[Federal Register Volume 76, Number 49 (Monday, March 14, 2011)]
[Proposed Rules]
[Pages 13572-13576]
[FR Doc No: 2011-5828]

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

44 CFR Part 67

[Docket ID FEMA-2010-0003; Internal Agency Docket No. FEMA-B-1168]

Proposed Flood Elevation Determinations

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Proposed rule; correction.

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SUMMARY: On December 7, 2010, FEMA published in the Federal Register a
proposed rule that contained an erroneous table. This notice provides
corrections to that table, to be used in lieu of the information
published at 75 FR 75945. The table provided here represents the
flooding sources, location of referenced elevations, effective and
modified elevations, and communities affected for Skagit County,
Washington and Incorporated Areas. Specifically, it addresses the
following flooding sources: Left Bank Overflow Main Stem Skagit River,
Left Bank Overflow Main Stem Skagit River/South Fork Skagit River, Left
Bank Overflow North Fork Skagit River, Main Stem Skagit River, North
Fork Skagit River, Overflow from the Main Stem Skagit River between the
North Fork Skagit River and the South Fork Skagit River, Padilla Bay,
Right Bank Overflow Main Stem Skagit River, Right Bank Overflow Main
Stem Skagit River/North Fork Skagit River, Right Bank Overflow North
Fork Skagit River, Right Bank Overflow South Fork Skagit River, Samish
Bay, Samish Bay/Padilla Bay, Simlik Bay, Skagit Bay, Skagit Bay/
Swinomish Channel, Skagit River, Skagit River Delta Overbank Flowpath
1, Skagit River Delta Overbank Flowpath 2, Skagit River Delta Overbank
Flowpath 3, South Fork Skagit River, and Swinomish Channel.

DATES: Comments are to be submitted on or before June 13, 2011.

ADDRESSES: You may submit comments, identified by Docket No. FEMA-B-
1168, to Luis Rodriguez, Chief, Engineering Management Branch, Federal
Insurance and Mitigation Administration, Federal Emergency Management
Agency, 500 C Street, SW., Washington, DC 20472,<PHONE_NUMBER> or (e-
mail) rodriguez1<EMAIL_ADDRESS>
FOR FURTHER INFORMATION CONTACT: Luis Rodriguez, Chief, Engineering
Management Branch, Federal Insurance and Mitigation Administration,
Federal Emergency Management Agency, 500 C Street, SW., Washington, DC
20472,<PHONE_NUMBER> or (e-mail<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: The Federal Emergency Management Agency
(FEMA) publishes proposed determinations of Base (1% annual-chance)
Flood Elevations (BFEs) and modified BFEs for communities participating
in the National Flood Insurance Program (NFIP), in accordance with
section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C.
4104, and 44 CFR 67.4(a).
    These proposed BFEs and modified BFEs, together with the floodplain
management criteria required by 44 CFR 60.3, are minimum requirements.
They should not be construed to mean that

the community must change any existing ordinances that are more
stringent in their floodplain management requirements. The community
may at any time enact stricter requirements of its own or pursuant to
policies established by other Federal, State, or regional entities.
These proposed elevations are used to meet the floodplain management
requirements of the NFIP and also are used to calculate the appropriate
flood insurance premium rates for new buildings built after these
elevations are made final, and for the contents in those buildings.

Corrections

    In the proposed rule published at 75 FR 75945, in the December 7,
2010, issue of the Federal Register, FEMA published a table under the
authority of 44 CFR 67.4. The table, entitled ``Skagit County,
Washington, and Incorporated Areas'' addressed the following flooding
sources: Left Bank Overflow Main Stem Skagit River, Left Bank Overflow
Main Stem Skagit River/South Fork Skagit River, Left Bank Overflow
North Fork Skagit River, Main Stem Skagit River, North Fork Skagit
River, Overflow from the Main Stem Skagit River between the North Fork
Skagit River and the South Fork Skagit River, Padilla Bay, Right Bank
Overflow Main Stem Skagit River, Right Bank Overflow Main Stem Skagit
River/North Fork Skagit River, Right Bank Overflow North Fork Skagit
River, Right Bank Overflow South Fork Skagit River, Samish Bay, Samish
Bay/Padilla Bay, Simlik Bay, Skagit Bay, Skagit Bay/Swinomish Channel,
Skagit River, Skagit River Delta Overbank Flowpath 1, Skagit River
Delta Overbank Flowpath 2, Skagit River Delta Overbank Flowpath 3,
South Fork Skagit River, and Swinomish Channel. That table contained
inaccurate information as to the location of referenced elevation,
effective and modified elevation in feet, and/or communities affected
for these flooding sources. It also contained erroneous map repository
addresses for the City of Burlington, the City of Sedro-Woolley, the
Swinomish Indian Tribal Community, and the Town of Lyman. There were
also some table formatting and alignment errors. In this notice, FEMA
is publishing a table containing the accurate information, to address
these prior errors. The information provided below should be used in
lieu of that previously published.

----------------------------------------------------------------------------------------------------------------
                                                                  * Elevation in feet
                                                                 (NGVD) + Elevation in
                                                                 feet (NAVD)
                                       Location of referenced     Depth in feet above
         Flooding source(s)                 elevation**        ground [caret] Elevation    Communities affected
                                                                    in meters (MSL)
                                                              --------------------------
                                                                Effective     Modified
----------------------------------------------------------------------------------------------------------------
                                Skagit County, Washington, and Incorporated Areas
----------------------------------------------------------------------------------------------------------------
Left Bank Overflow Main Stem Skagit   Approximately 1,400       2          +23  City of Mount Vernon,
 River.                                feet north of the                                  Unincorporated Areas
                                       intersection of Hickox                             of Skagit County.
                                       Road and I-5.
                                      Approximately 300 feet    2          +24
                                       west of the
                                       intersection of
                                       Anderson Road and Old
                                       Highway 99.
Left Bank Overflow Main Stem Skagit   Approximately 0.43 mile          +19          +24  City of Mount Vernon,
 River.                                east of the                                        Unincorporated Areas
                                       intersection of Dike                               of Skagit County.
                                       Road and Britt Road.
                                      Approximately 1,500              +19          +27
                                       feet west of the
                                       intersection of
                                       Riverview Lane and
                                       Dike Road.
Left Bank Overflow Main Stem Skagit   Just northwest of the     3          +26  City of Mount Vernon,
 River.                                intersection of Britt                              Unincorporated Areas
                                       Road and Dike Road.                                of Skagit County.
                                      Approximately 250 feet    3          +28
                                       north of Dike Road and
                                       approximately 1,000
                                       feet west of Riverview
                                       Lane.
Left Bank Overflow Main Stem Skagit   Approximately 900 feet    1          +25  City of Mount Vernon,
 River.                                north of Blackburn                                 Unincorporated Areas
                                       Road between 2nd                                   of Skagit County.
                                       Street and 3rd Street.
                                      At the intersection of    1          +39
                                       Freeway Drive and
                                       Cameron Way.
Left Bank Overflow Main Stem Skagit   Just north of Stewart     3          +41  City of Mount Vernon.
 River.                                Road between Riverside
                                       Drive and the
                                       Burlington Northern
                                       Railroad.
                                      Just northwest of the     3          +42
                                       intersection of Hoag
                                       Road and the
                                       Burlington Northern
                                       Railroad.
Left Bank Overflow Main Stem Skagit   Approximately 1.4 miles          +34          +40  City of Mount Vernon,
 River.                                west of the                                        Unincorporated Areas
                                       intersection of I-5                                of Skagit County.
                                       and State Route 538,
                                       at levee.
                                      At the intersection of           +34          +40
                                       the Burlington
                                       Northern Railroad and
                                       State Route 538.
Left Bank Overflow Main Stem Skagit   Just north of the               None          +24  City of Mount Vernon,
 River.                                intersection of Hickox                             Unincorporated Areas
                                       Road and Dike Road.                                of Skagit County.
                                      Approximately 640 feet          None          +27
                                       west of the
                                       intersection of
                                       Riverview Lane and
                                       Dike Road.
Left Bank Overflow Main Stem Skagit   At the intersection of          None          +24  City of Mount Vernon.
 River.                                I-5 and Anderson Road.
                                      At the intersection of          None          +28
                                       I-5 and Section Street.
Left Bank Overflow Main Stem Skagit   Just north of Fir         3          +20  City of Mount Vernon,
 River/South Fork Skagit River.        Island Road, at the                                Unincorporated Areas
                                       intersection with the                              of Skagit County.
                                       Burlington Northern
                                       Railroad.

