Notice Requesting Comment on Draft Amendments to Rule G-34 to Facilitate Real-Time Transaction Reporting and Explaining Time of Trade for Reporting New Issue Trades

In January 2005, the municipal securities market is scheduled to convert from overnight “batch” systems for trade reporting to “real-time” systems.  Under a proposal filed with the Securities and Exchange Commission, Rule G-14 would be changed at that time to require submission of trade reports within 15 minutes after trade execution rather than by midnight on trade date.[1]  While the MSRB has proposed exceptions to the 15-minute requirement that would apply to many of the trades executed on the first day of trading in a new issue, some of the excepted trades will be subject to a three-hour reporting requirement.  Other trades on the first day of trading may not qualify for an exception and thus will have to be reported within 15 minutes.  The MSRB is proposing for comment draft amendments to Rule G-34 designed to help dealers meet these accelerated trade reporting obligations on the first day of trading in an issue. 

Rule G-34, on CUSIP numbers and new issue requirements, requires underwriters to take certain steps to ensure that the issues they underwrite can be processed in the market’s systems for clearance, settlement and transaction reporting.  One of the underwriter’s duties is to ensure that CUSIP numbers are assigned in time for the initial trades in an issue to be processed correctly on trade date.  Another important duty is to communicate the “initial trade date,” along with the CUSIP numbers for the issue, to syndicate and selling group members on the initial trade date.  This alerts syndicate and selling group members, who are likely to have pending orders in the issue, of the day that they should execute their first transactions in the issue and also notifies them of final CUSIP number assignments.

Since the timing for trade reports in a real-time environment generally will be measured from the time of trade execution rather than the day that the trade occurs, the draft amendments would replace the concept of “initial trade date” with “time of formal award.”  This term, reflecting the earliest time that a trade in a new issue can be executed, would be defined as: (i) for negotiated issues, the time that the bond purchase agreement (BPA) is executed; and (ii) for competitive issues, the issuer’s official announcement of the award.  The draft amendments also seek to accelerate the time that underwriters notify other dealers of CUSIP numbers and the “time of formal award.”  The underwriter would disseminate this information “as soon as possible,” with the dissemination of all necessary information to be made no later than the time of the underwriter’s first trade executions in the new issue.  The draft amendments also propose that the underwriter make this information accessible to dealers other than just those in the underwriting group in order to allow those dealers to report transactions correctly.  Finally, modifications are proposed in the deadlines for obtaining CUSIP numbers to ensure that CUSIP numbers will always be available before the first transactions in the issue are executed.[2]

Like the current provisions in Rule G-34, the draft amendments comport with a 1982 MSRB interpretive notice holding that transactions cannot be executed or confirmed in a new issue prior to the time of formal award.  This policy is discussed below, along with a more detailed explanation of the draft amendments. 

Comments on the draft amendments are requested and should be made no later than August 18, 2004.  Responses to or questions about this notice may be directed to Justin R. Pica, Uniform Practice Specialist.  Written comments will be available for public inspection. 

EXISTING PROVISIONS OF RULE G-34 SUPPORTING OVERNIGHT TRADE REPORTING

Rule G-14 currently sets a midnight deadline on trade date for dealers to submit trade reports for transaction reporting purposes.[3]  The requirement applies to new issue trades as well as to secondary market trades.  Rule G-34 requires the underwriter[4] of a new issue to take several actions so that syndicate and selling group members can report their trades properly at the end of the first day of trading in a new issue.  Under the existing requirements of the rule, the underwriter must: (i) ensure that CUSIP numbers are assigned to the issue by the day that the issue is formally awarded; and (ii) communicate the CUSIP numbers and the initial trade date for the issue to syndicate and selling group members on the initial trade date.  This latter provision allows syndicate and selling group members to process and report their own transactions in the issue in a coordinated and correct manner on the initial trade date.

