Self-Regulatory Organizations; Municipal Securities Rulemaking Board; Notice of Filing of a Proposed Rule Change Consisting of Revisions to the Content Outlines for the Municipal Fund Securities Limited Principal Qualification Examination, Municipal Securities Representative Qualification Examination and Municipal Securities Principal Qualification Examination and Revisions to the Selection Specifications for the Municipal Securities Principal Qualification Examination, 48572-48577 [2015-19874]
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Federal Register / Vol. 80, No. 156 / Thursday, August 13, 2015 / Notices
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[Release No. 34–75646; File No. SR–MSRB–
2015–07]
Self-Regulatory Organizations;
Municipal Securities Rulemaking
Board; Notice of Filing of a Proposed
Rule Change Consisting of Revisions
to the Content Outlines for the
Municipal Fund Securities Limited
Principal Qualification Examination,
Municipal Securities Representative
Qualification Examination and
Municipal Securities Principal
Qualification Examination and
Revisions to the Selection
Specifications for the Municipal
Securities Principal Qualification
Examination
August 7, 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 July 31,
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
proposed revisions to the content
outlines for the Municipal Fund
Securities Limited Principal
1 15
2 17
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
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Qualification Examination (Series 51),
Municipal Securities Representative
Qualification Examination (Series 52)
and Municipal Securities Principal
Qualification Examination (Series 53).
As a result of changes to MSRB rules,
revisions to the content outlines are
necessary to more accurately indicate
the current rule requirements and rule
citations. Additionally, the MSRB is
proposing revisions to the selection
specifications for the Series 53
qualification examination (collectively,
the ‘‘proposed rule change’’).3 The
MSRB is not proposing any textual
changes to its rules.
The text of the proposed rule change
is available on the MSRB’s Web site at
www.msrb.org/Rules-andInterpretations/SEC-Filings/2015Filings.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
Section 15B(b)(2)(A) of the Act 4
authorizes the MSRB to prescribe for
municipal securities brokers or
municipal securities dealers and their
associated persons standards of training,
experience, competence, and such other
qualifications as the Board finds
necessary or appropriate in the public
3 The MSRB is also proposing changes to the
question banks for the Series 51, Series 52 and
Series 53 examinations, but based upon instructions
from the Commission staff, the MSRB is submitting
SR–MSRB–2015–07 for immediate effectiveness
pursuant to Section 19(b)(3)(A)(i) of the Act and
Rule 19b–4(f)(6) thereunder, and is not filing the
question banks for Commission review. See letter to
Diane G. Klinke, General Counsel, MSRB, from
Belinda Blaine, Associate Director, Division of
Market Regulation, SEC, dated July 24, 2000,
attached as Exhibit 3d. The question banks are
available for Commission review. The selection
specifications for the Series 53 examination, Exhibit
3e, have been omitted and filed separately with the
Commission for confidential treatment pursuant to
Rule 24b–2 of the Securities Exchange Act.
4 15 U.S.C. 78o–4(b)(2)(A).
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interest or for the protection of investors
and municipal entities or obligated
persons. The MSRB has developed
examinations that are designed to
establish that persons associated with
brokers, dealers and municipal
securities dealers that effect transactions
in municipal securities and municipal
advisors who engage in municipal
advisory activities have attained
specified levels of competence and
knowledge. The content outline for each
examination serves as a guide to the
subject matter tested on the examination
and provides learning objectives
associated with each subject matter to
assist candidates in preparing for the
examination. Each content outline also
provides sample questions similar to the
type of questions that may be found on
the examination. The arrangement of the
subject matter in the content outline
reflects the various job functions
performed within a broker, dealer or
municipal securities dealer. The MSRB
periodically reviews the content outline
for each examination to determine
whether revisions are necessary or
appropriate in view of changes
pertaining to the subject matter covered
by the examination. Below is a summary
of the proposed revisions to the Series
51, Series 52 and Series 53 content
outlines.
The selection specifications for the
Series 53 examination, which the MSRB
has submitted under separate cover with
a request for confidential treatment to
the Commission’s
Secretary pursuant to Rule 24b–2
under the Act,5 describe additional
confidential information regarding the
Series 53 examination.
MUNICIPAL FUND SECURITIES
LIMITED PRINCIPAL QUALIFICATION
EXAMINATION—SERIES 51
The Municipal Fund Securities
Limited Principal Qualification
Examination is designed to determine
whether an individual meets the
MSRB’s qualification standards for
municipal fund securities limited
principals applicable to the activities
described in Rule G–3(b)(iv).6 To do
5 17
CFR 240.24b–2.
Rule G–3(b)(iv) states that the municipal
fund securities limited principal has responsibility
to oversee the municipal securities activities of a
securities firm or bank dealer solely as such
activities relate to transactions in municipal fund
securities. In this capacity, the municipal fund
securities limited principal manages, directs or
supervises one or more of the following activities
relating to municipal fund securities as described
in Rule G–3(b)(i)(A)–(G):
(A) Underwriting, trading or sales of municipal
securities;
(B) financial advisory or consultant services for
issuers in connection with the issuance of
municipal securities;
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6 MSRB
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this, the examination measures a
candidate’s knowledge of MSRB rules,
rule interpretations and federal statutory
provisions applicable to the activities
listed above. It also measures the
candidate’s ability to apply these rules,
interpretations and federal statutory
provisions to given fact situations in the
context of municipal fund securities
activities. In addition to passing the
Series 51 examination, to qualify as a
municipal fund securities limited
principal, a candidate must also have
previously or concurrently qualified as
a general securities principal or
investment company/variable contracts
limited principal. Candidates are
allowed one and one-half hours to
complete the Series 51 examination
consisting of 60 multiple-choice
questions.
As a result of recent changes to MSRB
rules, revisions to the Series 51 content
outline are necessary to indicate the
current rule requirements and rule
citations. A summary of the changes to
the content outline for the Series 51
examination, detailed by major topic
headings, is provided below:
Introduction
• Footnote 2 will be changed to
footnote 3.
• The rule citation and quotation in
footnote 3 regarding the
‘‘Confidentiality of Qualification
Examinations’’ is being revised from
‘‘Rule G–3(e)’’ to ‘‘Rule G–3(f)’’ to
conform to amendments to Rule G–3.
Part Three: General Supervision
Qualification and Registration
• The sub-topic ‘‘Registration with
the MSRB and payment of initial fee
and annual fee A–12; A–14’’ is being
revised to ‘‘Registration requirements
A–12(a)’’ to reflect that the relevant
provision (which is now included in
Rule A–12) is no longer included in
Rule A–14, as amended.
• The rule citation and sub-topic
‘‘Notification to the MSRB of change in
(C) processing, clearance, and, in the case of
brokers, dealers and municipal securities dealers
other than bank dealers, safekeeping of municipal
securities;
(D) research or investment advice with respect to
municipal securities;
(E) any other activities which involve
communication, directly or indirectly, with public
investors in municipal securities;
(F) maintenance of records with respect to the
activities described in subparagraphs (A) through
(E); or
(G) training of municipal securities principals or
municipal securities representatives;
provided, however, that the activities enumerated
in subparagraphs (D) and (E) above shall be limited
to such activities as they relate to the activities
enumerated in subparagraphs (A) or (B) above.
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48573
status, name or address A–15’’ is being
revised to ‘‘Form A–12 updates and
withdrawal A–12(j)’’ to conform to
recent amendments of Rule A–12.
• The rule citation and sub-topic
‘‘Requirement to submit email contact to
MSRB G–40’’ is being revised to
‘‘Designated contacts A–12(f)’’ to
conform to recent amendments of Rule
A–12.