                                      Approximately 500 feet    3          +23
                                       south of Hickox Road
                                       between the levee and
                                       the Burlington
                                       Northern Railroad.
Left Bank Overflow Main Stem Skagit   Approximately 0.75 mile          +13          +16  Unincorporated Areas of
 River/South Fork Skagit River.        south of the                                       Skagit County.
                                       intersection of
                                       Milltown Road and
                                       Pioneer Highway.
                                      At the intersection of           +13          +20
                                       State Route 534 and I-
                                       5.
Left Bank Overflow North Fork Skagit  Just east of the levee,   1          +16  Unincorporated Areas of
 River.                                approximately 350 feet                             Skagit County.
                                       northeast of the
                                       intersection of Moore
                                       Road and Polson Road.
                                      Just east of the levee,   1          +18
                                       approximately 450 feet
                                       north of Moore Road.
Main Stem Skagit River..............  At the confluence with           +27          +30  City of Burlington,
                                       the North Fork Skagit                              City of Mount Vernon,
                                       River and South Fork                               City of Sedro-Woolley,
                                       Skagit River.                                      Town of La Conner,
                                                                                Unincorporated Areas
                                                                                of Skagit County.
                                      Just downstream of the           +49          +52
                                       Burlington Northern
                                       Railroad.
North Fork Skagit River.............  At the confluence with           +14          +16  Unincorporated Areas of
                                       Skagit Bay.                                        Skagit County.
                                      At the confluence with           +27          +30
                                       the Main Stem Skagit
                                       River and South Fork
                                       Skagit River.
Overflow from the Main Stem Skagit    At the confluence with           +12          +14  Unincorporated Areas of
 River between the North Fork Skagit   Skagit Bay.                                        Skagit County.
 River and the South Fork Skagit
 River.
                                      At the intersection of           +13          +18
                                       Moore Road and Dry
                                       Slough Road.
Overflow from the Main Stem Skagit    Approximately 200 feet    3          +18  Unincorporated Areas of
 River between the North Fork Skagit   north of Moore Road                                Skagit County.
 River and the South Fork Skagit       between the North Fork
 River.                                Skagit River and Dry
                                       Slough Road.
                                      Approximately 880 feet    3          +21
                                       southwest of the
                                       confluence with North
                                       Fork Skagit River and
                                       the South Fork Skagit
                                       River.
Padilla Bay.........................  Approximately 1,000             None          +13  Swinomish Indian Tribal
                                       feet northwest of the                              Community.
                                       intersection of
                                       Highway 20 and Padilla
                                       Heights Road.
                                      Approximately 100 feet          None          +13
                                       north of the crossing
                                       at State Route 20 and
                                       the Swinomish Channel.
Right Bank Overflow Main Stem Skagit  Approximately 0.36 mile   3          +21  City of Mount Vernon,
 River.                                west of the                                        Unincorporated Areas
                                       intersection of Penn                               of Skagit County.
                                       Road and Calhoun Road.
                                      Approximately 400 feet    3          +30
                                       south of the levee
                                       between Moores Garden
                                       Road and Baker Street.
Right Bank Overflow Main Stem Skagit  Approximately 300 feet    3          +24  Unincorporated Areas of
 River.                                north of the                                       Skagit County.
                                       intersection of Dunbar
                                       Avenue and Avon Allen
                                       Road.
                                      Approximately 500 feet    3          +31
                                       east of Avon Allen
                                       Road between Bennett
                                       Road and State Route
                                       536.
Right Bank Overflow Main Stem Skagit  Approximately 400 feet    3          +25  Unincorporated Areas of
 River.                                northeast of the                                   Skagit County.
                                       intersection of
                                       Bennett Road and State
                                       Route 536.
                                      Approximately 500 feet    3          +34
                                       southeast of the
                                       intersection of
                                       Bennett Road and
                                       Silver Lane.
Right Bank Overflow Main Stem Skagit  Approximately 400 feet    3          +32  Unincorporated Areas of
 River.                                west of the                                        Skagit County.
                                       intersection of Pulver
                                       Road and McCorquedale
                                       Road.
                                      Approximately 400 feet    3          +34
                                       east of Pulver Road
                                       between Whitemarsh
                                       Road and McCorquedale
                                       Road.
Right Bank Overflow Main Stem Skagit  At Kamb Road              3          +19  Unincorporated Areas of
 River/North Fork Skagit River.        approximately 0.47                                 Skagit County.
                                       mile south of Calhoun
                                       Road.
                                      Approximately 0.38 mile   3          +20
                                       southeast of the
                                       intersection of
                                       Calhoun Road and Kamb
                                       Road.
Right Bank Overflow North Fork        Just south of Kamb Road   3          +19  Unincorporated Areas of
 Skagit River.                         approximately 0.66                                 Skagit County.
                                       mile east of Beaver
                                       Marsh Road.

                                      Approximately 1,600       3          +19
                                       feet east of the
                                       intersection of Beaver
                                       Marsh Road and Marsh
                                       Road.
Right Bank Overflow South Fork        Between Moore Road and    1          +17  Unincorporated Areas of
 Skagit River.                         Polson Road.                                       Skagit County.
                                      Approximately 870 feet    1          +18
                                       south of Moore Road,
                                       at levee.
Samish Bay..........................  At the intersection of           +12          +13  Unincorporated Areas of
                                       Chuckanut Drive and                                Skagit County.
                                       South Blanchard Drive.
Samish Bay/Padilla Bay..............  At the intersection of           +12          +13  Unincorporated Areas of
                                       Bayview-Edison Road                                Skagit County.
                                       and Samish Island Road.
Simlik Bay..........................  Approximately 0.32 mile         None          +12  Swinomish Indian Tribal
                                       southwest of the                                   Community.
                                       intersection of Snee-
                                       Oosh Road and Snee-
                                       Oosh Lane.
                                      Approximately 100 feet          None          +12
                                       southwest of the
                                       intersection of
                                       Reservation Road and
                                       Simlik Bay Road.
Skagit Bay..........................  Approximately 0.36 mile          +15          +14  Unincorporated Areas of
                                       northwest of the                                   Skagit County.
                                       intersection of
                                       Pioneer Highway and
                                       Milltown Road.
                                      At the confluence of             +17          +14
                                       Ishois Slough and Tom
                                       Moore Slough.
Skagit Bay..........................  Approximately 200 feet          None          +12  Swinomish Indian Tribal
                                       northwest of the                                   Community.
                                       intersection of
                                       Sherman Avenue and
                                       Chilberg Avenue.
                                      Approximately 0.32 mile         None          +12
                                       southwest of the
                                       intersection of Snee-
                                       Oosh Road and Snee-
                                       Oosh Lane.
Skagit Bay..........................  Approximately 400 feet          None          +14  Swinomish Indian Tribal
                                       northwest of Pull and                              Community.
                                       Be Damned Point Road.
                                      Approximately 200 feet          None          +14
                                       southwest of the
                                       intersection of
                                       Sherman Avenue and
                                       Chilberg Avenue.
Skagit Bay/Swinomish Channel........  Approximately 600 feet          None          +12  Swinomish Indian Tribal
                                       southwest of the                                   Community.
                                       intersection of North
                                       Pearle Jensen Way and
                                       East Pearle Jensen Way.
                                      Approximately 400 feet          None          +12
                                       west of Pull and Be
                                       Damned Point Road.
Skagit River........................  Just upstream of the             +49          +52  City of Sedro-Woolley,
                                       Burlington Northern                                Town of Concrete, Town
                                       Railroad.                                          of Hamilton, Town of
                                                                                Lyman, Unincorporated
                                                                                Areas of Skagit
                                                                                County.
                                      Approximately 1.0 mile          +197         +198
                                       upstream of the
                                       confluence with the
                                       Baker River.
Skagit River Delta Overbank Flowpath  Just upstream of Pulver          +27          +32  City of Burlington,
 1.                                    Road.                                              Unincorporated Areas
                                                                                of Skagit County.
                                      Approximately 1,170              +45          +46
                                       feet southeast of the
                                       intersection of
                                       Lafayette Road and
                                       Peter Anderson Road.
Skagit River Delta Overbank Flowpath  At the confluence with           +12          +13  Unincorporated Areas of
 2.                                    Samish Bay.                                        Skagit County.
                                      Just downstream of               +27          +32
                                       Pulver Road.
Skagit River Delta Overbank Flowpath  At the confluence with           +12          +15  Town of La Conner,
 3.                                    the Swinomish Channel.                             Unincorporated Areas
                                                                                of Skagit County.
                                      Just downstream of               +27          +32
                                       Pulver Road.
South Fork Skagit River.............  At the confluence with           +17          +14  Unincorporated Areas of
                                       Ishois Slough and Tim                              Skagit County.
                                       Moore Slough.
                                      At the confluence with           +27          +30
                                       the Main Stem Skagit
                                       River and the North
                                       Fork Skagit River.
Swinomish Channel...................  Just north of Highway           None          +11  Swinomish Indian Tribal
                                       20.                                                Community.
                                      Approximately 600 feet          None          +11
                                       northwest of the
                                       intersection of North
                                       Pearle Jensen Way and
                                       East Pearle Jensen Way.
----------------------------------------------------------------------------------------------------------------
* National Geodetic Vertical Datum.
+ North American Vertical Datum.
 Depth in feet above ground.
[caret] Mean Sea Level, rounded to the nearest 0.1 meter.
* * BFEs to be changed include the listed downstream and upstream BFEs, and include BFEs located on the stream
 reach between the referenced locations above. Please refer to the revised Flood Insurance Rate Map located at
 the community map repository (see below) for exact locations of all BFEs to be changed.

Send comments to Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation
 Administration, Federal Emergency Management Agency, 500 C Street, SW., Washington, DC 20472.
                                                    ADDRESSES
City of Burlington
Maps are available for inspection at City Hall, 833 South Spruce Street, Burlington, WA 98233.

City of Mount Vernon
Maps are available for inspection at City Hall, 910 Cleveland Avenue, Mount Vernon, WA 98273.

City of Sedro-Woolley
Maps are available for inspection at the Planning and Building Department, City Hall, 325 Metcalf Street, Sedro-
 Woolley, WA 98284.

Swinomish Indian Tribal Community
Maps are available for inspection at 11404 Moorage Way, La Conner, WA 98257.
Town of Concrete
Maps are available for inspection at the Town Hall, 45672 Main Street, Concrete, WA 98237.

Town of Hamilton
Maps are available for inspection at the Town Hall, 584 Maple Street, Hamilton, WA 98255.

Town of La Conner
Maps are available for inspection at the Town Hall, 204 Douglas Street, La Conner, WA 98257.

Town of Lyman
Maps are available for inspection at the Town Hall, 8405 South Main Street, Lyman, WA 98263.

                                      Unincorporated Areas of Skagit County
Maps are available for inspection at the Skagit County Department of Planning and Developmental Services, 1800
 Continental Place, Mount Vernon, WA 98273.
----------------------------------------------------------------------------------------------------------------

(Catalog of Federal Domestic Assistance No. 97.022, ``Flood
Insurance.'')

