MSRB Best Execution Rule Proposal and Changes to SMMP

SIFMA submitted comments on the Municipal Securities Rulemaking Board’s (MSRB) filing with the Securities and Exchange Commission (SEC) on notice of filing of a Proposed Rule Change Consisting of Rule G-18, on Best Execution of Transactions in Municipal Securities, and Amendments to Rule G-48, on Transactions with Sophisticated Municipal Market Professionals (SMMP), and Rule D-15, on the Definition of SMMP (the Proposal).

SIFMA supports raising the execution standard in the municipal market for retail customers in a way that reflects the current market structure and unique characteristics of the municipal market. SIFMA believes that the MSRB has thoughtfully developed and proposed revisions to MSRB Rule G-18 that reflect the unique characteristics of the municipal securities market and warrant certain departures from FINRA 5310. SIFMA also supports the proposed changes to Rule G-48.

However, SIFMA has significant concerns regarding the proposed changes to Rule D-15 and urges the SEC not to move forward with the proposed changes to D-15 at this time to allow the MSRB to solicit public comments for its board members to consider. In the alternative, SIFMA is requesting that the SEC adopt SIFMA’s proposed revisions to Rule D-15.