Associated Persons
• The sub-topic ‘‘financial and
operations principals G–3(d)(i) and (ii)’’
is being rescinded to reflect that this
registration category is no longer
referenced in Rule G–3.
• The sub-topic ‘‘municipal advisor
representatives G–3(d)’’ and ‘‘municipal
advisor principals G–3(e)’’ are being
added to reflect the new registration
category as referenced in Rule G–3.
• The sub-topic ‘‘Apprenticeship
requirement G–3(a)(iii)’’ is being
rescinded to reflect that, as amended,
Rule G–3 no longer has this
requirement.
• The sub-topic ‘‘Restrictions on
apprentices G–3(a)(iii)(A)’’ is being
rescinded to reflect that, as amended,
Rule G–3 no longer has this
requirement.
Supervisory Responsibilities
• The rule citation for sub-topic ‘‘1.
Responsible for municipal securities
business and activities of associated
persons’’ is being revised from ‘‘G–
27(b)(i)’’ to ‘‘G–27(b)(ii)’’ to reflect the
reorganization of Rule G–27, as
amended.
Part Four: Fair Practice and Conflicts of
Interest
Conduct of Business
• The rule citation for sub-topic
‘‘Prices and Commissions’’ is being
revised from ‘‘G–30(b); G–18’’ to ‘‘G–
30(b)’’ to reflect that the relevant
requirements are included in Rule G–30,
as amended.
• The rule citation for sub-topic
‘‘Advertising, 1. Definition’’ is being
revised from ‘‘G–21(a)’’ to ‘‘G–21(a)(i)’’
to reflect the reorganization of Rule G–
21, as amended.
Part Five: Sales Supervision
Opening Customer Accounts
• The rule citation for sub-topic
‘‘Requirement to obtain customer
account information’’ is being revised
from ‘‘G–19(a)’’ to ‘‘G–19’’ to reflect the
reorganization of Rule G–19, as
amended.
• The sub-topic ‘‘Transactions with
employees and partners of other dealers
G–28’’ is being revised to ‘‘Transactions
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with employees and partners of other
municipal securities professionals G–
28’’ to reflect the reorganization of Rule
G–28, as amended.
Suitability
• The rule citation for sub-topic
‘‘Knowledge of customer’’ is being
revised from ‘‘G–19(b)’’ to ‘‘G–19 [Supp.
.04 and .06]’’ to reflect that the relevant
requirements are included in paragraphs
.04 and .06 of the Supplementary
Material of Rule G–19, as amended.
• The rule citation for sub-topic
‘‘Suitability of recommendations’’ is
being revised from ‘‘G–19(c)’’ to ‘‘G–19
[Supp. .05]’’ to reflect that the relevant
requirements are included in paragraph
.05 of the Supplementary Material of
Rule G–19, as amended.
Improper Activities
• The title of topic ‘‘Improper
Activities’’ is being revised to
‘‘Improper Use of Customer Assets.’’
• The sub-topic and rule citation
‘‘Churning G–19(e)’’ are being revised to
‘‘Quantitative suitability G–19 [Supp.
.05(c)]’’ to reflect that the relevant
requirements are included in paragraph
.05 of the Supplementary Material of
Rule G–19, as amended.
Part Six: Underwriting and Disclosure
Obligations
Disclosures to Customers
• The sub-topic and related rule
citation ‘‘Material disclosures at time of
trade G–17’’ are being revised to ‘‘Time
of trade disclosure G–47’’ to reflect that
the requirements are included in new
Rule G–47.
Part Seven: Operations
Confirmation of Transactions
• The rule citation for sub-topic
‘‘Periodic statements’’ is being revised
from ‘‘G–15(a)(viii)’’ to ‘‘G–
15(a)(viii)(B)(1)’’ to reflect the
reorganization of Rule G–15, as
amended.
• Sample question number 2 is being
removed from the outline because the
topic (apprenticeship) is no longer
tested on the examination.
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MUNICIPAL SECURITIES
REPRESENTATIVE EXAMINATION—
SERIES 52
The Municipal Securities
Representative Qualification
Examination is designed to determine
whether an individual meets the
MSRB’s qualification standards for
municipal securities representatives by
measuring a candidate’s knowledge of
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Introduction
• The rule citation and quote in the
‘‘Confidentiality’’ section is being
revised from ‘‘Rule G–3(e)’’ to ‘‘Rule G–
3(f)’’ and added as footnote 2, to
conform to amendments to Rule G–3.
Part Four: Federal Legal Considerations
III. MSRB Rules
• The rule citation ‘‘Professional
Qualifications (G–2 through G–7)’’ is
being revised to ‘‘Standards of
Professional Qualification and
Professional Qualification Requirements
(G–2 through G–3)’’ to conform to the
current titles of the Rules, as amended.
• The rule citation ‘‘Recordkeeping
(G–8)’’ is being revised to ‘‘Books and
Records to be Made by Brokers, Dealers,
Municipal Securities Dealers, and
Municipal Advisors (G–8)’’ to conform
to the current title of Rule G–8, as
amended.
• The rule citation ‘‘Preservation of
Records (G–9)’’ is being added, to reflect
the relevant requirements included in
Rule G–9.
• The rule citation ‘‘Investor
Brochure (G–10)’’ is being revised to
7 MSRB
Sample Questions
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MSRB rules, rule interpretations and
federal statutory provisions applicable
to the activities listed in Rule G–3(a)(i).7
The Series 52 examination also
measures a candidate’s ability to apply
the rules and interpretations to given
fact situations in the context of a
representative’s municipal securities
activities. Candidates are allowed three
and one-half hours to complete the
examination consisting of 115 multiplechoice questions.
As a result of recent changes to MSRB
rules, revisions to the Series 52 content
outline are necessary to indicate the
current rule requirements and rule
citations. A summary of the changes to
the content outline for the Series 52
examination, detailed by major topic
headings, is provided below:
Rule G–3(a)(i) states:
(A) The term ‘‘municipal securities
representative’’ means a natural person associated
with a broker, dealer or municipal securities dealer,
other than a person whose functions are solely
clerical or ministerial, whose activities include one
or more of the following:
(1) underwriting, trading or sales of municipal
securities;
(2) financial advisory or consultant services for
issuers in connection with the issuance of
municipal securities;
(3) research or investment advice with respect to
municipal securities; or
(4) any other activities which involve
communication, directly or indirectly, with public
investors in municipal securities;
provided, however, that the activities enumerated
in subparagraphs (3) and (4) above shall be limited
to such activities as they relate to the activities
enumerated in subparagraphs (1) and (2) above.
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‘‘Delivery of Investor Brochure (G–10)’’
to conform to the current title of Rule
G–10.
• The rule citation ‘‘New Issue
Syndicate Practices (G–11)’’ is being
revised to ‘‘Primary Offering Practices
(G–11)’’ to conform to the current title
of Rule G–11.
• The rule citation ‘‘Conduct of
Municipal Securities Activities (G–17)’’
is being revised to ‘‘Conduct of
Municipal Securities and Municipal
Advisory Activities (G–17)’’ to conform
to the current title of Rule G–17, as
amended.
• The rule citation ‘‘Execution of
Transactions (G–18)’’ is being revised to
‘‘Best Execution (G–18)’’ to conform to
the current title of Rule G–18, as
amended.
• The rule citation ‘‘Suitability of
Recommendations and Transactions;
Discretionary Accounts (G–19)’’ is being
revised to ‘‘Suitability of
Recommendations and Transactions (G–
19)’’ to conform to the current title of
Rule G–19, as amended.