    Dated: February 7, 2011.
Sandra K. Knight,
Deputy Federal Insurance and Mitigation Administrator, Mitigation,
Department of Homeland Security, Federal Emergency Management Agency.
[FR Doc. 2011-5828 Filed 3-11-11; 8:45 am]
BILLING CODE 9110-12-P


AGENDA

FIFRA SCIENTIFIC ADVISORY PANEL (SAP)

OPEN MEETING

February 23 – 25, 2009

FIFRA SAP WEB SITE http://www.epa.gov/scipoly/sap/

OPP Docket Telephone:<PHONE_NUMBER>

Docket Number: EPA-HQ-OPP-2008-0836

U.S. Environmental Protection Agency

Conference Center - Lobby Level

One Potomac Yard (South Bldg.)

2777 S. Crystal Drive, Arlington, VA 22202

Scientific Issues Associated with Evaluation of the Resistance Risks
from Using a Seed Mix Refuge with Pioneer's Optimum AcreMax1 Corn
Rootworm-Protected Corn

Please note that all times are approximate (see note at end of Agenda).

Monday, February 23, 2009

1:30 P.M.	Opening of Meeting and Administrative Procedures – Joseph
Bailey, Designated Federal Official, Office of Science Coordination and
Policy, EPA

1:40 P.M. 	Introduction and Identification of Panel Members – Steven
Heeringa, Ph.D., FIFRA Scientific Advisory Panel Chair

1:50 P.M.	Welcome and Opening Remarks – Steven Bradbury, Ph.D., Deputy
Office Director for Programs, Office of Pesticide Programs, EPA

1:55 P.M.	Welcome and Introductions – Janet Andersen, Director,
Biopesticides and Pollution Prevention Division, Office of Pesticide
Programs, EPA

2:00 P.M.	AcreMax Risk Assessment – Jeannette Martinez, M.S.,
Biopesticides and Pollution Prevention Division, Office of Pesticide
Programs, EPA

3:00 P.M.	Break

3:15 P.M.	Public Comment

5:30 P.M.      ADJOURN

AGENDA

FIFRA SCIENTIFIC ADVISORY PANEL (SAP)

OPEN MEETING

February 23 – 25, 2009

FIFRA SAP WEB SITE http://www.epa.gov/scipoly/sap/

OPP Docket Telephone:<PHONE_NUMBER>

Docket Number: EPA-HQ-OPP-2008-0836

U.S. Environmental Protection Agency

Conference Center - Lobby Level

One Potomac Yard (South Bldg.)

2777 S. Crystal Drive, Arlington, VA 22202

Scientific Issues Associated with Evaluation of the Resistance Risks
from Using a Seed Mix Refuge with Pioneer's Optimum AcreMax1 Corn
Rootworm-Protected Corn

Please note that all times are approximate (see note at end of Agenda).

Tuesday, February 24, 2009

8:30 A.M.	Opening of Meeting and Administrative Procedures – Joseph
Bailey, Designated Federal Official, Office of Science Coordination and
Policy, EPA

8:35 A.M. 	Introduction and Identification of Panel Members – Steven
Heeringa, Ph.D., FIFRA Scientific Advisory Panel Chair

8:45 A.M.      Charge to Panel – Alan Reynolds, M.S., Biopesticides
and Pollution Prevention Divison, Office of Pesticide Programs, EPA

Charge Question 1 -  Pioneer suggested based on their host search
behavior results (MRID 473567-07) that Cry34/35Ab1 protects against corn
rootworm through deterrence and sub-lethal toxicity leading to death by
starvation. Pioneer’s larval recovery study demonstrated high survival
rate of CRW that were exposed to 59122 maize at any stage during their
development but allowed to recover on non-Bt corn (MRID 473567-01).
Conversely, larval exposure to 59122 maize without a recovery phase
resulted in a mortality rate of 0.05 for neonates and 0.01 for 2nd and
3rd instars. BPPD concluded that it cannot be determined whether
mortality or survival occurred due deterrence or some other mechanism.

BPPD would like the panel to discuss whether there is evidence that
repellency or deterrence by 59122 maize could also be described as a
realistic mode of action, specifically for a non-high dose toxin such as
Cry34/35Ab1, and any implications for a seed blend refuge strategy.

10:00 A.M.	BREAK

10:15 A.M. 	Charge to Panel (continued)

Charge Question 2 – Lefko et al. (2008) collected WCR individuals from
two geographically distinct and susceptible populations and introgressed
a non-diapausing trait from a WCR lab strain. The resulting offspring
were selected on 59122 maize for 11 generations. A number of
measurements were taken during the selection experiment to establish the
mean survival rate, fecundity, fertility, and percentage of females
produced for all cohorts of the 11 generations. Multiple greenhouse
experiments were conducted with 4 generations per selected lines to
determine if injury potential changed on 59122 roots. In addition, the
realized heritability (h2= R/S) of the tolerance trait was estimated.
Pioneer speculates that CRW tolerance for 59122 and apparent rarity of
resistance genes in the CRW population may support Lande’s (1983) less
popular hypothesis that “pest adaptation via a major resistance gene
can be prevented or delayed by a minor resistance gene despite strong
selection pressure; rarity of major resistance is an essential condition
for this interaction”.

The Panel is asked to discuss the concept of major vs. minor gene as
hypothesized by Lefko et al. and the implications for selection of
resistance to 59122 and implications for a seed blend strategy.

11:15 A.M.	Charge to Panel (continued)

Charge Question 3 – In BPPD’s review it was concluded that varying
the selection pressure could have identified different resistance genes.
In corn fields across the country the selection pressure will likely be
different and more variable than in the lab because of, for example,
variability in host-pest interactions and environmental conditions.

Please comment on BPPD’s conclusion that different selection
intensities could possibly select different genes, maybe a major
resistance gene. If different selection intensities could possibly
select different genes, maybe a major resistance gene, what does the
Panel think are the implications for resistance evolution to 59122 maize
in a seed blend environment?

12:00 P.M.	LUNCH

1:15 P.M.	Charge to Panel (continued)

Charge Question 4 – In their selection experiment (Lefko et al. 2008),
Pioneer found that heritability of the tolerance trait first increased
and then decreased again. The tolerance trait could not get fixed by
generation 11; Lefko et al. hypothesized that this could be due to an
interaction between two tolerance genes. Pioneer did not address the
potential presence of more than one tolerance gene in the modeling
submission. Furthermore, CRW survival rate due to the tolerance trait
and off-type seed rate (0.00075) was assumed to be half of the survival
rate observed by Nowatzki et al. (2008, MRID 473567-05).

Please comment on whether there is reason to believe that the relative
rate of adaptation could be affected by including more than one minor
gene in the model and whether the assumption of equal survival of
susceptible (AA) individuals with genotype XX (0.0125) and genotypes XY
and YY (0.0125) is realistic.

2:15 P.M.	Charge to Panel (continued)

Charge Question 5 – After having completed the review of the modeling
submission, BPPD has identified several uncertainties and/or weaknesses
of the model. Please comment on which of these uncertainties and/or
modeling weaknesses are important to explore the risk of resistance
evolution to 59122 maize in a seed blend environment.

A. Initial frequency of major resistance gene (0.005) and dominance
(0.05): Pioneer determined initial gene frequency based on the selection
results and modeling comparison conducted in Lefko et al. (2008). Major
resistance was assumed to be almost completely recessive despite the
fact that Cry34/35 does not express a high-dose against CRW.

B. Lack of inclusion of emergence delays: delays of up to 13 days in
initial emergence and eight days in median emergence were observed
between adults from 5% seed blends and 59122 maize. Delays of up to 19
days in initial emergence and 12 days in median emergence were observed
between adults from 100% refuge fields and 59122 maize (MRID 473567-05).

C. Lack of inclusion of uneven sex ratios: the field study (MRID
473567-05) showed that the production of female adult CRW was favored
over the production of male adults, while in the lab study, the
production of males was favored (MRID 473567-01). An inequality in sex
ratios results in a special sort of bottleneck in which random genetic
drift is enhanced and the effective population size is reduced. For
example, if the number of males emerging from Bt plants decreases, then
females emerging early from refuge plants could be more likely to mate
with refuge males rather than 59122 males, especially when one considers
that females have been shown to mate once only.

D. Lack of inclusion of density-dependent dispersal: Hibbard et al.
(2004) reported that in their experiment conducted from 2000-2002, CRW
larval movement was dependent upon egg density per plant (independent of
Bt plants).

E. Lack of inclusion of non-random mating: delayed emergence and uneven
sex ratios are likely to affect the random mating between adult CRW
emerging from refuge maize and adults emerging from 59122 maize.

F. Lack of exploratory modeling: Pioneer’s model did not explore the
production of different percentages of males and females and non-random
mating and, ultimately, their effects on the relative rate of adaptation
to 59122 maize.

3:15 P.M.	Break

3:30 P.M.	Charge to Panel (continued)

Charge Question 6 – The delay in evolution of resistance in
Pioneer’s model when the tolerance gene, major resistance gene, and
off-type seed rate were included was driven by the rapid increase in
frequency of the susceptible genotypes carrying the Y-allele (mostly
AAYY). The proportion of susceptible individuals heterozygous for the
tolerance trait (AAXY) peaked at 0.62 after generation 2; the proportion
of susceptible individuals homozygous for the tolerance trait (AAYY)
reached 0.5 by generation 3. The population was 90% homozygous for the
Y-allele after generation 7 with an interaction emerging between the Y
and B allele around generation 9 when AAYY genotypes declined at a
similar rate to its earlier rate of increase. The proportion of
population homozygous for both the major resistance gene and the
tolerance (BBYY) gene reached 0.5 and 0.9 around generation 17 and 19,
respectively.