The term “initial trade date” is defined in Rule G-34 as follows:  For negotiated issues, it is the date that the BPA is executed or the date that allocations are first made by the underwriter, whichever is later.  For competitive sales, it is the date the official award is made by the issuer or the date that allocations are first made by the underwriter, whichever is later.  This definition gives flexibility to the underwriter in determining the initial trade date on which trading in an issue officially starts.  For example, if the underwriter chooses not to execute its first transactions[5] on the formal award date (as might be the case if the BPA is signed at night), it may instead execute its first transactions on the next business day.

DRAFT AMENDMENTS TO RULE G-34 PROPOSED TO SUPPORT REAL TIME-TRADE REPORTING

In January 2005, the transaction reporting process for municipal securities will convert to a “real-time” process, with most trades being subject to a 15-minute reporting requirement.  The MSRB has proposed in Rule G-14 two exceptions to the fifteen-minute reporting requirement that will apply to some transactions done on the first day of trading.  Under those exceptions: (i) dealers that are members of a syndicate or selling group[6] that effect trades in a new issue at the list offering price may report trades by the end of the first day of trading; and (ii) dealers that are not syndicate or selling group members and that have not traded an issue in the previous year may report trades within three hours of the time of trade execution.[7]  While many trades executed during the first day of trading will qualify for one of these exemptions, other trades (e.g., “non-list price” trades by syndicate or selling group members) will have to be reported within 15 minutes of trade execution.  It also should be noted that the three-hour reporting exception, which will generally be available to dealers outside the underwriting group on the first day of trading, will require accelerated reporting of trades compared with the current end-of-day reporting requirement.  The draft amendments would modify existing provisions of Rule G-34 to ensure that dealers can report trades in a timely manner in this real-time processing environment. 

“Time of Formal Award”

Since the timing for trade reports in a real-time environment generally will be measured from the time of trade execution rather than the day that the trade occurs, the draft amendments would replace the concept of “initial trade date” with “time of formal award.”  This term, reflecting the earliest time that a trade in a new issue can be executed, would be defined as: (i) for negotiated issues, the time that the BPA is executed; and (ii) for competitive issues, the time of the issuer’s official announcement of the award.  Although this is the earliest time that a trade in a new issue can be executed, the underwriter is not required by MSRB rules to execute trades at that time.  In cases in which a formal award occurs after the end of the business day, or at night, for example, the underwriter might choose to execute its first transactions on the next business day, just as is permitted under the current language of Rule G-34. 

Communication of CUSIP Numbers and Time of Formal Award

Dealers other than the underwriter often will have pending orders in a new issue and may need to report trades within a 15-minute or three-hour time-frame on the first day of trading in an issue.  Therefore, it will be important for those dealers to have information alerting them to the time at which trade executions in the issue can occur -- and the final CUSIP numbers for the issue -- as soon as possible after this information is available.  Toward this purpose, the draft amendments state a duty of the underwriter to communicate CUSIP numbers and the time of formal award “as soon as possible,” and also state a firm deadline by requiring this to be done, in any event, no later than the time that the underwriter executes its first transaction in the issue.[8] 

The requirement to provide information “as soon as possible” includes the concept that CUSIP numbers may be available well in advance of the time of formal award and should be disseminated as soon as practical after they are known.  It is expected that this often would be the case in negotiated sales.  The “time of formal award” also should be communicated as soon as it is known, although it is not intended that this would require an underwriter to make such a communication after normal business hours, as might be the case if a BPA is signed at night.  As discussed above, underwriters in this case would retain the flexibility (with respect to Rule G-34 requirements) to hold the issue overnight and to execute the first transactions in the issue on the next day, at which time the required information could be disseminated.  However, underwriters should be aware that, when other dealers have pending orders in a new issue, those dealers will be waiting for the underwriter’s announcement prior to executing their own transactions.  Therefore, it is important that information on the time of formal award and CUSIP numbers not be delayed unreasonably.