• The rule citation ‘‘Disclosure of
Control Relationships (G–22)’’ is being
revised to ‘‘Control Relationships (G–
22)’’ to conform to the current title of
Rule G–22, as amended.
• The rule citation ‘‘Transactions
with Employees of Other Municipal
Securities Professionals (G–28)’’ is being
revised to ‘‘Transactions with
Employees and Partners of Other
Municipal Securities Professionals (G–
28)’’ to conform to the current title of
Rule G–28, as amended.
• The rule citation ‘‘Calculations (G–
33)’’ is being added to reflect the
requirements included in Rule G–33.
• The rule citation ‘‘Broker’s Broker
(G–43)’’ is being added to reflect the
requirements included in Rule G–43.
• The rule citation ‘‘Time of Trade
Disclosure (G–47)’’ is being added to
reflect the requirements included in
Rule G–47.
• The rule citation ‘‘Transactions
with Sophisticated Municipal Market
Professionals (G–48)’’ is being added to
reflect the relevant requirements
included in Rule G–48, as amended.
MUNICIPAL SECURITIES PRINCIPAL
EXAMINATION—SERIES 53
The Municipal Securities Principal
Qualification Examination (Series 53) is
designed to determine whether an
individual meets the Board’s
qualification standards for municipal
securities principals. The Series 53
examination measures a candidate’s
knowledge of Board rules, rule
interpretations and federal statutory
provisions applicable to municipal
securities activities. It also measures an
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individual’s ability to apply these rules
and interpretations to given fact
situations. Candidates are allowed three
hours to complete the examination
consisting of 100 multiple-choice
questions.8
The selection specifications for the
Series 53 examination, which the MSRB
has submitted under separate cover with
a request for confidential treatment to
the Commission’s Secretary pursuant to
Rule 24b–2 under the Act,9 describe
additional confidential information
regarding the Series 53 examination.
Due to the changes in the selection
specifications the weighting for 5 of the
6 topic areas of the Series 53 content
outline have changed. The first topic
area, Federal Regulation, remains the
same at 4% of the exam. The second
topic area, General Supervision, is 23%
of the exam. The third topic area, Sales
Supervision, is 25% of the exam. The
fourth topic area, Origination and
Syndication, is 23% of the exam. The
fifth topic area, Trading, is 10% of the
exam. The sixth topic area, Operations,
is 15% of the exam.
As a result of recent changes to MSRB
rules, revisions to the Series 53 content
outline are necessary to indicate the
current rule requirements and rule
citations. A summary of the changes to
the content outline for the Series 53
examination, detailed by major topic
headings, is provided below:
Introduction
• The rule citation and quotation in
footnote 2 regarding ‘‘Confidentiality’’ is
being revised from ‘‘Rule G–3(e)’’ to
tkelley on DSK3SPTVN1PROD with NOTICES
8 MSRB
Rule G–3(b)(i) states:
(i) Definition. The term ‘‘municipal securities
principal’’ means a natural person (other than a
municipal securities sales principal), associated
with a broker, dealer or municipal securities dealer
who is directly engaged in the management,
direction or supervision of one or more of the
following activities:
(A) underwriting, trading or sales of municipal
securities;
(B) financial advisory or consultant services for
issuers in connection with the issuance of
municipal securities;
(C) processing, clearance, and, in the case of
brokers, dealers and municipal securities dealers
other than bank dealers, safekeeping of municipal
securities;
(D) research or investment advice with respect to
municipal securities;
(E) any other activities which involve
communication, directly or indirectly, with public
investors in municipal securities;
(F) maintenance of records with respect to the
activities described in subparagraphs (A) through
(E); or
(G) training of municipal securities principals or
municipal securities representatives;
provided, however, that the activities enumerated
in subparagraphs (D) and (E) above shall be limited
to such activities as they relate to the activities
enumerated in subparagraphs (A) or (B) above.
9 17 CFR 240.24b–2.
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Jkt 235001
‘‘Rule G–3(f)’’ to conform to
amendments to Rule G–3.
Part One: Federal Regulations
Rules of the Securities and Exchange
Commission
• The rule citation ‘‘Dodd-Frank Wall
Street Financial Reform and Consumer
Protection Act’’ is being added to reflect
the current status of federal securities
law.
Part Two: General Supervision
Definitional Rules
• The rule citation ‘‘Associated
person D–11’’ is being added to reflect
the requirements included in Rule D–
11, as amended.
• The rule citation ‘‘Sophisticated
Municipal Market Professional (SMMP)
D–15’’ is being added to reflect the
requirements included in Rule D–15, as
amended.
Qualification and Registration
• The rule citation ‘‘Registration with
the MSRB and payment of initial fee A–
12’’ is being revised to ‘‘Registration A–
12’’ to conform to amendments to Rule
A–12.
• The topic ‘‘MSRB annual fee A–14’’
is being removed to reflect that the
relevant provision of Rule A–14 is now
included in Rule A–12, as amended.
• The rule citation ‘‘Assessments for
Municipal Advisor Professionals A–11’’
is being added to reflect the new
requirement in Rule A–11.
• The topic ‘‘Electronic mail contacts
G–40’’ is being removed because Rule
G–40 has been rescinded.
• The rule citation ‘‘Notification to
the MSRB of change in status, name or
address A–15’’ is being removed to
reflect that the relevant provision of
Rule A–15 is now included in Rule A–
12, as amended.
• The rule citation ‘‘Limited
representative—investment company
and variable contracts products G–
3(a)(i)(C)’’ is being added to reflect the
requirements included in Rule G–3, as
amended.
• The rule citation ‘‘Municipal
advisor representative G–3(d)’’ is being
added to reflect the requirements
included in Rule G–3, as amended.
• The rule citation ‘‘Municipal
advisor principal G–3(e)’’ is being added
to reflect the requirements included in
Rule G–3, as amended.
• The topic ‘‘financial and operations
principals G–3d(i) and (ii)’’ is being
removed to reflect the rescission of the
requirement in Rule G–3d(i) and (ii), as
amended.
• The rule citation ‘‘Continuing
education requirements G–3(h)’’ is being
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48575
revised to ‘‘Continuing education
requirements G–3(i)’’ to reflect the
reorganization of Rule G–3, as amended.
• The rule citation ‘‘Confidentiality of
qualification examinations G–3(e)’’ is
being revised to ‘‘Confidentiality of
qualification examinations G–3(f)’’ to
reflect the reorganization of Rule G–3, as
amended.
• The topic ‘‘Apprenticeship
requirement G–3(a)(iii)’’ is being
removed to reflect the rescission of the
requirement.
Supervisory Responsibilities
• The rule citation ‘‘Responsibility for
municipal securities business and
activities of associated persons G–
27(b)(i)’’ is being revised to
‘‘Responsibility for municipal securities
business and activities of associated
persons G–27(b)’’ to reflect the
reorganization of Rule G–27.
• The topic and rule citation
‘‘Internal inspections G–27(d)’’ is being
added to reflect the requirements
included in Rule G–27.
• The topic area ‘‘Definition G–22(a)’’
is being revised to ‘‘Definition of control
relationship G–22(a)’’ to provide clarity
to the title of the topic area.
• The topic area ‘‘Definitions G–
20(e)’’ is being revised to ‘‘Definitions of
‘non-cash compensation’, ‘cash
compensation’, ‘offeror’ and ‘primary
offering’ G–20(e)’’ to provide clarity to
the title of the topic area.
• The topic area ‘‘Prohibition from
engaging in municipal securities
business’’ is being revised to ‘‘Political
contributions and prohibition from
engaging in municipal securities
business’’ to provide clarity to the title
of the topic area.