Please comment on whether it is realistic to assume that the minor
tolerance trait, specifically the AAYY genotype, might drive the delay
of major resistance to 59122 maize in a seed blend environment.

5:00 P.M.	Adjourn

AGENDA

FIFRA SCIENTIFIC ADVISORY PANEL (SAP)

OPEN MEETING

February 23 – 25, 2009

FIFRA SAP WEB SITE http://www.epa.gov/scipoly/sap/

OPP Docket Telephone:<PHONE_NUMBER>

Docket Number: EPA-HQ-OPP-2008-0836

U.S. Environmental Protection Agency

Conference Center - Lobby Level

One Potomac Yard (South Bldg.)

2777 S. Crystal Drive, Arlington, VA 22202

Scientific Issues Associated with Evaluation of the Resistance Risks
from Using a Seed Mix Refuge with Pioneer's Optimum AcreMax1 Corn
Rootworm-Protected Corn

Please note that all times are approximate (see note at end of Agenda).

Wednesday, February 25, 2009

8:30 A.M.	Opening of Meeting and Administrative Procedures – Joseph
Bailey, Designated Federal Official, Office of Science Coordination and
Policy, EPA

8:35 A.M. 	Introduction and Identification of Panel Members – Steven
Heeringa, Ph.D., Scientific Advisory Panel Chair

8:45 A.M. 	Charge to Panel (continued) - Alan Reynolds, M.S.,
Biopesticides and Pollution Prevention Divison, Office of Pesticide
Programs, EPA

end (≥2%) for corn rootworm, all the supporting studies, and the model
with its general assumptions, parameters and their values, as well as
modeling analyses and concludes the following: At this point, BPPD
believes that the proposed seed blend of ≥2% for Optimum® AcreMax™
1 Insect Protection has many uncertainties with respect to biological
and genetic parameters and lack of exploratory modeling. BPPD believes
these uncertainties must be resolved before a seed blend refuge is a
viable long-term alternative to a structured refuge for corn rootworm.
In the interim, BPPD has concluded that no less than 10% refuge seed
blend is appropriate. BPPD bases its conclusion on: 1) the Relative Rate
of Adaptation (RRA) at the 10% refuge proportion (value ~ 0.7) compared
to the higher RRA values at lower proportions of refuge as estimated in
Pioneer’s model (MRID 473567-08), 2) root protection results for the
10% seed blend (Nowatzki and Meinke, 2008, MRID 473567-06), 3) efficacy
results (Davis and MacIntosh, 2008, MRID 473567-10), 4) CRW emergence
curve similarities for the 10% seed blend and 100% refuge maize
(Nowatzki et al., 2008, MRID 473567-05), 5) similarity in fitness
results between females emerging from the 10% seed blend and the 100%
refuge maize, and 6) modeling uncertainties.

7

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ᔦݨ굡ᘀ덨ॸ㘀脈䩃 䩏䩑࡝庁Ɋ愀ᑊሀotected maize given
the uncertainties and what is currently known about CRW biology,
ecology, and genetics.

10:00 A.M.	Break

10:15 A.M.	Charge to Panel (continued as needed)

12:00 P.M.	Adjourn

Please be advised that agenda times are approximate; when the discussion
for one topic is completed, discussions for the next topic will begin.
For further information, please contact the Designated Federal Official
for this meeting, Joseph Bailey, via telephone:<PHONE_NUMBER>; fax:
(202) 564-8382; or email<EMAIL_ADDRESS>

 PAGE

 PAGE   5


[Federal Register Volume 85, Number 70 (Friday, April 10, 2020)]
[Rules and Regulations]
[Page 20165]
[FR Doc No: 2020-06994]

=======================================================================
-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R01-OAR-2020-0029; FRL-10007-63-Region 1]

Air Plan Approval; New Hampshire; Approval of Single Source
Order; Withdrawal of Direct Final Rule

AGENCY: Environmental Protection Agency (EPA).

ACTION: Withdrawal of direct final rule.

-----------------------------------------------------------------------

SUMMARY: Due to the receipt of an adverse comment, the Environmental
Protection Agency (EPA) is withdrawing the February 14, 2020 direct
final rule approving a State Implementation Plan (SIP) revision
submitted by the State of New Hampshire. New Hampshire's SIP revision
established an Order reducing emissions of volatile organic chemicals
from PSI Molded Plastics. This action is being taken in accordance with
the Clean Air Act.

DATES: The direct final rule published at 85 FR 8408 on February 14,
2020 is withdrawn effective April 10, 2020.

FOR FURTHER INFORMATION CONTACT: Bob McConnell, Environmental Engineer,
Air and Radiation Division (Mail Code 05-2), U.S. Environmental
Protection Agency, Region 1, 5 Post Office Square, Suite 100, Boston,
Massachusetts 02109-3912;<PHONE_NUMBER><EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: In the direct final rule, EPA stated that if
adverse comments were submitted by March 16, 2020, the rule would be
withdrawn and not take effect. EPA received an adverse comment prior to
the close of the comment period and, therefore, is withdrawing the
direct final rule. EPA will address the comment in a subsequent final
action based upon the proposed rule also published on February 14, 2020
(85 FR 8520). EPA will not institute a second comment period on this
action.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by
reference, Ozone, Reporting and recordkeeping requirements, Volatile
organic compounds.

    Dated: March 30, 2020.
Dennis Deziel,
Regional Administrator, EPA Region 1.

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

    Accordingly, the amendments to 40 CFR 52.1520 published on February
14, 2020 (85 FR 8408), are withdrawn effective April 10, 2020.

[FR Doc. 2020-06994 Filed 4-9-20; 8:45 am]
 BILLING CODE 6560-50-P


[Federal Register Volume 85, Number 127 (Wednesday, July 1, 2020)]
[Notices]
[Pages 39613-39619]
[FR Doc No: 2020-14115]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-89154; File No. SR-MSRB-2020-02]

Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Order Granting Approval of a Proposed Rule Change To Align
Certain MSRB Rules to Securities Exchange Act Rule 15 l -1, Regulation
Best Interest

June 25, 2020.

I. Introduction

    On May 1, 2020, the Municipal Securities Rulemaking Board (the
``MSRB'' or ``Board'') filed with the Securities and Exchange
Commission (the ``SEC'' or ``Commission''), pursuant to Section
19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule
19b-4 thereunder,\2\ a proposed rule change to align MSRB rules to the
Commission's recently adopted Rule 15l-1 under the Exchange Act
(``Regulation Best Interest''); \3\ specifically, amendments to MSRB
Rule G-8 (on books and records), MSRB Rule G-9 (on preservation of
records), MSRB Rule G-19 (on suitability of recommendations and
transactions), MSRB Rule G-20 (on gifts, gratuities, non-cash
compensation and expenses of issuance), MSRB Rule G-48 (on transactions
with Sophisticated Municipal Market Professionals (``SMMPs'')), and the
deletion of an interpretation of MSRB Rule G-20 (the ``proposed rule
change'').
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 17 CFR 240.15 l -1; see also Exchange Act Release No. 86031
(June 5, 2019), 84 FR 33318 (July 12, 2019) (File No. S7-07-18)
(``Regulation Best Interest Adopting Release'').
---------------------------------------------------------------------------

    The proposed rule change was published for comment in the Federal
Register on May 12, 2020.\4\ The public comment period closed on June
2, 2020.\5\ As described further below, the Commission is approving the
proposed rule change.
---------------------------------------------------------------------------

    \4\ Securities Exchange Act Release No. 88829 (May 6, 2020) (the
``Notice''), 85 FR 28082 (May 12, 2020) (MSRB-2020-02).
    \5\ All comment letters received on the proposed rule change are
available on the Commission's website at https://www.sec.gov.
---------------------------------------------------------------------------

II. Description of Proposed Rule Change

    As described further below, the MSRB proposed to align MSRB rules
with Regulation Best Interest by revising the MSRB's rules to comport
with Regulation Best Interest obligations involving: (i) Suitability,
by amending MSRB Rule G-19 to apply only in circumstances in which
Regulation Best Interest does not apply and eliminate the control
element from the quantitative suitability obligation for
recommendations subject to MSRB Rule G-19, and MSRB Rule G-48 to make
clear that the exception from the requirement to perform a customer-
specific suitability analysis when making a recommendation to a
Sophisticated Municipal Market Participant (``SMMP'') (as defined in
MSRB Rule D-15) is available only for recommendations that are subject
to MSRB Rule G-19; (ii) non-cash compensation, by updating MSRB Rule G-
20 to require any permissible non-cash compensation to align with the
applicable requirements of Regulation Best Interest; and (iii) books
and records, by requiring dealers to maintain books and records
required by Regulation Best Interest and the related SEC Form CRS
requirement through revisions to MSRB Rules G-8 and G-9.

A. Background

    On June 5, 2019, the SEC adopted Regulation Best Interest, which
establishes a new standard of conduct for Broker-Dealers \6\ and
natural persons who are associated persons of a Broker-Dealer.
---------------------------------------------------------------------------

    \6\ Under Regulation Best Interest, ``broker-dealers'' are
defined as ``broker-dealers and natural persons who are associated
persons of a broker-dealer (unless otherwise indicated, together
referred to as ``broker-dealer[s]''). Regulation Best Interest
Adopting Release, 84 FR at 33318. Each broker-dealer subject to
Regulation Best Interest is referred to herein as a ``Broker-
Dealer'' and, collectively as ``Broker-Dealers.''
---------------------------------------------------------------------------

    Specifically, this standard of conduct for a Broker-Dealer applies
when making a recommendation to a retail customer, defined generally as
a natural person or the legal representative of such person, who
receives and uses a recommendation from a Broker-Dealer primarily for
personal, family, or household purposes, of any securities transaction
or investment strategy involving securities.\7\ The Commission

stated that Regulation Best Interest enhances the Broker-Dealer
standard of conduct beyond existing suitability obligations, and aligns
the standard of conduct with retail customers' reasonable expectations
by imposing certain new requirements on Broker-Dealers.\8\
Specifically, Regulation Best Interest imposes the following ``general
obligation'' on Broker-Dealers:
---------------------------------------------------------------------------

    \7\ Id.
    \8\ Regulation Best Interest Adopting Release, 84 FR at 33319.

