Letters

MSRB’s Draft Best Execution Rule

Summary

SIFMA provides comments to the Municipal Securities Rulemaking Board (MSRB) on the MSRB’s draft Best Execution Rule, including exception for transactions with sophisticated municipal market professionals (SMMPs), MSRB Notice 2014-02.

SIFMA believes an execution diligence process resulting in a price that is fair and reasonable under prevailing market conditions is more reflective of the appropriate balance of investor protection interests with the need for efficient municipal markets. It also complements a dealer’s pricing obligation under Rule G-30. Before the MSRB adopts a final rule, SIFMA requests additional information and guidance from the MSRB relating to the harmonization of Rule G-18 and G-30, as well as compliance issues. Additionally, the MSRB should separately issue a request for data and other information, in particular quantitative data, relating to the benefits and costs that could result from various alternative approaches regarding the standards of conduct and other obligations relating to its Proposal.

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