• The topic area ‘‘Definitions G–
37(g)’’ is being revised to ‘‘Definitions
including ‘municipal finance
professional,’ ‘municipal securities
businesses’ and ‘issuer official’ G–37(g)’’
to provide clarity to the title of the topic
area.
• The topic area ‘‘Period of
prohibition G–37(b)’’ is being revised to
‘‘Ban on municipal securities business;
de minimis exemption G–37(b)’’ to
conform to the title of Rule G–37.
• The topic area and rule citation
‘‘Prohibition on Soliciting and
Coordinating Contributions G–37(c)’’ is
being added to reflect the requirements
included in Rule G–37.
• The topic area ‘‘Definitions G–
21(a)’’ is being revised to ‘‘Definitions;
General standard for advertisements G–
21(a)(iii)’’ to provide clarity to the title
of the topic area.
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Federal Register / Vol. 80, No. 156 / Thursday, August 13, 2015 / Notices
Part Three: Sales Supervision
Opening Customer Accounts
• The rule citation ‘‘Requirement to
obtain customer account information G–
19(a)’’ is being revised to ‘‘Requirement
to obtain customer account information
G–19’’ to reflect the reorganization of
Rule G–19, as amended.
• The topic area ‘‘Transactions with
employees and partners of other
dealers’’ is being revised to
‘‘Transactions with employees and
partners of other municipal securities
professionals’’ to provide clarity to the
title of the topic area.
• The topic area ‘‘Exemption for
municipal fund securities G–28(c)’’ is
being added to reflect the relevant
requirements included in Rule G–28.
tkelley on DSK3SPTVN1PROD with NOTICES
Communications With Customers
• The topic area and rule citation
‘‘Restrictions on apprentices G–
3(a)(iii)(A)’’ is being removed to reflect
the rescission of the requirement in Rule
G–3, as amended.
• The topic area and rule citation
‘‘Tape recording of conversations G–
27(c)(ii)’’ is being added to reflect the
requirements included in Rule G–27.
Suitability
• The rule citation for topic area
‘‘Knowledge of customer G–19(b)’’ is
being revised to ‘‘Knowledge of
customer G–19 [Supp. .04]’’ to reflect
that the relevant requirements are
included in paragraph .04 of the
Supplementary Material of Rule G–19,
as amended.
• The rule citation for topic area
‘‘Suitability of recommendations G–
19(c)’’ is being revised to ‘‘Suitability of
recommendations and transactions G–
19’’ to reflect that the relevant
requirements are included in Rule G–19,
as amended.
• The topic area and rule citation
‘‘Time of trade disclosure G–47’’ is
being added to reflect the requirements
included in Rule G–47.
• The topic area and rule citation
‘‘Sophisticated Municipal Market
Professionals (SMMP) G–48’’ is being
added to reflect the requirements
included in Rule G–48, as amended.
• The section header ‘‘Improper
Activities’’ is being revised to
‘‘Supervisory Concerns’’ to provide
clarity to the title of the section.
• The topic area and rule citation
‘‘Churning G–19(e)’’ is being revised to
‘‘Quantitative Suitability G–19 [Supp.
.05]’’ to reflect that the relevant
requirements are included in paragraph
.05 of the Supplementary Material of
Rule G–19, as amended.
• The topic area ‘‘Prohibition against
soliciting and coordinating political
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contributions G–37(c) and (d)’’ is being
revised to ‘‘Prohibition against soliciting
and coordinating political contributions;
and circumvention of rule, G–37(c) and
(d)’’ to reflect that the relevant
requirements are included in Rule G–37.
Discretionary Accounts
• The topic area and rule citation
‘‘Suitability G–19(d)’’ is being moved to
the suitability section in Part three of
the content outline.
• The topic area and rule citation
‘‘Written supervisory procedures G–
27(c)(i)’’ is being revised to ‘‘Approval
of transactions G–27(c)(i)(G)(2)’’ to
reflect the reorganization of Rule G–27.
Customer Complaints
• The rule citation for topic area
‘‘Review by a principal G–27(c)(ii)’’ is
being revised to ‘‘Review by a principal
G–27(c)(i)(B)’’ to reflect the
reorganization of Rule G–27.
Part Four: Orientation and Syndication
New Issue Syndicate Practices
• The topic area and rule citation
‘‘Retail order period and required
disclosures G–11(k)’’ are being added to
reflect the requirements included in
Rule G–11.
• The topic area ‘‘Definitions A–
13(f)’’ is being revised to ‘‘Definition of
primary offering A–13(f)’’ to provide
clarity to the title of the topic area.
Part Five: Trading
Execution of Transactions
• The topic area ‘‘Transactions as
agent G–18’’ is being revised to ‘‘Best
execution G–18’’ to reflect the
requirements included in Rule G–18.
• The topic area ‘‘Prices and
Commissions’’ is being added to reflect
the requirements included in Rule G–
30.
• The topic area and rule citation
‘‘Principal transactions G–30(a)’’ is
being moved from section two regarding
general supervision to section five
regarding trading.
• The topic area and rule citation
‘‘Agency transactions G–30(b)’’ is being
moved from section two regarding
general supervision to section five
regarding trading.
• The topic area and rule citation
‘‘Time of trade disclosure G–47’’ is
being added to reflect the requirements
included in Rule G–47, as amended.
Reports of Sales or Purchases
• The topic area ‘‘Definitions G–14,
RTRS Procedures, Sect. (d)’’ is being
revised to ‘‘Definitions relating to
reporting requirements for specific types
of transactions’’ to provide clarity to the
title of the topic area.
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2. Statutory Basis
The MSRB believes that the proposed
rule change is consistent with the
provisions of Section 15B(b)(2)(A) of the
Act,10 which authorizes the MSRB to
prescribe for municipal securities
brokers or municipal securities dealers
and their associated persons standards
of training, experience, competence, and
such other qualifications as the Board
finds necessary or appropriate in the
public interest or for the protection of
investors and municipal entities or
obligated persons. Section 15B(b)(2)(A)
of the Act 11 also provides that the Board
may appropriately classify municipal
securities brokers, municipal securities
dealers, and municipal advisors and
persons associated with municipal
securities brokers, municipal securities
dealers and municipal advisors and
require persons in any such class to pass
tests prescribed by the Board.
The MSRB believes that the proposed
revisions to the content outline for the
Series 51, Series 52, and Series 53
examinations and changes to the
selection specifications for the Series 53
examination are consistent with the
provisions of Section 15B(b)(2)(A) of the
Act 12 in that the revisions will ensure
that certain key concepts and rules are
tested on each of the examinations in
order to test the competency of
individuals seeking to qualify as a
municipal fund securities limited
principal, municipal securities
representative and municipal securities
principal with respect to their
knowledge of MSRB rules and the
municipal securities market.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The MSRB does not believe that the
proposed rule change will result in any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The updated
Series 51, Series 52, and Series 53
content outlines align with the
functions and associated tasks currently
performed by municipal fund securities
limited principals, municipal securities
representatives, and municipal
securities principals and tests
knowledge of the most current laws,
rules, and regulations and skills relevant
to those functions and associated tasks.
As such, the proposed rule change
would make the examinations more
efficient and effective.
10 15
U.S.C. 78o–4(b)(2)(A).
11 Id.
12 Id.
E:\FR\FM\13AUN1.SGM
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Federal Register / Vol. 80, No. 156 / Thursday, August 13, 2015 / Notices
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
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 13 and Rule 19b–
4(f)(6) thereunder.14 The examination
content outlines for the Series 51, Series
52 and Series 53 examinations and the
Series 52 selection specifications will
become operative on August 31, 2015.