    [W]hen making a recommendation of any securities transaction or
investment strategy involving securities (including account
recommendations) to a retail customer, shall act in the best
interest of the retail customer at the time the recommendation is
made, without placing the financial or other interest of the
[Broker-Dealer] making the recommendation ahead of the interest of
the retail customer.\9\
---------------------------------------------------------------------------

    \9\ 17 CFR 240.15l -1(a)(1).

    Regulation Best Interest \10\ provides that this general obligation
is satisfied only if a Broker-Dealer complies with four component
obligations: (i) An obligation to make certain prescribed disclosures,
before or at the time of the recommendation, about the recommendation
and the relationship between the retail customer and the Broker-Dealer
(the ``Disclosure Obligation''); \11\ (ii) an obligation to exercise
reasonable diligence, care, and skill in making a recommendation (the
``Care Obligation''); \12\ (iii) an obligation to establish, maintain,
and enforce written policies and procedures reasonably designed to
address conflicts of interest (the ``Conflict of Interest
Obligation''); \13\ and (iv) an obligation to establish, maintain, and
enforce written policies and procedures reasonably designed to achieve
compliance with Regulation Best Interest (the ``Compliance
Obligation'').\14\
---------------------------------------------------------------------------

    \10\ SEC staff frequently asked questions on Regulation Best
Interest are available at: https://www.sec.gov/tm/faq-regulation-best-interest.
    \11\ 17 CFR 240.15l-1(a)(2)(i).
    \12\ 17 CFR 240.15l-1(a)(2)(ii).
    \13\ 17 CFR 240.15l-1(a)(2)(iii).
    \14\ 17 CFR 240.15l-1(a)(2)(iv).
---------------------------------------------------------------------------

    The MSRB stated that the following changes to its rules reflect its
attempt to harmonize the MSRB's rules with Regulation Best Interest and
Form CRS and reduce the potential for conflicting or duplicative
regulation in the municipal securities market among Dealers.\15\
---------------------------------------------------------------------------

    \15\ To effect transactions in municipal securities, a person
must be a Broker-Dealer subject to registration with the Commission
under Section 15(b)(1) or a municipal securities dealer subject to
registration with the Commission under Section 15B(a)(2) of the
Exchange Act. See 15 U.S.C. 78f(b)(1); 15 U.S.C. 78o-4(b)(2)(C).
    With respect to municipal securities dealers subject to
registration under Section 15B(a)(2) of the Exchange Act, MSRB Rule
D-8 provides that ``a municipal securities dealer which is a bank or
a separately identifiable department or division of a bank'' is a
bank dealer (``Bank Dealer''). As used herein, a Bank Dealer,
together with a Broker-Dealer is a ``Dealer.''
    Bank Dealers are registered with the Commission under Exchange
Section 15B(a)(2), and thus are not subject to Regulation Best
Interest. Nevertheless, because Bank Dealers can make
recommendations of municipal securities transactions or investment
strategies involving municipal securities to retail customers, the
Board stated it plans to issue a separate Request for Comment on
whether the Board will apply the requirements of Regulation Best
Interest, through further amendments to MSRB rules, to Bank Dealers.
See Notice, 85 FR at 28083 n.5.
---------------------------------------------------------------------------

B. Suitability

i. MSRB Rule G-19
    MSRB Rule G-19 provides that a Dealer must have a reasonable basis
to believe that a recommended transaction or investment strategy
involving municipal securities is suitable for the customer, based on
the information obtained through the reasonable diligence of the Dealer
to ascertain the customer's investment profile.\16\ The MSRB Rule G-19
suitability standard is composed of three component obligations:
---------------------------------------------------------------------------

    \16\ MSRB Rule G-19 defines a customer's investment profile to
include the customer's age, other investments, financial situation
and needs, tax status, investment objectives, investment experience,
investment time horizon, liquidity needs, risk tolerance, and any
other information the customer may disclose to the dealer in
connection with such recommendation.

    1. Reasonable-basis suitability, which requires a dealer to have
a reasonable basis to believe, based on reasonable diligence, that
the recommendation is suitable for at least some investors; \17\
---------------------------------------------------------------------------

    \17\ MSRB Rule G-19, Supplementary Material .05(a).
---------------------------------------------------------------------------

    2. Customer-specific suitability, which requires a dealer to
have a reasonable basis to believe that the recommendation is
suitable for a particular customer based on that customer's
investment profile; \18\ and
---------------------------------------------------------------------------

    \18\ MSRB Rule G-19, Supplementary Material .05(b).
---------------------------------------------------------------------------

    3. Quantitative suitability, which requires a dealer who has
actual or de facto control over a customer account to have a
reasonable basis for believing that a series of recommended
transactions, even if suitable when viewed in isolation, are not
excessive and unsuitable for the customer when taken together in
light of the customer's investment profile.\19\
---------------------------------------------------------------------------

    \19\ MSRB Rule G-19(c).

    MSRB Rule G-19 applies to all Dealers when making a recommendation
to a ``customer,'' which is defined in MSRB Rule D-9 as any person
other than a Dealer acting in its capacity as a Dealer or an issuer in
transactions involving the sale of a new issue of its securities.\20\
When a Dealer reasonably concludes that a customer is an SMMP,\21\ such
Dealer is not obligated to perform a customer-specific suitability
analysis under MSRB Rule G-19.\22\
---------------------------------------------------------------------------

    \20\ MSRB Rule D-9 states that, ``Except as otherwise
specifically provided by rule of the Board, the term `customer'
shall mean any person other than a broker, dealer, or municipal
securities dealer acting in its capacity as such or an issuer in
transactions involving the sale by the issuer of a new issue of its
securities.''
    \21\ MSRB Rule D-15 defines a customer as an SMMP according to
three elements:
    (a) Nature of the Customer. The customer must be:
    (1) a bank, savings and loan association, insurance company, or
registered investment company;
    (2) an investment adviser registered either with the Commission
under Section 203 of the Investment Advisers Act of 1940 or with a
state securities commission (or any agency or office performing like
functions); or
    (3) any other person or entity with total assets of at least $50
million.
    (b) Dealer Determination of Customer Sophistication. The dealer
must have a reasonable basis to believe that the customer is capable
of evaluating investment risks and market value independently, both
in general and with regard to particular transactions and investment
strategies in municipal securities.
    (c) Customer Affirmation. The customer must affirmatively
indicate that it:
    (1) Is exercising independent judgment in evaluating:
    (A) the recommendations of the dealer;
    (B) the quality of execution of the customer's transactions by
the dealer; and
    (C) the transaction price for non-recommended secondary market
agency transactions as to which (i) the dealer's services have been
explicitly limited to providing anonymity, communication, order
matching and/or clearance functions and (ii) the dealer does not
exercise discretion as to how or when the transactions are executed;
and
    (2) has timely access to material information that is available
publicly through established industry sources as defined in Rule G-
47(b)(i) and (ii).
    \22\ MSRB Rule G-48(c).
---------------------------------------------------------------------------

    Conceptually similar to MSRB Rule G-19, the Care Obligation of
Regulation Best Interest also requires a three-part analysis to
evaluate recommendations to retail customers but employs the higher
best interest standard instead of MSRB Rule G-19's suitability
standard.\23\ In addition, while Regulation Best Interest applies only
to recommendations to ``retail customers,'' defined generally as a
natural person or the legal representative of such person, who receives
and uses a recommendation from a Broker-Dealer primarily for personal,
family, or household purposes,\24\ MSRB Rule G-19 applies to
``customers'' (with an exception to the customer-specific suitability
requirement for recommendations to SMMPs).\25\
---------------------------------------------------------------------------

    \23\ See Notice, 85 FR at 28084.
    \24\ See 17 CFR 240.15l-1(b)(1).
    \25\ See Notice, 85 FR at 28084.
---------------------------------------------------------------------------

    The proposed rule change includes two amendments to MSRB Rule G-19
designed to harmonize MSRB

requirements with Regulation Best Interest.\26\ First, to avoid
unnecessary regulatory complexity, the applicability of MSRB Rule G-19
would be limited only to circumstances in which Regulation Best
Interest does not apply.\27\ Second, the proposed rule change would
remove the existing limitation in MSRB Rule G-19 that requires a
quantitative suitability determination only when a Dealer has ``actual
or de facto control'' over the customer's account.\28\ These proposed
amendments are discussed below.
---------------------------------------------------------------------------

    \26\ Id.
    \27\ Id.
    \28\ Id.
---------------------------------------------------------------------------

a. Eliminate Applicability of MSRB Rule G-19 to Recommendations Subject
to Regulation Best Interest
    The MSRB stated that Regulation Best Interest addresses generally
the same conduct that is addressed by MSRB Rule G-19 but employs a best
interest, rather than a suitability, standard. The MSRB also stated
that, absent action by the Board, a Broker-Dealer would be required to
reconcile compliance with both Regulation Best Interest and MSRB Rule
G-19 in many circumstances.\29\ In such circumstances, the MSRB
believed that compliance with Regulation Best Interest would result in
compliance with MSRB Rule G-19 because a Broker-Dealer that ``act[s] in
the best interest of the retail customer'' \30\ when making a
recommendation to a retail customer of any securities transaction or
investment strategy involving securities would necessarily also meet
the MSRB Rule G-19 requirement to ``have a reasonable basis to believe
that [the recommendation] is suitable for the customer.'' \31\
---------------------------------------------------------------------------

    \29\ Id.
    \30\ 17 CFR 240.15l-1(a)(1).
    \31\ See Notice, 85 FR at 28084.
---------------------------------------------------------------------------

    The MSRB stated that the proposed rule change reduces the potential
for duplicative regulation and unnecessary complexity and provides
regulatory clarity about the applicability and requirements of MSRB
Rule G-19 and Regulation Best Interest to market participants in an
effective and efficient manner.\32\ In particular, the proposed rule
change adds new text to MSRB Rule G-19 that states that MSRB Rule G-19
does not apply to recommendations subject to Regulation Best
Interest.\33\ MSRB Rule G-19 would thus apply only to:
---------------------------------------------------------------------------

    \32\ Id.
    \33\ Id.