In the case of competitive issues, it is expected that the underwriter winning an auction would communicate the CUSIP numbers and time of formal award, together, shortly after the issuer announces the winner of the auction.  However, if there is a lengthy delay between the opening of bids and the formal announcement (marking the time that trades can be executed), the presumed underwriter may wish to disseminate CUSIP numbers as soon as they are available in order to facilitate trade processing once the formal award is announced.  Comment is requested on this point.  In addition, as discussed in more detail below, it may be necessary in some cases for the winner of a competitive sale to delay making the required communication of CUSIP numbers (and to delay trade executions) if CUSIP numbers are not pre-assigned to the issue prior to the auction.

Broader Dissemination of Information by Underwriters

It is expected that syndicate and selling group members often will have pending orders in a new issue prior to its formal award and will await the underwriter’s communication of the time of formal award before executing trades and reporting them to the transaction reporting system.  However, dealers outside the underwriting group also may have pending orders in an issue and need to know the time of formal award.  Under the existing provisions of Rule G-34, dealers that are not in the underwriting group do not receive a communication from the underwriter notifying them of the “initial trade date” of the issue.  Possibly for this reason, trade executions are sometimes reported by these dealers prior to the date on which the issue is formally awarded, particularly in issues that are priced a day or more in advance of the formal award.  These trade reports made prior to the formal award of an issue are inconsistent with existing MSRB interpretations stating that trades cannot be executed prior to that time.[9]  The inability of dealers outside the underwriting group to know the timing of the formal award also may be the source of some problems in the comparison of inter-dealer trades in new issues. 

To address the situation, the draft amendments propose that, instead of communicating necessary information only to syndicate and selling group members, as required by Rule G-34 today, the underwriter would disseminate the information in “a manner reasonably designed to reach market participants that may trade the issue.”  The proposed requirement is designed to ensure that all dealers that may have pending orders in an issue on the first day of trading have access to the required information so that trades can be reported at the proper time.  For large issues that are widely sold in the market, this effectively would require dissemination of the information on an electronic platform that provides real-time bond information and that is generally accessible to dealers.  Unlike the current provision in Rule G-34, the requirement to disseminate information would apply to sole underwriters as well as to syndicate managers.  However, the draft amendments also contemplate that the method of dissemination would be appropriate to the type of offering.  For example, in the case of a limited placement or a small offering where the underwriter knows all of the parties that will have trades on the first day of trading, notification to those parties would be sufficient to satisfy the rule and further dissemination of the information would not be necessary.  

The draft amendments do not specify or suggest particular electronic platforms by which a required dissemination should be made.  However, as noted in the “Request for Comment” section below, the Board is requesting comment on whether suitable platforms exist for this purpose and what possible alternatives might be.

Timing for CUSIP Number Assignment

A final provision of the draft amendments proposes a modification in the underwriter’s deadline for CUSIP number assignment.  For negotiated issues, the draft amendments change the existing requirement that assignments be made by the “business day on which the BPA is signed” to a requirement that numbers be assigned “by the time of formal award.”  For competitive issues, the draft amendments would change the deadline from “date of award” to “the first execution of a transaction by the underwriter.”  The draft amendments do not affect existing provisions in Rule G-34 that require a dealer acting as financial advisor in connection with a competitive sale to ensure that CUSIP numbers are pre-assigned to the issue.  However, for various reasons CUSIP numbers are not always pre-assigned to competitively bid issues.  A number of dealers have pointed out that, in a real-time environment, it will not be possible for the winning underwriter to have the CUSIP numbers assigned by the time of formal award under these circumstances.  During normal business hours, the underwriter in these situations generally can obtain CUSIP numbers within an hour or two, at which time notifications would be made and trade executions in the issue could begin. 

