MSRB Announces Continuing Disclosure Pilot Program for Electronic Municipal Market Access System

April 21, 2009

As previously discussed in the McGuireWoods news item SEC Amends Municipal Securities Disclosure Rule, the U.S. Securities and Exchange Commission (the “SEC”) issued a final rule on December 5, 2008 amending SEC Rule 15c2-12 (the “Rule”) under the Securities Exchange Act of 1934, as amended, requiring submissions of municipal disclosure to be made to the Municipal Securities Rulemaking Board (the “MSRB”) through its Electronic Municipal Market Access System (“EMMA”) beginning July 1, 2009. The MSRB intends to launch a pilot phase of EMMA (the “EMMA Pilot”) on or after May 11, 2009. The EMMA Pilot will accept continuing disclosure documents, accompanied by related indexing information, from municipal securities issuers, obligated persons and their agents (“Submitters”). Submission of continuing disclosures to the EMMA Pilot will be entirely voluntary until July 1, 2009, when the permanent EMMA begins and continuing disclosure submissions to EMMA become mandatory.

Under both the EMMA Pilot and EMMA, Submitters will be issued password-protected access for the submission of continuing disclosure documents. As currently approved, EMMA will accept annual or periodic financial and operating data filings and material event notices specified under the Rule, along with certain other disclosure documents specified in continuing disclosure undertakings but not specifically described in the Rule. EMMA is also expected to accept certain additional voluntary disclosures of financial and operating data and events not specified by the Rule and not specified in a continuing disclosure undertaking. All continuing disclosure documents submitted to EMMA must be in portable document format (“PDF”). Although PDF file submissions are not required to be word searchable before January 1, 2010, the MSRB strongly encourages Submitters to submit PDF files that are word searchable. Submission of continuing disclosures to EMMA is free of charge. Registration for user accounts, which are required to make submissions to EMMA, will be done through the MSRB Gateway.

The MSRB encourages Submitters who currently submit continuing disclosures to the MSRB in accordance with outstanding continuing disclosure agreements to establish user accounts, familiarize themselves with the EMMA submission process and begin submitting continuing disclosure documents through the EMMA Pilot before continuing disclosure submission to EMMA becomes mandatory on July 1, 2009. The MSRB will deem submissions to the EMMA Pilot prior to July 1, 2009 as having been submitted to the MSRB, but such submissions may not satisfy other provisions of outstanding continuing disclosure agreements. Therefore, Submitters submitting continuing disclosures to the EMMA Pilot also must continue to submit continuing disclosures to the Nationally Recognized Municipal Securities Information Repositories (each, a “NRMSIR”) and state information depositories, or SIDs, as required by their outstanding continuing disclosure agreements and/or applicable state law. Beginning July 1, 2009, the MSRB will be the sole NRMSIR under the Rule, and all submissions that would have been made to one of the existing NRMSIRs prior to July 1, 2009 instead must be made to EMMA. Although the Rule will not require continuing disclosure submissions to SIDs after July 1, 2009, the amended Rule will not affect the obligations of Submitters under applicable state law and/or continuing disclosure agreements entered into prior to July 1, 2009 to make continuing disclosure filings with a SID.

Frequently asked questions and answers about the MSRB’s continuing disclosure submission process are available on the EMMA Dataport. Submission instructions will be available on the EMMA Dataport in the EMMA Dataport Manual for Continuing Disclosure Submissions. Additionally, the MSRB plans to offer “Webinar” training on continuing disclosure submissions on a schedule yet to be determined.

If you have any questions regarding the upcoming changes to municipal securities continuing disclosure requirements and their effects on municipal securities issuers, obligated persons or their agents, please contact a member of our Public Finance group or contact one of the attorneys listed.

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