    1. Recommendations to customers that are not ``retail
customers,'' \34\ as defined by Regulation Best Interest; and
---------------------------------------------------------------------------

    \34\ Regulation Best Interest defines a retail customer as a
natural person, or the legal representative of such natural person,
who receives a recommendation of any securities transaction or
investment strategy involving securities from a broker-dealer and
uses the recommendation primarily for personal, family, or household
purposes. See 17 CFR 240.15l-1(b)(1).
---------------------------------------------------------------------------

    2. Recommendations to any customers by Bank Dealers.\35\
---------------------------------------------------------------------------

    \35\ As noted above, the MSRB plans to issue a Request for
Comment on whether the MSRB will apply the requirements of
Regulation Best Interest to Bank Dealers through further amendments
to MSRB rules. See Notice, 85 FR at 28083 n.5.
---------------------------------------------------------------------------

b. Align MSRB Rule G-19's Quantitative Suitability Obligation to the
Requirements of Regulation Best Interest
    MSRB Rule G-19's quantitative suitability obligation requires a
Dealer to have a reasonable basis for believing that a series of
recommended transactions are not excessive and unsuitable for the
customer when taken together in light of the customer's profile, but
only if the Dealer has actual or de facto control over the customer's
account.\36\ In contrast, the quantitative care obligation of
Regulation Best Interest applies regardless of whether the Broker-
Dealer exercises actual or de facto control over the customer's
account.\37\ In the Regulation Best Interest Adopting Release, the
Commission stated:
---------------------------------------------------------------------------

    \36\ MSRB Rule G-19, Supplementary Material .05(c).
    \37\ See 17 CFR 240.15l-1(a)(2)(ii)(C); see also Regulation Best
Interest Adopting Release, 84 FR at 33327.

    [I]mposing the quantitative care obligation without a
``control'' element would provide consistency in the investor
protections provided to retail customers by requiring a broker-
dealer to always form a reasonable basis as to the recommended
frequency of trading in a retail customer's account--irrespective of
whether the broker-dealer ``controls'' or exercises ``de facto
control'' over the retail customer's account. This would also be
consistent with the other obligations of the Care Obligation, which
apply regardless of whether a broker-dealer ``controls'' or
exercises ``de facto control'' over the retail customers'
account.\38\
---------------------------------------------------------------------------

    \38\ Regulation Best Interest Adopting Release, 84 FR at 33384
(citation omitted).

The MSRB offered the same rationale eliminating the control element of
the quantitative suitability obligation prescribed in Supplementary
Material .05(c) of MSRB Rule G-19.\39\
---------------------------------------------------------------------------

    \39\ See Notice, 85 FR at 28084.
---------------------------------------------------------------------------

ii. MSRB Rule G-48
    MSRB Rule G-48(c) provides that a Dealer making a municipal
securities recommendation to an SMMP does not have any obligation under
MSRB Rule G-19 to perform a customer-specific suitability analysis.\40\
Under MSRB Rule D-15, an SMMP is defined by three components:
---------------------------------------------------------------------------

    \40\ Id.

    1. The customer must fit within a prescribed category of
institutional investor or be a natural person or entity with total
assets of at least $50 million; \41\
---------------------------------------------------------------------------

    \41\ MSRB Rule D-15(a).
---------------------------------------------------------------------------

    2. The dealer must have a reasonable basis to believe that the
customer is capable of evaluating investment risks and market value
independently; \42\ and
---------------------------------------------------------------------------

    \42\ MSRB Rule D-15(b).
---------------------------------------------------------------------------

    3. The customer must make certain affirmations regarding the
exercise of independent judgment and access to information.\43\
---------------------------------------------------------------------------

    \43\ MSRB Rule D-15(c).

As provided in MSRB Rule G-48(c), a Dealer making a recommendation to a
natural person with at least $50 million in assets and who otherwise
meets the definition of SMMP, shall not have an obligation under MSRB
Rule G-19 to perform a customer-specific suitability analysis.\44\
---------------------------------------------------------------------------

    \44\ See Notice, 85 FR at 28085.
---------------------------------------------------------------------------

    Though as discussed above in Section II(B)(i)(a), the proposed rule
change would exclude the recommendations of Broker-Dealers to retail
customers from the scope of MSRB Rule G-19, the MSRB also proposes to
amend MSRB Rule G-48(c) to make clear that the exception contained
therein from the obligation to conduct a customer-specific suitability
analysis only applies when a recommendation is subject to MSRB Rule G-
19 and not Regulation Best Interest.\45\ As the MSRB stated in its
Notice, there is no exception from the customer-specific care
obligation for high-net worth individuals.\46\
---------------------------------------------------------------------------

    \45\ Id.
    \46\ Id.
---------------------------------------------------------------------------

C. Non-Cash Compensation

    MSRB Rule G-20(g) broadly prohibits Dealers and their associated
persons from directly or indirectly accepting or making payments or
offers of payments of any non-cash compensation in connection with the
sale and distribution of a primary offering of municipal securities,
subject to certain limited exceptions.\47\ The MSRB stated that
described generally, these exceptions are:
---------------------------------------------------------------------------

    \47\ Id.

    1. Gifts that do not exceed $100 per individual per year and are
not preconditioned on achievement of a sales target; \48\
---------------------------------------------------------------------------

    \48\ MSRB Rule G-20(d)(i).
---------------------------------------------------------------------------

    2. Occasional gifts of meals or tickets to theatrical, sporting,
and other entertainments, provided that such gifts are

not so frequent or so extensive as to raise any question of
propriety and are not preconditioned on achievement of a sales
target; \49\
---------------------------------------------------------------------------

    \49\ MSRB Rule G-20(d)(ii).
---------------------------------------------------------------------------

    3. Payment or reimbursement by offerors (generally, the issuer
and any advisors to the issuer, the underwriters, and their
affiliates) in connection with training or education meetings,
subject to specified conditions, including that the payment is not
conditioned on achieving a sales target; \50\
---------------------------------------------------------------------------

    \50\ MSRB Rule G-20(d)(iii).
---------------------------------------------------------------------------

    4. Internal non-cash compensation arrangements between the
dealer and its associated persons, subject to specified conditions
including that any non-cash compensation related to a sales contest
must be based on the total production of all associated persons with
respect to all municipal securities within respective product types
distributed by the dealer and credit for those sales must be
weighted equally; \51\ and
---------------------------------------------------------------------------

    \51\ MSRB Rule G-20(d)(iv).
---------------------------------------------------------------------------

    5. Contributions by any person other than the dealer to a non-
cash compensation arrangement between a dealer and its associated
persons, subject to the same conditions for permissible internal
non-cash compensation arrangements, described above.\52\
---------------------------------------------------------------------------

    \52\ MSRB Rule G-20(d)(v).

    Regulation Best Interest's Conflict of Interest Obligation
requires, among other things, Broker-Dealers to establish, maintain and
enforce written policies and procedures reasonably designed to, among
other things, identify and eliminate sales contests, sales quotas,
bonuses, and non-cash compensation that are based on the sale of
specific securities or specific types of securities within a limited
period of time.\53\ As described above, MSRB Rule G-20 permits certain
sales contests in connection with primary offerings.\54\ The proposed
rule change clarifies that any non-cash compensation permitted by MSRB
Rule G-20(g), including any sales contests, must also be consistent
with the applicable requirements of Regulation Best Interest.\55\
---------------------------------------------------------------------------

    \53\ 17 CFR 240.15l-1(a)(2)(iii)(D). The Conflict of Interest
Obligation also requires broker-dealers to (1) identify and at a
minimum disclose or eliminate all conflicts of interest associated
with a recommendation of any securities transaction or investment
strategy involving securities to a retail customer; (2) identify and
mitigate any conflicts of interest associated with such
recommendations that create an incentive for a natural person who is
an associated person of a broker-dealer to place the interest of the
broker-dealer or such natural person ahead of the interest of the
retail customer; and (3) identify and disclose any material
limitations placed on the securities or investment strategies
involving securities that may be recommended to a retail customer
and any conflicts of interest associated with such limitations and
prevent such limitations and associated conflicts of interest from
causing the broker-dealer, or a natural person who is an associated
person of the broker-dealer, to make recommendations that place the
interest of the broker-dealer or such natural person ahead of the
interest of the retail customer. 17 CFR 240.15l -1(a)(3)(A)-(C).
    \54\ See Notice, 85 FR at 28085.
    \55\ Id.
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    Additionally, in June 1982, the MSRB published interpretive
guidance under MSRB Rule G-20 stating that sales contests offered by an
underwriter to participating members of a syndicate constitute
compensation for services and, therefore, must meet the requirements of
the then-current version of MSRB Rule G-20.\56\ The proposed rule
change deletes the 1982 Guidance.\57\ The MSRB noted that, depending on
the particular facts and circumstances, such sales contests, with
respect to Dealers that make recommendations to retail customers, may
be inconsistent with the requirements of Regulation Best Interest's
Conflict of Interest Obligation, which requires Broker-Dealers to
establish, maintain and enforce written policies and procedures
reasonably designed to ``[i]dentify and eliminate any sales contests,
sales quotas, bonuses, and non-cash compensation that are based on the
sales of specific securities or specific types of securities within a
limited period of time.'' \58\ In support of its decision to rescind
the 1982 Guidance, the MSRB quoted the following from the Commission's
Adopting Release for Regulation Best Interest:
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    \56\ See Rule G-20 Interpretive Guidance, ``Authorization of
Sales Contests'' (June 25, 1982) (``1982 Guidance'').
    \57\ See Notice, 85 FR at 28085.
    \58\ See 17 CFR 240.15l -1(a)(2)(iii).

