ICI Comments on MSRB's Electronic Delivery Proposal

Washington, DC, September 18, 2006 - The Institute supports a Municipal Securities Rulemaking Board (MSRB) proposal to implement an electronic system of primary market disclosure in the municipal securities market. MSRB's electronic delivery proposal is patterned after the SEC's "access equals delivery" standard, which permits broker-dealers to make prospectuses electronically available to investors rather than delivering printed copies.

Background
The MSRB has proposed to implement an electronic system of primary market disclosure, designed to promote more effective and efficient delivery of material information to new issue customers and the marketplace in general. The system would be modeled in part on recent rule changes adopted by the SEC that instituted an "access equals delivery" model for prospectus delivery for much of the registered securities market. Because of the unique nature of the municipal securities market, however, the MSRB has modified the SEC's approach.

ICI Position
Investment companies hold approximately 32 percent of all U.S. municipal securities, totaling over $722 billion, on behalf of fund investors, and thus have a vital interest in ensuring timely and efficient access to official statements of municipal securities issuers.

ICI commends the MSRB for its initiative to promote significantly more effective and efficient delivery of material information on municipal securities, and strongly supports the "access equals delivery" standard for official statements in the primary municipal securities market.

The Institute also believes that investors would be best served if official statements were made available at a centralized Internet website rather than through a central directory. The Institute also supports increased reliance on electronic disclosure for mutual funds as well as municipal fund securities.

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