SEC Committee Makes Recommendations Regarding Timeliness of Financial Disclosures in the Municipal Securities Market

February 18, 2020

Client Alert
On February 10, 2020, the SEC’s Fixed Income Market Structure Advisory Committee (the “FIMSAC”) approved a series of recommendations designed to improve the timeliness of disclosure in the municipal securities market (the “Recommendations”). The Recommendations were drafted by the Municipal Securities Transparency Subcommittee (the “Subcommittee”) of the FIMSAC. The approval of the Recommendations was preceded by a discussion of the current state of municipal disclosure among the FIMSAC members and panelists, including members of the issuer and investor communities and Former SEC Chair Elisse Walter.


The SEC established the FIMSAC in 2018 to provide advice to the SEC on the efficiency and resiliency of the U.S. fixed income markets and to identify opportunities for regulatory improvement. The FIMSAC is composed of a group of outside experts, including individuals representing the views of retail and institutional investors, small and large issuers, trading venues, dealers and self-regulatory organizations. The FIMSAC’s recommendations to the SEC are not binding. The Subcommittee was formed to consider the impacts of transparency, both pre-trade and post-trade, in the municipal securities market. In preparing the Recommendations, the Subcommittee studied the availability of financial information about issuers and obligated persons (collectively referred to herein as “issuers”) and found that while the breadth of information made available to investors is reasonably comprehensive, the timeliness of the submission of such information varies among issuers.

The Recommendations

The Recommendations outline the regulatory framework for disclosure in the municipal securities market and describe, among other things, the broad exemptions offered to issuers from the registration and reporting requirements of the federal securities laws that apply to corporate issuers. Also outlined are the current limitations of the SEC’s authority to enforce the contractual promise that an issuer provides in a continuing disclosure agreement. The Recommendations approved by the FIMSAC and designed to benefit municipal securities holders are as follows: 

 1. Legislative

2. Regulatory

3. Education

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