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.
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–
2015–07 and should be submitted on or
before September 3, 2015.
For the Commission, pursuant to delegated
authority.15
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2015–19874 Filed 8–12–15; 8:45 am]
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–2015–07 on the subject line.
tkelley on DSK3SPTVN1PROD with 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:
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending Rule 6.15 To
Establish Exchange Rules Governing
the Give Up of a Clearing Member by
Options Trading Permit Holders and
OTP Firms and Conforming Changes
to Rules 6.66 and 6.79
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–2015–07. 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
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–75641; File No. SR–
NYSEArca–2015–65]
August 7, 2015.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on July 27,
2015, NYSE Arca, Inc. (the ‘‘Exchange’’
or ‘‘NYSE Arca’’) filed with the
Securities and Exchange Commission
(the ‘‘Commission’’) the proposed rule
change as described in Items I and II
15 17
CFR 200.30–3(a)(12).
U.S.C.78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
1 15
13 15
14 17
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
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Frm 00102
Fmt 4703
Sfmt 4703
48577
below, which Items have been prepared
by the self-regulatory organization. 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 Exchange proposes to amend
Rule 6.15 to establish Exchange rules
governing the give up of a Clearing
Member by Options Trading Permit
Holders and OTP Firms and proposes
conforming changes to Rules 6.66 and
6.79. The text of the proposed rule
change is available on the Exchange’s
Web site at www.nyse.com, at the
principal office of the Exchange, 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
self-regulatory organization 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 those statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend
Rule 6.15 to establish Exchange rules
governing the ‘‘give up’’ of a Clearing
Member 4 by Options Trading Permit
Holders and OTP Firms (each an
‘‘OTP,’’ collectively, ‘‘OTPs’’). In
addition, the Exchange proposes
changes to Rules 6.66 and 6.79 to reflect
proposed amendments to Rule 6.15. The
Exchange believes that this proposal to
include the give-up process in Exchange
rules would result in the fair and
reasonable use of resources by both the
Exchange and OTPs. In addition, the
proposed change would align the
Exchange with competing options
4 Rule 6.1(3) defines ‘‘Clearing Member’’ as an
Exchange OTP Firm or OTP Holder which has been
admitted to membership in the Options Clearing
Corporation pursuant to the provisions of the Rules
of the Options Clearing Corporation.
E:\FR\FM\13AUN1.SGM
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]]>Agencies
[Federal Register Volume 80, Number 156 (Thursday, August 13, 2015)]
[Notices]
[Pages 48572-48577]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-19874]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-75646; File No. SR-MSRB-2015-07]
Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Notice of Filing of a Proposed Rule Change Consisting of
Revisions to the Content Outlines for the Municipal Fund Securities
Limited Principal Qualification Examination, Municipal Securities
Representative Qualification Examination and Municipal Securities
Principal Qualification Examination and Revisions to the Selection
Specifications for the Municipal Securities Principal Qualification
Examination
August 7, 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 July 31, 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 proposed revisions to the
content outlines for the Municipal Fund Securities Limited Principal
Qualification Examination (Series 51), Municipal Securities
Representative Qualification Examination (Series 52) and Municipal
Securities Principal Qualification Examination (Series 53). As a result
of changes to MSRB rules, revisions to the content outlines are
necessary to more accurately indicate the current rule requirements and
rule citations. Additionally, the MSRB is proposing revisions to the
selection specifications for the Series 53 qualification examination
(collectively, the ``proposed rule change'').\3\ The MSRB is not
proposing any textual changes to its rules.
---------------------------------------------------------------------------
\3\ The MSRB is also proposing changes to the question banks for
the Series 51, Series 52 and Series 53 examinations, but based upon
instructions from the Commission staff, the MSRB is submitting SR-
MSRB-2015-07 for immediate effectiveness pursuant to Section
19(b)(3)(A)(i) of the Act and Rule 19b-4(f)(6) thereunder, and is
not filing the question banks for Commission review. See letter to
Diane G. Klinke, General Counsel, MSRB, from Belinda Blaine,
Associate Director, Division of Market Regulation, SEC, dated July
24, 2000, attached as Exhibit 3d. The question banks are available
for Commission review. The selection specifications for the Series
53 examination, Exhibit 3e, have been omitted and filed separately
with the Commission for confidential treatment pursuant to Rule 24b-
2 of the Securities Exchange Act.
---------------------------------------------------------------------------
The text of the proposed rule change is available on the MSRB's Web
site at 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
Section 15B(b)(2)(A) of the Act \4\ authorizes the MSRB to
prescribe for municipal securities brokers or municipal securities
dealers and their associated persons standards of training, experience,
competence, and such other qualifications as the Board finds necessary
or appropriate in the public
[[Page 48573]]
interest or for the protection of investors and municipal entities or
obligated persons. The MSRB has developed examinations that are
designed to establish that persons associated with brokers, dealers and
municipal securities dealers that effect transactions in municipal
securities and municipal advisors who engage in municipal advisory
activities have attained specified levels of competence and knowledge.
The content outline for each examination serves as a guide to the
subject matter tested on the examination and provides learning
objectives associated with each subject matter to assist candidates in
preparing for the examination. Each content outline also provides
sample questions similar to the type of questions that may be found on
the examination. The arrangement of the subject matter in the content
outline reflects the various job functions performed within a broker,
dealer or municipal securities dealer. The MSRB periodically reviews
the content outline for each examination to determine whether revisions
are necessary or appropriate in view of changes pertaining to the
subject matter covered by the examination. Below is a summary of the
proposed revisions to the Series 51, Series 52 and Series 53 content
outlines.
---------------------------------------------------------------------------
\4\ 15 U.S.C. 78o-4(b)(2)(A).
---------------------------------------------------------------------------
The selection specifications for the Series 53 examination, which
the MSRB has submitted under separate cover with a request for
confidential treatment to the Commission's
Secretary pursuant to Rule 24b-2 under the Act,\5\ describe
additional confidential information regarding the Series 53
examination.
---------------------------------------------------------------------------
\5\ 17 CFR 240.24b-2.
---------------------------------------------------------------------------
MUNICIPAL FUND SECURITIES LIMITED PRINCIPAL QUALIFICATION EXAMINATION--
SERIES 51
The Municipal Fund Securities Limited Principal Qualification
Examination is designed to determine whether an individual meets the
MSRB's qualification standards for municipal fund securities limited
principals applicable to the activities described in Rule G-
3(b)(iv).\6\ To do this, the examination measures a candidate's
knowledge of MSRB rules, rule interpretations and federal statutory
provisions applicable to the activities listed above. It also measures
the candidate's ability to apply these rules, interpretations and
federal statutory provisions to given fact situations in the context of
municipal fund securities activities. In addition to passing the Series
51 examination, to qualify as a municipal fund securities limited
principal, a candidate must also have previously or concurrently
qualified as a general securities principal or investment company/
variable contracts limited principal. Candidates are allowed one and
one-half hours to complete the Series 51 examination consisting of 60
multiple-choice questions.
