other fields. The average
state bar examination fee as of 2013 was approximately $490.\11\ Note
that nearly

[[Page 16487]]

50 percent of the attorneys who were in private practice that year,
were sole practitioners and an additional 14 percent work in firms made
up of five or fewer attorneys.\12\ As another example, the Project
Management Professional examination fee is $250. The MSRB is not aware
of evidence that the fees associated with other examinations represent
a significant burden on smaller firms or that they negatively impact
the competitiveness of the associated professional services markets.
---------------------------------------------------------------------------

\11\ See American Bar Association Bar Exam Directory,
www.americanbar.org/publications/student_lawyer/2012-13/nov/2012_2013_bar_exam_directory.html. The cost of examinations varies
substantially from state to state, as does whether the fee includes
other professional certification costs (e.g., moral character
reviews).
\12\ See American Bar Association Bar Lawyer Demographics,
https://www.americanbar.org/content/dam/aba/administrative/market_research/lawyer_demographics_2013.authcheckdam.pdf.
---------------------------------------------------------------------------

While the MSRB recognizes that examination fees do represent an
initial barrier to entry in markets where they are required, the MSRB
also recognizes that professionals wishing to engage in municipal
securities activities and/or municipal advisory activities face other
costs associated with complying with applicable laws and regulations.
The fees for professional qualification examinations, which are one-
time fees for those who pass, typically represent a relatively small
share of all legal and compliance costs associated with a government-
regulated activity. The MSRB anticipates that potential market entrants
that are actually deterred by a professional examination fee would find
it difficult to bear the costs to fully comply with the other
regulatory and legal requirements associated with the market in which
they wish to offer services.
With regard to the impact on small municipal advisors, the MSRB
notes that because the total fee assessed to a firm is based on the
number of individuals associated with that firm who enroll to take an
MSRB-owned qualification examination, the total costs assessed will
bear a reasonable relationship to the size of the firm, with smaller
firms likely to be assessed lower fee totals. Nonetheless, larger, more
diversified firms may have a larger overall revenue base than smaller
firms and may be more able to pass expenses on to clients than smaller
firms. On net, the MSRB believes that the burdens associated with the
proposed rule change on small municipal advisors are limited and that,
as the SEC concluded in its final rule on the permanent registration of
municipal advisors, the market would be likely to remain competitive
despite the potential exit of some municipal advisors (including small
entity municipal advisors), consolidation of municipal advisors, or
lack of new entrants into the market.\13\ The MSRB also believes that
its professional qualification examinations promote compliance with
applicable laws and regulations are necessary for the protection of
investors, municipal entities, and obligated persons.
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\13\See Registration of Municipal Advisors, Exchange Act Release
No. 70462 (Sept. 20, 2013), 78 FR 67467 (Nov. 12, 2013).
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Therefore, the MSRB believes the proposed rule change does not
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.

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 on the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

The forgoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \14\ and paragraph (f) of Rule 19b-4 \15\
thereunder. At any time within 60 days of the filing of the proposed
rule change, the Commission summarily may temporarily suspend such 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.
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f).
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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. Comments may be submitted by any of
the following methods:

Electronic Comments

Use the Commission's Internet comment form https://www.sec.gov/rules/sro.shtml; or
Send an email to rule-comments@sec.gov. Please include
File Number SR-MSRB-2015-01 on the subject line.

Paper Comments

Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549.

All submissions should refer to File Number SR-MSRB-2015-01. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml).Copies of the submission, 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 Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549 on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the MSRB. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-MSRB-2015-01 and should be
submitted on or before April 17, 2015.
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\16\ 17 CFR 200.30-3(a)(12).

For the Commission, pursuant to delegated authority.\16\
Brent J. Fields,
Secretary.
[FR Doc. 2015-06990 Filed 3-26-15; 8:45 am]
BILLING CODE 8011-01-P

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