The Financial Data Transparency Act Takes Center Stage at Municipal Securities Disclosure Conference

Momentum around the Financial Data Transparency Act (FDTA) continues to grow. Last month, our team traveled to Washington, D.C. for the RegTech 2023 Data Summit. As the title sponsor, DFIN was well represented and had the pleasure of leading many FDTA-themed discussions.

I got to kick off the event and introduce the keynote speaker and U.S. SEC Commissioner Hester Peirce, who discussed four principles critical to implementing FDTA. You can read more about her speech in my recent blog, “Hester Peirce’s RegTech Speech is Good Sign for Financial Data Transparency Act (FDTA) Success.”

While RegTech 2023 is now in our rearview mirror, the FDTA discussions remain at the top of everyone’s agenda. In fact, on May 10th, it will be the main focal point at the Municipal Securities Disclosure Conference hosted by the SEC.

The SEC oversees the Office of Municipal Securities (OMS) and the Municipal Securities Rulemaking Board (MSRB). With last December’s passing of the FDTA, the Commission has new marching orders—promulgate a new set of standards before the act goes into effect in two years. Some of the upcoming dates for the adoption and implementation of key standards include (the full list is included at the end of this blog):

• By June 2023–The SEC will establish a corporate data quality program and submit an initial report to Congress on the costs and benefits of structured data in corporate disclosures.
• By June 2024–Federal financial regulators will publish proposed rules for comment to establish Joint Data Standards.
• By December 2024–Federal financial regulators will issue the final Joint Rulemaking adoption.

Many of the discussions at the conference will revolve around these standards and their implementation dates. The event will begin with SEC Chair Gary Gensler, who will provide the opening remarks. Gensler will be joined by additional SEC participants, including:

• Hester M. Peirce, SEC Commissioner
• Jaime Lizárraga, SEC Commissioner
• Mary N. Simpkins, Senior Special Counsel, SEC Office of Municipal Securities
• Mark S. Elion, Senior Counsel, SEC Office of Municipal Securities.
• Adam R. Wendell, Deputy Director, SEC Office of Municipal Securities
• Dave A. Sanchez, Director, SEC Office of Municipal Securities

As advocates for the FDTA and its passage for over a decade, we will closely follow the discussions at this conference and share our key event takeaways on the DFIN blog, where we will also preview the industry’s next big event, the annual Government Finance Officer Association (GFOA) Conference.

In the meantime, we encourage those with questions to contact our team.

Complete Timeline for municipal market data standards adoption and implementation:

• By June 2023–The SEC establishes a corporate data quality program and submits an initial report to Congress on the costs and benefits of structured data in corporate disclosures.
• By June 2024–Federal financial regulators publish proposed rules for comment to establish Joint Data Standards.
• By December 2024–Federal financial regulators issue final Joint Rulemaking, adopting Joint Data Standards.
• Mid-to-late 2026–The SEC likely publishes proposed Municipal Market Data Standards for comment; MSRB likely publishes shortly thereafter conforming proposed rule changes and information system enhancements for comment.
• By December 2026–Joint Data Standards become effective; SEC issues final rule adopting Municipal Market Data Standards.
• 2027 and thereafter–Likely effective date(s) for Municipal Market Data Standards and associated MSRB rule changes and information system enhancements. Municipal issuers and other municipal market participants seeking to better understand the implications of the FDTA, what steps they can take as the rulemaking process for the Municipal Market Data Standards unfold, and how to prepare for implementation of the Municipal Market Data Standards.