---------------------------------------------------------------------------
\6\ MSRB Rule G-3(b)(iv) states that the municipal fund
securities limited principal has responsibility to oversee the
municipal securities activities of a securities firm or bank dealer
solely as such activities relate to transactions in municipal fund
securities. In this capacity, the municipal fund securities limited
principal manages, directs or supervises one or more of the
following activities relating to municipal fund securities as
described in Rule G-3(b)(i)(A)-(G):
(A) Underwriting, trading or sales of municipal securities;
(B) financial advisory or consultant services for issuers in
connection with the issuance of municipal securities;
(C) processing, clearance, and, in the case of brokers, dealers
and municipal securities dealers other than bank dealers,
safekeeping of municipal securities;
(D) research or investment advice with respect to municipal
securities;
(E) any other activities which involve communication, directly
or indirectly, with public investors in municipal securities;
(F) maintenance of records with respect to the activities
described in subparagraphs (A) through (E); or
(G) training of municipal securities principals or municipal
securities representatives;
provided, however, that the activities enumerated in
subparagraphs (D) and (E) above shall be limited to such activities
as they relate to the activities enumerated in subparagraphs (A) or
(B) above.
---------------------------------------------------------------------------
As a result of recent changes to MSRB rules, revisions to the
Series 51 content outline are necessary to indicate the current rule
requirements and rule citations. A summary of the changes to the
content outline for the Series 51 examination, detailed by major topic
headings, is provided below:
Introduction
Footnote 2 will be changed to footnote 3.
The rule citation and quotation in footnote 3 regarding
the ``Confidentiality of Qualification Examinations'' is being revised
from ``Rule G-3(e)'' to ``Rule G-3(f)'' to conform to amendments to
Rule G-3.
Part Three: General Supervision
Qualification and Registration
The sub-topic ``Registration with the MSRB and payment of
initial fee and annual fee A-12; A-14'' is being revised to
``Registration requirements A-12(a)'' to reflect that the relevant
provision (which is now included in Rule A-12) is no longer included in
Rule A-14, as amended.
The rule citation and sub-topic ``Notification to the MSRB
of change in status, name or address A-15'' is being revised to ``Form
A-12 updates and withdrawal A-12(j)'' to conform to recent amendments
of Rule A-12.
The rule citation and sub-topic ``Requirement to submit
email contact to MSRB G-40'' is being revised to ``Designated contacts
A-12(f)'' to conform to recent amendments of Rule A-12.
Associated Persons
The sub-topic ``financial and operations principals G-
3(d)(i) and (ii)'' is being rescinded to reflect that this registration
category is no longer referenced in Rule G-3.
The sub-topic ``municipal advisor representatives G-3(d)''
and ``municipal advisor principals G-3(e)'' are being added to reflect
the new registration category as referenced in Rule G-3.
The sub-topic ``Apprenticeship requirement G-3(a)(iii)''
is being rescinded to reflect that, as amended, Rule G-3 no longer has
this requirement.
The sub-topic ``Restrictions on apprentices G-
3(a)(iii)(A)'' is being rescinded to reflect that, as amended, Rule G-3
no longer has this requirement.
Supervisory Responsibilities
The rule citation for sub-topic ``1. Responsible for
municipal securities business and activities of associated persons'' is
being revised from ``G-27(b)(i)'' to ``G-27(b)(ii)'' to reflect the
reorganization of Rule G-27, as amended.
Part Four: Fair Practice and Conflicts of Interest
Conduct of Business
The rule citation for sub-topic ``Prices and Commissions''
is being revised from ``G-30(b); G-18'' to ``G-30(b)'' to reflect that
the relevant requirements are included in Rule G-30, as amended.
The rule citation for sub-topic ``Advertising, 1.
Definition'' is being revised from ``G-21(a)'' to ``G-21(a)(i)'' to
reflect the reorganization of Rule G-21, as amended.
Part Five: Sales Supervision
Opening Customer Accounts
The rule citation for sub-topic ``Requirement to obtain
customer account information'' is being revised from ``G-19(a)'' to
``G-19'' to reflect the reorganization of Rule G-19, as amended.
The sub-topic ``Transactions with employees and partners
of other dealers G-28'' is being revised to ``Transactions
[[Page 48574]]
with employees and partners of other municipal securities professionals
G-28'' to reflect the reorganization of Rule G-28, as amended.
Suitability
The rule citation for sub-topic ``Knowledge of customer''
is being revised from ``G-19(b)'' to ``G-19 [Supp. .04 and .06]'' to
reflect that the relevant requirements are included in paragraphs .04
and .06 of the Supplementary Material of Rule G-19, as amended.
The rule citation for sub-topic ``Suitability of
recommendations'' is being revised from ``G-19(c)'' to ``G-19 [Supp.
.05]'' to reflect that the relevant requirements are included in
paragraph .05 of the Supplementary Material of Rule G-19, as amended.
Improper Activities
The title of topic ``Improper Activities'' is being
revised to ``Improper Use of Customer Assets.''
The sub-topic and rule citation ``Churning G-19(e)'' are
being revised to ``Quantitative suitability G-19 [Supp. .05(c)]'' to
reflect that the relevant requirements are included in paragraph .05 of
the Supplementary Material of Rule G-19, as amended.
Part Six: Underwriting and Disclosure Obligations
Disclosures to Customers
The sub-topic and related rule citation ``Material
disclosures at time of trade G-17'' are being revised to ``Time of
trade disclosure G-47'' to reflect that the requirements are included
in new Rule G-47.
Part Seven: Operations
Confirmation of Transactions
The rule citation for sub-topic ``Periodic statements'' is
being revised from ``G-15(a)(viii)'' to ``G-15(a)(viii)(B)(1)'' to
reflect the reorganization of Rule G-15, as amended.
Sample Questions
Sample question number 2 is being removed from the outline
because the topic (apprenticeship) is no longer tested on the
examination.
MUNICIPAL SECURITIES REPRESENTATIVE EXAMINATION--SERIES 52
The Municipal Securities Representative Qualification Examination
is designed to determine whether an individual meets the MSRB's
qualification standards for municipal securities representatives by
measuring a candidate's knowledge of MSRB rules, rule interpretations
and federal statutory provisions applicable to the activities listed in
Rule G-3(a)(i).\7\ The Series 52 examination also measures a
candidate's ability to apply the rules and interpretations to given
fact situations in the context of a representative's municipal
securities activities. Candidates are allowed three and one-half hours
to complete the examination consisting of 115 multiple-choice
questions.
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\7\ MSRB Rule G-3(a)(i) states:
(A) The term ``municipal securities representative'' means a
natural person associated with a broker, dealer or municipal
securities dealer, other than a person whose functions are solely
clerical or ministerial, whose activities include one or more of the
following:
(1) underwriting, trading or sales of municipal securities;
(2) financial advisory or consultant services for issuers in
connection with the issuance of municipal securities;
(3) research or investment advice with respect to municipal
securities; or
(4) any other activities which involve communication, directly
or indirectly, with public investors in municipal securities;
provided, however, that the activities enumerated in
subparagraphs (3) and (4) above shall be limited to such activities
as they relate to the activities enumerated in subparagraphs (1) and
(2) above.
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As a result of recent changes to MSRB rules, revisions to the
Series 52 content outline are necessary to indicate the current rule
requirements and rule citations. A summary of the changes to the
content outline for the Series 52 examination, detailed by major topic
headings, is provided below:
Introduction
The rule citation and quote in the ``Confidentiality''
section is being revised from ``Rule G-3(e)'' to ``Rule G-3(f)'' and
added as footnote 2, to conform to amendments to Rule G-3.
Part Four: Federal Legal Considerations
III. MSRB Rules
The rule citation ``Professional Qualifications (G-2
through G-7)'' is being revised to ``Standards of Professional
Qualification and Professional Qualification Requirements (G-2 through
G-3)'' to conform to the current titles of the Rules, as amended.
