Form 19b-4 - FINRA - Rules and Regulations

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The “access equals delivery” standard provides, pursuant to Securities Act Rule 172, that
a broker-dealer selling a security in a registered offering need not deliver a final prospectus to
the customer if the registration statement is effective and the final prospectus is filed with the
SEC (or a good faith and reasonable effort to file it is made) within the required timeframe.
Under Securities Act Rule 173, a broker-dealer selling such a security must provide to the
customer a notice that the security was sold in a registered offering within two business days
after completion of the sale. Customers may request printed copies of the final prospectus. The
“access equals delivery” standard also applies to aftermarket trades of newly issued securities
pursuant to Securities Act Rule 174. This standard is not available to certain classes of
registered securities, including but not limited to mutual fund shares. 2
Official Statement Deliveries Under Current MSRB Rules. Under Rule G-32, a
dealer selling a new issue municipal security to a customer during the period ending 25 days
after bond closing (the “new issue disclosure period”) must deliver the official statement to the
customer on or prior to trade settlement. 3 The rule includes inter-dealer delivery requirements
for new issue municipal securities to assist selling dealers to meet their customer delivery
obligations. 4
Rule G-36 requires underwriters to submit official statements to the MSRB. For
offerings subject to Exchange Act Rule 15c2-12, the official statement must be sent within one
business day after receipt from the issuer but no later than ten business days after the bond sale. 5
With limited exceptions, official statements for all other offerings must be sent by the later of
one business day after receipt from the issuer or one business day after bond closing. Submitted
official statements must be accompanied by completed Form G-36(OS). Official statements may
be submitted in either paper or electronic format. These submissions are collected into a
comprehensive library for the municipal securities market. The MSRB makes these documents
available to subscribers, many of whom disseminate them (typically for a fee) or use them to
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See Section VI (Prospectus Delivery Reforms) of the SEC Release for a detailed
description of the SEC rules implementing the “access equals delivery” standard.
Rule G-32 provides limited exceptions to this delivery requirement. The dealer also must
provide certain additional information about the underwriting (including initial offering
prices) if the issue was purchased by the underwriter in a negotiated sale.
Selling dealers and the managing underwriter must send official statements to purchasing
dealers promptly upon request. Dealer financial advisors that prepare the official
statement must provide such official statement to the managing underwriter promptly.
Rule 15c2-12(b)(3) requires an underwriter in an offering subject to the rule to contract
with the issuer to receive the official statement within seven business days after the bond
sale and in sufficient time to accompany money confirmations sent to customers.