SUMMARY OF DRAFT AMENDMENTS AND COMPARISON WITH EXISTING PROVISIONS OF RULE G-34

The changes proposed in the draft amendments are summarized and compared to the current requirements in Rule G-34 in the following tables:

 

Underwriter Must Ensure CUSIP Numbers Are Assigned By:

 

Current Provision of Rule G-34	Negotiated Issues: “Business day” that BPA is signed Competitive Issues: Date of Award
Proposed Provision for real-time environment	Negotiated Issues: Time of Formal Award Competitive Issues: First execution of a transaction in the new issue by the underwriter

 

Underwriter Must Communicate Information So that Other Dealers Can Report Transactions on First Day of Trading:

 

Current Provision of Rule G-34	What is communicated: CUSIP numbers, identifying information for issue, and initial trade date Who it is communicated to: Syndicate and selling group members When communication must be made: On initial trade date
Proposed Provision for real-time environment	What is communicated: CUSIP numbers, identifying information for the issue and time of formal award Who it is communicated to: Announced “in a manner reasonably designed to reach market participants that may trade the issue” When communication must made: As soon as possible, but no later than time of underwriter’s first execution of a transaction in the new issue

 

REQUEST FOR COMMENT

 

The MSRB requests comment on the draft amendments.  Comment is specifically requested on how the announcement of award is made by issuers in the case of competitive sales and whether this generally occurs within a short period of time after bids are opened.  Comment also is specifically requested on the requirement for underwriters to communicate information to dealers outside the underwriting group and how this may be done.  Dealers may wish to comment on whether there currently exist electronic venues in the marketplace (e.g., internet sites, information vendors, syndicate services, etc.) by which underwriters could make announcements that provide reasonable access to all dealers.  If no such venue currently exists, or if there would be problems in making effective announcements through all existing venues, should the MSRB provide such a special-purpose solution, using newsgroup posting and/or e-mail notification technology?

"TIME OF TRADE" AND REAL-TIME TRADE REPORTING OF NEW ISSUE TRADES

The planned implementation of real-time transaction reporting has generated questions about transaction reporting of new issue trades, particularly trades done on the first day of trading.  For example, questions have been raised about how transaction reporting obligations can be handled if CUSIP numbers have not yet been assigned or are not available to a dealer with a pending order.  The draft amendments should help to answer some of these questions.  Other questions more directly concern the time at which trades are considered to be executed and thus when they must be reported.  These questions often involve negotiated issues where final pricing occurs a day or more before the BPA is executed.  During this time, dealers often accept priced orders, conditionally allocate to those orders, and may make other conditional trading commitments.  The existing MSRB rules and interpretations in this area are summarized below along with an explanation of how time of trade execution is determined for transaction reporting purposes.

Time of Trade Execution in New Issue Trading

Existing transaction reporting procedures require that “time of trade” (along with trade date) be included in the trade report that is submitted overnight.[10]  In the real-time system, time of trade will be even more important since it will be used to measure compliance with the 15-minute reporting requirement.  Transaction reporting procedures define the “time of trade” as the time when a contract is formed for a sale or purchase of municipal securities at a set price[11] and set quantity.[12]  For purposes of transaction reporting, this is considered to be the same as the time that a trade is “executed.” 

Regardless of whether a trade occurs in the new issue or secondary market, the deadline for reporting the trade is measured from the time of its execution.  In new issue offerings, however, the time at which execution can occur is dependent on the status of the formal award of the issue.  Once a new issue of securities has been formally awarded by the issuer, transactions may be executed on a “when, as and if-issued” (WAII) basis even though the securities technically have not been issued.[13]  However, in a 1982 Interpretative Letter, the MSRB noted that a dealer can not execute or confirm transactions in an issue prior to the formal award by the issuer.[14]  “Formal award” in this context means: (i) the signing of a BPA for negotiated issues; or (ii) the official award of the issue for competitive sales.  After formal award, a pending order in an issue may be executed by the dealer and the deadline for trade reporting is triggered. 