    [s]ales contests, sales quotas, bonuses and non-cash
compensation that are based on the sales of specific securities
within a limited period of time create high-pressure situations for
associated persons to increase the sales of specific securities or
specific types of securities within a limited period of time and
thus compromise the best interests of their retail customers.\59\
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    \59\ Regulation Best Interest Adopting Release, 84 FR at 33331.

Deciding to rescind the 1982 Guidance for all recommendations of
municipal securities transactions made by Dealers to all customers, the
MSRB stated that the same policy concerns apply with respect to non-
retail customers.\60\ Specifically, the MSRB stated that the high-
pressure sales situations described above have the potential to
compromise the best interests of non-retail customers as well.
Accordingly, the proposed rule change deletes this interpretation in
full.\61\
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    \60\ See Notice, 85 FR at 28085.
    \61\ Id.
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D. Books and Records

i. MSRB Rule G-8
    MSRB Rule G-8 directs Dealers to make and keep current specified
books and records to the extent they are applicable to a Dealer's
business.\62\ For Dealers subject to Exchange Act Rule 17a-3, MSRB Rule
G-8(f) provides that compliance with Exchange Act Rule 17a-3 will be
deemed compliance with MSRB Rule G-8, provided that certain records
required by MSRB Rule G-8 must be maintained in any event. Exchange Act
Rule 17a-3 requires Broker-Dealers to make and keep current specified
books and records and provides that for purposes of transactions in
municipal securities by Dealers, compliance with MSRB Rule G-8 will be
deemed compliance with Exchange Act Rule 17a-3.\63\
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    \62\ See Notice, 85 FR at 28085-6.
    \63\ 17 CFR 240.17a-3.
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    When the Commission adopted Regulation Best Interest, it amended
Exchange Act Rule 17a-3 to require Broker-Dealers to maintain a record
of all information collected from and provided to a retail customer
pursuant to Regulation Best Interest, along with the identity of each
natural person who is an associated person, if any, responsible for the
account.\64\ The Commission also adopted a related requirement for
Broker-Dealers to provide retail investors with Form CRS \65\ and
amended Exchange Act Rule 17a-3 to require Broker-Dealers to maintain a
record of the date it provided each Form CRS to its retail
customers.\66\
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    \64\ 17 CFR 240.17a-3(a)(35).
    \65\ 17 CFR 240.17a-14.
    \66\ 17 CFR 240.17a-3(a)(24).
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    The MSRB stated that the proposed rule change includes amendments
to MSRB Rule G-8 that parallel the new Exchange Act Rule 17a-3
requirements relating to Regulation Best Interest and Form CRS because
Broker-Dealers may comply with Exchange Act Rule 17a-3 for purposes of
transactions in municipal securities by complying with MSRB Rule G-
8.\67\ Specifically, the proposed rule change requires that each
Broker-Dealer shall make and keep current in its books and records: (i)
Under proposed MSRB Rule G-8(a)(xi)(F), a record of all information
collected from, and provided to, a retail customer (as well as the
identify of each natural person who is an associated person, if any,
responsible for the account), to whom a recommendation of any
securities transaction or investment strategy involving municipal
securities is or will be provided; and (ii) under

proposed MSRB Rule G-8(a)(xxvii), a record of the date that each Form
CRS was provided to each retail investor (including any Form CRS before
any such retail investor opens an account).\68\ The MSRB stated it
believes that the proposed rule change's amendments are necessary to
ensure that Broker-Dealers subject to Regulation Best Interest and the
Form CRS requirement are required to maintain the records regardless of
which books and records rule they follow.\69\
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    \67\ See Notice, 85 FR at 28086.
    \68\ Id.
    \69\ Id.
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ii. MSRB Rule G-9
    MSRB Rule G-9 prescribes the periods of time that records must be
preserved by Dealers.\70\ Similar to MSRB Rule G-8, MSRB Rule G-9
provides that Dealers who are subject to and comply with Exchange Act
Rules 17a-3 and 17a-4 will be deemed to comply with MSRB Rule G-9,
provided that certain specified records are preserved for the
applicable time periods specified in Rule G-9 in any event.\71\
Exchange Act Rule 17a-4 establishes record preservation requirements
for Broker-Dealers and, like Exchange Act Rule 17a-3, provides that for
purposes of transactions in municipal securities by Dealers, compliance
with MSRB Rule G-9 will be deemed compliance with Exchange Act Rule
17a-4.\72\
---------------------------------------------------------------------------

    \70\ Id.
    \71\ Id.
    \72\ Id.
---------------------------------------------------------------------------

    The Commission amended Exchange Act Rule 17a-4 to require Broker-
Dealers to retain the records related to Regulation Best Interest and
Form CRS described above for six years.\73\ The MSRB stated that the
proposed rule change includes amendments to MSRB Rule G-9 to parallel
these new requirements.\74\ Specifically, this proposed rule change
requires preserving copies of: (i) All documents required under MSRB
Rule G-8(a)(xi)(F) (until at least six years after the earlier of the
date the account was closed or the date on which the information was
collected, provided, replaced, or updated); and (ii) the records
concerning Form CRS (required to be maintained pursuant to Rule G-
8(a)(xxvii)); and (iii) a copy of each Form CRS, until at least six
years after such record or Form CRS is created.\75\ The MSRB stated
that the proposed rule change's revisions to MSRB G-9 are necessary to
ensure that Broker-Dealers are subject to similar requirements, whether
under MSRB rules or the rules of the SEC.\76\
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    \73\ 17 CFR 240.17a-4(e)(5), (e)(10).
    \74\ See Notice, 85 FR at 28086.
    \75\ Id.
    \76\ Id.
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III. Discussion and Commission Findings

    The Commission has carefully considered the proposed rule change
and the comment letters received. The Commission finds that the
proposed rule change is consistent with the requirements of the
Exchange Act and the rules and regulations thereunder applicable to the
MSRB.
    In particular, the Commission believes that the proposed rule
change is consistent with the provisions of Exchange Act Section
15B(b)(2)(C), which provides, in part, that the MSRB's rules shall:

    [B]e designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to
foster cooperation and coordination with persons engaged in
regulating, clearing, settling, processing information with respect
to, and facilitating transactions in municipal securities and
municipal financial products, and to remove impediments to and
perfect the mechanism of a free and open market in municipal
securities and municipal financial products, and, in general, to
protect investors, municipal entities, obligated persons, and the
public interest.\77\
---------------------------------------------------------------------------

    \77\ 15 U.S.C. 78o-4(b)(2)(C).
---------------------------------------------------------------------------

A. Amendments Related to Suitability

    The Commission finds that the proposed rule change's proposed
amendments to MSRB Rules G-19 and G-48 are consistent with Exchange Act
Section 15B(b)(2)(C) because the amendments will foster cooperation and
coordination with regulators, facilitate transactions in municipal
securities and municipal financial products, remove impediments to and
perfect the mechanism of a free and open market in municipal securities
and municipal financial products, and protect investors.\78\
---------------------------------------------------------------------------

    \78\ Id.
---------------------------------------------------------------------------

i. Eliminating the Applicability of MSRB Rule G-19 to Recommendations
Subject to Regulation Best Interest
    The Commission believes that the proposed rule change's revision to
MSRB Rule G-19 will protect investors by ensuring Broker-Dealers comply
with the heightened regulatory requirements of the Commission's
Regulation Best Interest. As stated by the Commission in the Regulation
Best Interest Adopting Release:

    The enhancements contained in Regulation Best Interest are
designed to improve investor protection by enhancing the quality of
broker-dealer recommendations to retail customers and reducing the
potential harm to retail customers that may be caused by conflicts
of interest.\79\
---------------------------------------------------------------------------

    \79\ Regulation Best Interest Adopting Release, 83 FR at 33321.

