The MSRB amended proposed changes to its 2012 interpretive notice concerning the conduct of municipal securities underwriting and municipal advisory activities. The MSRB stated that it based the amendments on comment letters received after the original proposal was published in the Federal Register.

As previously covered, the MSRB proposed to amend its interpretive guidance under MSRB Rule G-17 ("Conduct of Municipal Securities and Municipal Advisory Activities"). The proposed amendments are intended to reduce the disclosure burdens on underwriters, as well as the burden on issuers to acknowledge and review disclosures of risks that are (i) unlikely to materialize, (ii) not unique to a particular transaction or underwriter where a syndicate is formed, or (iii) otherwise duplicative.

Based on the comment letters, the MSRB updated the proposal to, among other things:

  • make clear that an underwriter has a "fair dealing obligation" to provide applicable transaction-specific disclosures to an issuer;
  • further supplement the 2012 Interpretative Notice to provide that disclosures "must not be inaccurate or misleading," and to clarify that the notice does not require underwriters to make false disclosures;
  • make clear that the proposed rule change does not apply to a dealer acting as a primary distributor in a continuous offering of municipal fund securities; and
  • clarify to whom disclosures must be delivered.

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