The rule citation ``Recordkeeping (G-8)'' is being revised
to ``Books and Records to be Made by Brokers, Dealers, Municipal
Securities Dealers, and Municipal Advisors (G-8)'' to conform to the
current title of Rule G-8, as amended.
The rule citation ``Preservation of Records (G-9)'' is
being added, to reflect the relevant requirements included in Rule G-9.
The rule citation ``Investor Brochure (G-10)'' is being
revised to ``Delivery of Investor Brochure (G-10)'' to conform to the
current title of Rule G-10.
The rule citation ``New Issue Syndicate Practices (G-11)''
is being revised to ``Primary Offering Practices (G-11)'' to conform to
the current title of Rule G-11.
The rule citation ``Conduct of Municipal Securities
Activities (G-17)'' is being revised to ``Conduct of Municipal
Securities and Municipal Advisory Activities (G-17)'' to conform to the
current title of Rule G-17, as amended.
The rule citation ``Execution of Transactions (G-18)'' is
being revised to ``Best Execution (G-18)'' to conform to the current
title of Rule G-18, as amended.
The rule citation ``Suitability of Recommendations and
Transactions; Discretionary Accounts (G-19)'' is being revised to
``Suitability of Recommendations and Transactions (G-19)'' to conform
to the current title of Rule G-19, as amended.
The rule citation ``Disclosure of Control Relationships
(G-22)'' is being revised to ``Control Relationships (G-22)'' to
conform to the current title of Rule G-22, as amended.
The rule citation ``Transactions with Employees of Other
Municipal Securities Professionals (G-28)'' is being revised to
``Transactions with Employees and Partners of Other Municipal
Securities Professionals (G-28)'' to conform to the current title of
Rule G-28, as amended.
The rule citation ``Calculations (G-33)'' is being added
to reflect the requirements included in Rule G-33.
The rule citation ``Broker's Broker (G-43)'' is being
added to reflect the requirements included in Rule G-43.
The rule citation ``Time of Trade Disclosure (G-47)'' is
being added to reflect the requirements included in Rule G-47.
The rule citation ``Transactions with Sophisticated
Municipal Market Professionals (G-48)'' is being added to reflect the
relevant requirements included in Rule G-48, as amended.
MUNICIPAL SECURITIES PRINCIPAL EXAMINATION--SERIES 53
The Municipal Securities Principal Qualification Examination
(Series 53) is designed to determine whether an individual meets the
Board's qualification standards for municipal securities principals.
The Series 53 examination measures a candidate's knowledge of Board
rules, rule interpretations and federal statutory provisions applicable
to municipal securities activities. It also measures an
[[Page 48575]]
individual's ability to apply these rules and interpretations to given
fact situations. Candidates are allowed three hours to complete the
examination consisting of 100 multiple-choice questions.\8\
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\8\ MSRB Rule G-3(b)(i) states:
(i) Definition. The term ``municipal securities principal''
means a natural person (other than a municipal securities sales
principal), associated with a broker, dealer or municipal securities
dealer who is directly engaged in the management, direction or
supervision of one or more of the following activities:
(A) underwriting, trading or sales of municipal securities;
(B) financial advisory or consultant services for issuers in
connection with the issuance of municipal securities;
(C) processing, clearance, and, in the case of brokers, dealers
and municipal securities dealers other than bank dealers,
safekeeping of municipal securities;
(D) research or investment advice with respect to municipal
securities;
(E) any other activities which involve communication, directly
or indirectly, with public investors in municipal securities;
(F) maintenance of records with respect to the activities
described in subparagraphs (A) through (E); or
(G) training of municipal securities principals or municipal
securities representatives;
provided, however, that the activities enumerated in
subparagraphs (D) and (E) above shall be limited to such activities
as they relate to the activities enumerated in subparagraphs (A) or
(B) above.
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The selection specifications for the Series 53 examination, which
the MSRB has submitted under separate cover with a request for
confidential treatment to the Commission's Secretary pursuant to Rule
24b-2 under the Act,\9\ describe additional confidential information
regarding the Series 53 examination. Due to the changes in the
selection specifications the weighting for 5 of the 6 topic areas of
the Series 53 content outline have changed. The first topic area,
Federal Regulation, remains the same at 4% of the exam. The second
topic area, General Supervision, is 23% of the exam. The third topic
area, Sales Supervision, is 25% of the exam. The fourth topic area,
Origination and Syndication, is 23% of the exam. The fifth topic area,
Trading, is 10% of the exam. The sixth topic area, Operations, is 15%
of the exam.
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\9\ 17 CFR 240.24b-2.
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As a result of recent changes to MSRB rules, revisions to the
Series 53 content outline are necessary to indicate the current rule
requirements and rule citations. A summary of the changes to the
content outline for the Series 53 examination, detailed by major topic
headings, is provided below:
Introduction
The rule citation and quotation in footnote 2 regarding
``Confidentiality'' is being revised from ``Rule G-3(e)'' to ``Rule G-
3(f)'' to conform to amendments to Rule G-3.
Part One: Federal Regulations
Rules of the Securities and Exchange Commission
The rule citation ``Dodd-Frank Wall Street Financial
Reform and Consumer Protection Act'' is being added to reflect the
current status of federal securities law.
Part Two: General Supervision
Definitional Rules
The rule citation ``Associated person D-11'' is being
added to reflect the requirements included in Rule D-11, as amended.
The rule citation ``Sophisticated Municipal Market
Professional (SMMP) D-15'' is being added to reflect the requirements
included in Rule D-15, as amended.
Qualification and Registration
The rule citation ``Registration with the MSRB and payment
of initial fee A-12'' is being revised to ``Registration A-12'' to
conform to amendments to Rule A-12.
The topic ``MSRB annual fee A-14'' is being removed to
reflect that the relevant provision of Rule A-14 is now included in
Rule A-12, as amended.
The rule citation ``Assessments for Municipal Advisor
Professionals A-11'' is being added to reflect the new requirement in
Rule A-11.
The topic ``Electronic mail contacts G-40'' is being
removed because Rule G-40 has been rescinded.
The rule citation ``Notification to the MSRB of change in
status, name or address A-15'' is being removed to reflect that the
relevant provision of Rule A-15 is now included in Rule A-12, as
amended.
The rule citation ``Limited representative--investment
company and variable contracts products G-3(a)(i)(C)'' is being added
to reflect the requirements included in Rule G-3, as amended.
The rule citation ``Municipal advisor representative G-
3(d)'' is being added to reflect the requirements included in Rule G-3,
as amended.
The rule citation ``Municipal advisor principal G-3(e)''
is being added to reflect the requirements included in Rule G-3, as
amended.
The topic ``financial and operations principals G-3d(i)
and (ii)'' is being removed to reflect the rescission of the
requirement in Rule G-3d(i) and (ii), as amended.
The rule citation ``Continuing education requirements G-
3(h)'' is being revised to ``Continuing education requirements G-3(i)''
to reflect the reorganization of Rule G-3, as amended.
The rule citation ``Confidentiality of qualification
examinations G-3(e)'' is being revised to ``Confidentiality of
qualification examinations G-3(f)'' to reflect the reorganization of
Rule G-3, as amended.
The topic ``Apprenticeship requirement G-3(a)(iii)'' is
being removed to reflect the rescission of the requirement.
Supervisory Responsibilities
The rule citation ``Responsibility for municipal
securities business and activities of associated persons G-27(b)(i)''
is being revised to ``Responsibility for municipal securities business
and activities of associated persons G-27(b)'' to reflect the
reorganization of Rule G-27.
The topic and rule citation ``Internal inspections G-
27(d)'' is being added to reflect the requirements included in Rule G-
27.