    The Commission also finds that the proposed rule change's revisions
to MSRB Rule G-19 to eliminate the applicability of MSRB Rule G-19's
suitability requirements to recommendations subject to Regulation Best
Interest will foster cooperation and coordination with regulators by
harmonizing MSRB rules with Regulation Best Interest. The Commission
also believes that the proposed rule change will facilitate
transactions in municipal securities and municipal financial products
and remove impediments to and perfect the mechanism of a free and open
market in municipal securities and municipal financial products by
eliminating potential regulatory duplication and complexity through the
establishment of a uniform standard for assessing the recommendations
of municipal securities made by Broker-Dealers to retail customers.
ii. Aligning MSRB Rule G-19's Quantitative Suitability Obligation to
the Requirements of Regulation Best Interest
    The Commission finds that proposed rule change's amendments to MSRB
Rule G-19 eliminating the control element from a Dealer's quantitative
suitability obligations for recommendations subject to MSRB Rule G-19
will enhance investor protection for customers that are not retail
customers for purposes of Regulation Best Interest by requiring a
Dealer to always form a reasonable basis as to the recommended
frequency of trading in a retail customer's account--irrespective of
whether the Dealer ``controls'' or exercises ``de facto control'' over
the retail customer's account.\80\
---------------------------------------------------------------------------

    \80\ See, e.g., Regulation Best Interest Adopting Release, 83 FR
at 33374.
---------------------------------------------------------------------------

    The Commission also believes that the proposed rule change will
foster cooperation and coordination with regulators by joining the
Commission (in Regulation Best Interest) and FINRA (in FINRA-2020-07)
\81\ in collectively eliminating the control element from assessing the
recommendations made by Dealers. In this respect, the proposed rule
change will allow Dealers to more efficiently operationalize compliance
with their obligations under both Regulation Best Interest and MSRB
Rule G-19, and to more efficiently

recommend and ultimately execute transactions in the municipal
securities market without any attendant reduction in investor
protection and thereby facilitate transactions in municipal securities
and municipal financial products and remove impediments to and perfect
the mechanism of a free and open market in municipal securities and
municipal financial products.
---------------------------------------------------------------------------

    \81\ See Exchange Act Release No. 89091 (June 18, 2020), 85 FR
37970 (June 23, 2020) (SR-FINRA-2020-07).
---------------------------------------------------------------------------

iii. Amending MSRB Rule G-48(c) To State That the Exception From the
Customer-Specific Suitability Requirement Is Available Only When a
Recommendation Is SubjectTo MSRB Rule G-19
    The Commission believes that the proposed rule change's revision of
MSRB Rule G-48(c) (stating that the exception from the customer-
specific suitability requirement is available only when a
recommendation is subject to MSRB Rule G-19) will foster cooperation
and coordination with regulators by harmonizing MSRB rules with
Regulation Best Interest and enhance investor protection by ensuring
that the Best Interest Standard applies to all recommendations by
Broker-Dealers made to retail customers irrespective of their net
worth. By clarifying that there is no SMMP-based exception to a Broker-
Dealer's obligations when making a recommendation to a retail customer,
all retail customers of Broker-Dealers will benefit from the enhanced
quality of Broker-Dealer recommendations and reduced harm caused by
conflicts of interest, consistent with Regulation Best Interest.
    The Commission also believes that eliminating any ambiguity
regarding the interplay of MSRB Rule G-48 and MSRB Rule G-19 will
enable Broker-Dealers to more efficiently fulfill their regulatory
obligations and thereby remove impediments to and perfect the mechanism
of a free and open market in municipal securities and municipal
financial products market due to the greater regulatory certainty under
the proposed rule change.

B. Amendments Related to Non-Cash Compensation

    The Commission believes that the approach proposed by the MSRB with
respect to its non-cash compensation rules is appropriate and designed
to protect investors and the public interest, consistent with of the
Exchange Act. In particular, the Commission believes that the proposed
rule change will help protect investors and the public interest by
clarifying that the incentives Dealers may offer pursuant to non-cash
compensation arrangements under the relevant MSRB rules as amended are
consistent with the applicable requirements under Regulation Best
Interest. For these reasons, the Commission finds that the proposed
rule change to MSRB Rule G-20 is consistent with the Exchange Act.
    Furthermore, by clarifying that any non-cash compensation permitted
by MSRB Rule G-20(g) must also be consistent with the applicable
requirements of Regulation Best Interest to be permissible and thereby
eliminating any potential regulatory duplication or ambiguity, the
Commission believes that the proposed rule change will foster
cooperation and coordination with regulators as well as remove
impediments to and perfect the mechanism of a free and open market in
municipal securities and municipal financial products by harmonizing
MSRB rules with Regulation Best Interest.\82\
---------------------------------------------------------------------------

    \82\ 15 U.S.C. 78o-4(b)(2)(C).
---------------------------------------------------------------------------

C. Amendments Related to Books and Records

    The Commission believes that the proposed rule change's amendments
to MSRB Rules G-8 and G-9 are consistent with Exchange Act Section
15B(b)(2)(C) because the proposed rule change will foster cooperation
and coordination with regulators, facilitate transactions in municipal
securities and municipal financial products, remove impediments to and
perfect the mechanism of a free and open market in municipal securities
and municipal financial products, and protect investors.\83\
---------------------------------------------------------------------------

    \83\ Id.
---------------------------------------------------------------------------

i. Amending MSRB Rule G-8 To Align With Exchange Act Rule 17a-3
    The Commission believes that the proposed rule change to MSRB Rule
G-8 will foster cooperation and coordination with regulators and will
protect investors by harmonizing MSRB rules with the Commission's
record-keeping requirements under Exchange Rule Act Rule 17a-3, as
amended by Regulation Best Interest and Form CRS. Specifically, the
Commission believes that the proposed rule change will enable
regulators to assess Broker-Dealers' compliance with their obligations
under Regulation Best Interest and Form CRS by ensuring that such
Broker-Dealers are required to make records related to Regulation Best
Interest and Form CRS regardless of whether they look to MSRB Rule G-8
or Exchange Act Rule 17a-3 for their record-making obligations. The
Commission also believes that this approach to ensuring Broker-Dealer
compliance with the requirements of Regulation Best Interest and Form
CRS will also protect investors by ensuring that Broker-Dealers,
whether they follow MSRB G-8 or Exchange Act Rule 17a-3, will be
obligated to create certain records to evidence their compliance with
their obligations.
ii. Amending MSRB Rule G-9 To Align With Exchange Act Rule 17a-4
    The Commission finds that the proposed rule change's revisions to
MSRB Rule G-9 to correspond with SEC books and records requirements
will protect investors, thereby ensuring that Broker-Dealers are
subject to similar requirements, whether under MSRB rules or the rules
of the SEC under record-keeping requirements under Exchange Rule Act
Rule 17a-4, as amended by Regulation Best Interest and Form CRS.
Specifically, the Commission believes that the proposed rule change
will enable regulators to assess Broker-Dealers' compliance with their
obligations under Regulation Best Interest and Form CRS by ensuring
that such Broker-Dealers are required to preserve records related to
Regulation Best Interest and Form CRS regardless of whether they look
to MSRB Rule G-9 or Exchange Act Rule 17a-4 for their record-making
obligations. The Commission also believes that this approach to
ensuring Broker-Dealer compliance with the requirements of Regulation
Best Interest and Form CRS will also protect investors by ensuring that
Broker-Dealers, whether they follow MSRB G-9 or Exchange Act Rule 17a-
4, will be obligated to preserve certain records to evidence their
compliance with their obligations for the same duration.
    In approving the proposed rule change, the Commission has
considered the proposed rule change's impact on efficiency,
competition, and capital formation.\84\ Exchange Act Section
15B(b)(2)(C) \85\ requires that MSRB rules not be designed to impose
any burden on competition not necessary or appropriate in furtherance
of the purposes of the Exchange Act. The Commission does not believe
that the proposed rule change would impose any burden on competition
not necessary or appropriate in furtherance of the purposes of the
Exchange Act because the proposed rule change would align MSRB rules
with (or otherwise clarify the applicability of MSRB rules in relation
to) the requirements of Regulation Best Interest.
---------------------------------------------------------------------------

    \84\ 15 U.S.C. 78c(f).
    \85\ 15 U.S.C. 78o-4(b)(2)(C).
---------------------------------------------------------------------------

    Moreover, the Commission observes that because Bank Dealers are not

subject to Regulation Best Interest or Form CRS, any different
compliance standards between Bank Dealers and non-Bank Dealers under
MSRB Rules result from Regulation Best Interest and Form CRS directly
rather than the MSRB's promulgation of rules for consistency therewith.
Consequently, this proposed rule change will not impose any burden on
competition not necessary or appropriate in furtherance of the purposes
of the Exchange Act, because it does not change the already existing
competitive landscape between Broker-Dealers subject to Regulation Best
Interest and Form CRS and Bank Dealers not subject thereto. In
addition, to the extent the proposed rule change imposes regulatory
obligations in excess of those prescribed by Regulation Best Interest
or Form CRS, those new obligations apply equally to all Dealers, and
therefore does not impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Exchange Act.
    The Commission has also reviewed the record for the proposed rule
change and notes that the record does not contain any information to
indicate that the proposed rule change would have a negative effect on
capital formation. Furthermore, the Commission believes the proposed
rule change would not impose barriers to capital formation, as the
intention is to increase regulatory certainty by harmonizing MSRB rules
with Regulation Best Interest. The Commission also finds that the
proposed rule change includes provisions that help promote efficiency.
In particular, the Commission believes the proposed rule change may
improve Dealers' regulatory certainty by promoting clarity and
consistency on issues related to suitability and permissible non-cash
compensation, as well recordkeeping and record-making.
    The Commission received comment letters on the proposed rule
change, which were supportive of the proposed rule change and suggested
no amendments to the propose rule change.\86\
---------------------------------------------------------------------------

    \86\ See Letter to Secretary, Commission, from Kelli McMorrow,
Head of Government Affairs & Director of Fixed Income Policy,
American Securities Association, dated May 21, 2020 (the ``ASA
Letter''); Letter to Secretary, Commission, from Kristen
Malinconico, Director, U.S. Chamber of Commerce's Center for Capital
Market Competitiveness, dated June 2, 2020 (the ``CCMC Letter'').
---------------------------------------------------------------------------

    For the reasons noted above, the Commission believes that the
proposed rule change is consistent with the Exchange Act.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Exchange Act,\87\ that the proposed rule change (SR-MSRB-2020-02) be,
and hereby is, approved.
---------------------------------------------------------------------------

    \87\ 15 U.S.C. 78s(b)(2).

    For the Commission, pursuant to delegated authority.\88\
---------------------------------------------------------------------------

    \88\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-14115 Filed 6-30-20; 8:45 am]
BILLING CODE 8011-01-P