ACA’s June 2016 Broker-Dealer Newsletter identified that the U.S. Securities and Exchange Commission (“SEC”) approved amendments to Municipal Securities Rulemaking Board (“MSRB”) Rules G-12 and G-15, redefining settlement dates for “regular way” transactions to a two-day settlement cycle (“T+2”). We suggested that firms should review and test their operational processes and trade processing systems to ensure a seamless migration to T+2.
The MSRB Notice 2016-15 had indicated the amendments would become effective alongside the industry’s transition to T+2. At that time, a specific date for the industry’s transition to T+2, which hinged upon the effective dates for the corresponding amendments to Exchange Act Rule 15c6-1, had not yet been determined.
On March 22, 2017, the SEC adopted the T+2 settlement cycle for securities transactions by amending Rule 15c6-1. Broker-dealers will be required to comply with the amended rule beginning on September 5, 2017.
The amended Rule 15c6-1(a) will essentially stay the same and be applicable to the same securities transactions currently covered by the T+3 settlement cycle. The amendment will mean that payment for a purchase or delivery of a security must be received no later than two business days after the trade is executed.
As previously noted, the SEC had approved amendments to MSRB rules in 2016. On March 28, 2017, the MSRB published MSRB Notice 2017-17 indicating that the amendments will be effective September 5, 2017.
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If you have questions regarding any of these issues or requirements, please contact your ACA consultant or Dee Stafford at (561) 628-5288.