The topic area ``Definition G-22(a)'' is being revised to
``Definition of control relationship G-22(a)'' to provide clarity to
the title of the topic area.
The topic area ``Definitions G-20(e)'' is being revised to
``Definitions of `non-cash compensation', `cash compensation',
`offeror' and `primary offering' G-20(e)'' to provide clarity to the
title of the topic area.
The topic area ``Prohibition from engaging in municipal
securities business'' is being revised to ``Political contributions and
prohibition from engaging in municipal securities business'' to provide
clarity to the title of the topic area.
The topic area ``Definitions G-37(g)'' is being revised to
``Definitions including `municipal finance professional,' `municipal
securities businesses' and `issuer official' G-37(g)'' to provide
clarity to the title of the topic area.
The topic area ``Period of prohibition G-37(b)'' is being
revised to ``Ban on municipal securities business; de minimis exemption
G-37(b)'' to conform to the title of Rule G-37.
The topic area and rule citation ``Prohibition on
Soliciting and Coordinating Contributions G-37(c)'' is being added to
reflect the requirements included in Rule G-37.
The topic area ``Definitions G-21(a)'' is being revised to
``Definitions; General standard for advertisements G-21(a)(iii)'' to
provide clarity to the title of the topic area.
[[Page 48576]]
Part Three: Sales Supervision
Opening Customer Accounts
The rule citation ``Requirement to obtain customer account
information G-19(a)'' is being revised to ``Requirement to obtain
customer account information G-19'' to reflect the reorganization of
Rule G-19, as amended.
The topic area ``Transactions with employees and partners
of other dealers'' is being revised to ``Transactions with employees
and partners of other municipal securities professionals'' to provide
clarity to the title of the topic area.
The topic area ``Exemption for municipal fund securities
G-28(c)'' is being added to reflect the relevant requirements included
in Rule G-28.
Communications With Customers
The topic area and rule citation ``Restrictions on
apprentices G-3(a)(iii)(A)'' is being removed to reflect the rescission
of the requirement in Rule G-3, as amended.
The topic area and rule citation ``Tape recording of
conversations G-27(c)(ii)'' is being added to reflect the requirements
included in Rule G-27.
Suitability
The rule citation for topic area ``Knowledge of customer
G-19(b)'' is being revised to ``Knowledge of customer G-19 [Supp.
.04]'' to reflect that the relevant requirements are included in
paragraph .04 of the Supplementary Material of Rule G-19, as amended.
The rule citation for topic area ``Suitability of
recommendations G-19(c)'' is being revised to ``Suitability of
recommendations and transactions G-19'' to reflect that the relevant
requirements are included in Rule G-19, as amended.
The topic area and rule citation ``Time of trade
disclosure G-47'' is being added to reflect the requirements included
in Rule G-47.
The topic area and rule citation ``Sophisticated Municipal
Market Professionals (SMMP) G-48'' is being added to reflect the
requirements included in Rule G-48, as amended.
The section header ``Improper Activities'' is being
revised to ``Supervisory Concerns'' to provide clarity to the title of
the section.
The topic area and rule citation ``Churning G-19(e)'' is
being revised to ``Quantitative Suitability G-19 [Supp. .05]'' to
reflect that the relevant requirements are included in paragraph .05 of
the Supplementary Material of Rule G-19, as amended.
The topic area ``Prohibition against soliciting and
coordinating political contributions G-37(c) and (d)'' is being revised
to ``Prohibition against soliciting and coordinating political
contributions; and circumvention of rule, G-37(c) and (d)'' to reflect
that the relevant requirements are included in Rule G-37.
Discretionary Accounts
The topic area and rule citation ``Suitability G-19(d)''
is being moved to the suitability section in Part three of the content
outline.
The topic area and rule citation ``Written supervisory
procedures G-27(c)(i)'' is being revised to ``Approval of transactions
G-27(c)(i)(G)(2)'' to reflect the reorganization of Rule G-27.
Customer Complaints
The rule citation for topic area ``Review by a principal
G-27(c)(ii)'' is being revised to ``Review by a principal G-
27(c)(i)(B)'' to reflect the reorganization of Rule G-27.
Part Four: Orientation and Syndication
New Issue Syndicate Practices
The topic area and rule citation ``Retail order period and
required disclosures G-11(k)'' are being added to reflect the
requirements included in Rule G-11.
The topic area ``Definitions A-13(f)'' is being revised to
``Definition of primary offering A-13(f)'' to provide clarity to the
title of the topic area.
Part Five: Trading
Execution of Transactions
The topic area ``Transactions as agent G-18'' is being
revised to ``Best execution G-18'' to reflect the requirements included
in Rule G-18.
The topic area ``Prices and Commissions'' is being added
to reflect the requirements included in Rule G-30.
The topic area and rule citation ``Principal transactions
G-30(a)'' is being moved from section two regarding general supervision
to section five regarding trading.
The topic area and rule citation ``Agency transactions G-
30(b)'' is being moved from section two regarding general supervision
to section five regarding trading.
The topic area and rule citation ``Time of trade
disclosure G-47'' is being added to reflect the requirements included
in Rule G-47, as amended.
Reports of Sales or Purchases
The topic area ``Definitions G-14, RTRS Procedures, Sect.
(d)'' is being revised to ``Definitions relating to reporting
requirements for specific types of transactions'' to provide clarity to
the title of the topic area.
2. Statutory Basis
The MSRB believes that the proposed rule change is consistent with
the provisions of Section 15B(b)(2)(A) of the Act,\10\ which authorizes
the MSRB to prescribe for municipal securities brokers or municipal
securities dealers and their associated persons standards of training,
experience, competence, and such other qualifications as the Board
finds necessary or appropriate in the public interest or for the
protection of investors and municipal entities or obligated persons.
Section 15B(b)(2)(A) of the Act \11\ also provides that the Board may
appropriately classify municipal securities brokers, municipal
securities dealers, and municipal advisors and persons associated with
municipal securities brokers, municipal securities dealers and
municipal advisors and require persons in any such class to pass tests
prescribed by the Board.
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\10\ 15 U.S.C. 78o-4(b)(2)(A).
\11\ Id.
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The MSRB believes that the proposed revisions to the content
outline for the Series 51, Series 52, and Series 53 examinations and
changes to the selection specifications for the Series 53 examination
are consistent with the provisions of Section 15B(b)(2)(A) of the Act
\12\ in that the revisions will ensure that certain key concepts and
rules are tested on each of the examinations in order to test the
competency of individuals seeking to qualify as a municipal fund
securities limited principal, municipal securities representative and
municipal securities principal with respect to their knowledge of MSRB
rules and the municipal securities market.
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\12\ Id.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The MSRB does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. The updated Series 51, Series
52, and Series 53 content outlines align with the functions and
associated tasks currently performed by municipal fund securities
limited principals, municipal securities representatives, and municipal
securities principals and tests knowledge of the most current laws,
rules, and regulations and skills relevant to those functions and
associated tasks. As such, the proposed rule change would make the
examinations more efficient and effective.
[[Page 48577]]
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
Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \13\ and Rule 19b-
4(f)(6) thereunder.\14\ The examination content outlines for the Series
51, Series 52 and Series 53 examinations and the Series 52 selection
specifications will become operative on August 31, 2015.
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\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 17 CFR 240.19b-4(f)(6).
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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:
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-2015-07 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-2015-07. 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-2015-07 and should be
submitted on or before September 3, 2015.
For the Commission, pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2015-19874 Filed 8-12-15; 8:45 am]
BILLING CODE 8011-01-P
