The MSRB will review its 2012 interpretive guidance on the fair-dealing obligation of underwriters ("2012 Guidance").
The 2012 Guidance provides clarity on certain elements of MSRB Rule G-17, which prohibits deceptive, dishonest or unfair activities of underwriters of municipal securities. Under the 2012 Guidance, underwriters are required to make various disclosures to issuers. The MSRB received informal feedback from some market participants who described instances where disclosures to issuers were essentially devoid of meaning or overly duplicative and burdensome to review. These market participants reported observing:
- dealers providing issuers with "overly boilerplate disclosures";
- multiple underwriters for the same transaction giving identical disclosures to the issuer; and
- frequent issuers receiving identical disclosures from underwriters.
The MSRB is seeking public input regarding, among other things:
- disclosures from syndicate managers concerning underwriters;
- whether dealers typically provide disclosures to conduit issuers and conduit borrowers;
- whether the 2012 Guidance has improved fair dealings by underwriters with issuers; and
- additional requirements (other than the disclosure requirements) that should be modified in the 2012 Guidance.
The MSRB deadline for feedback is August 6, 2018.
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