Although trade executions and trade confirmations are not permitted prior to the time of formal award, the MSRB has specifically recognized that dealers often solicit orders, accept orders and (after final pricing decisions are made) conditionally allocate to orders, even though the formal award has not yet occurred.  In its 1982 Interpretive Letter, the MSRB noted that it did not intend to call into question the validity of “pre-sale” orders received for a syndicate’s securities or the practice of soliciting such orders.  It noted that such orders “are expressions of the purchasers’ firm intent to buy the new issue securities in accordance with the stated terms, and that such orders may be filled and confirmed immediately upon the award of the [competitive] issue or the execution of the bond purchase agreement.”[15]  Rule G-11(g) on syndicate practices, specifically recognizes conditional allocations.  It requires syndicate managers to complete allocations “within 24 hours of the sending of the commitment wire” but provides that, if allocations are made prior to the formal award, “such allocations shall be made subject to the signing of the purchase contract or awarding of the securities, as appropriate, and the purchaser shall be informed of this fact.”

The transaction reporting requirement of Rule G-14 is not triggered by a conditional allocation.  Such conditional allocations do not create WAII securities transactions because no securities have been formally authorized for sale in a specific form by the issuer.  Once issue details are finalized at the time of formal award, the underwriter can execute the trade in accordance with the commitments made through the order it received and the conditional allocation it made.  At this time, the transaction reporting deadline would be set based on the time of execution.  Whether a conditional allocation is considered to be executed immediately at the time of the formal award, or at a later time chosen by the underwriter, would depend upon the understanding of the parties when the order was accepted and the conditional allocation was made.  For example, when formal awards are made after normal business hours or late in the day, it is typical for underwriters to delay trade executions until the next business day.  Under MSRB Rule G-8, dealers generally must maintain in their books and records the time of receipt of orders as well as the time that the orders are executed.

The MSRB is aware that dealers or investors receiving conditional allocations from syndicates may sometimes accept orders for the securities that they have been (conditionally) allocated prior to the formal award of the issue.  The prohibition on executing and confirming trades prior to the formal award of an issue applies to all dealers – not just those in the underwriting or selling group.  Therefore, just as in the case of a syndicate making a conditional allocation, a dealer that accepts an order for securities that have been conditionally allocated cannot execute that order prior to the formal award.  It is important for all dealers who may have orders in a new issue – not just those dealers in the syndicate or underwriting group – to be aware of the prohibition on executing trades prior to the time of formal award.[16]  The draft amendments to Rule G-34 are designed to facilitate the flow of information so that these dealers will know the earliest time that trades can be executed in a new issue and will have the information to ensure that trade reports can be made in a timely manner after execution occurs.

Existing transaction reporting procedures are keyed to the time that a trade is executed rather than the time that an order is received or accepted conditionally for execution.  It has been noted that this can create apparent anomalies in reported trade data in some new issue offerings where there are conditional trading commitments made prior to the time of formal award.  The prices for those transactions may reflect market conditions that existed prior to the time of the formal award, even though the time of trade execution will necessarily be after the formal award.  If market conditions have changed in the intervening period, the first prices reported for the issue may not be reliable indicators of current market conditions.  The Board is reviewing this issue to determine whether transaction reporting procedures could be changed to address the anomaly, for example, by requiring an additional indicator on the transaction report of new issue trades that are executed on the basis of a conditional trading commitment.

June 18, 2004

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Text of Draft Amendment*

Rule G-34: CUSIP Numbers and New Issue Requirements

(a) New Issue Securities.

(i) Assignment of CUSIP Numbers.

(A) Except as otherwise provided in this section (a), each broker, dealer or municipal securities dealer who acquires, whether as principal or agent, a new issue of municipal securities from the issuer of such securities for the purpose of distributing such new issue (“underwriter”) shall apply in writing to the Board or its designee for assignment of a CUSIP number or numbers to such new issue. The broker, dealer or municipal securities dealer underwriter shall make such application as promptly as possible, but in no event later than, in the case of negotiated sales, a time sufficient to ensure assignment of a CUSIP number or numbers on or prior to the business day on which time the contract to purchase the securities from the issuer is executed; or, in the case of competitive sales, the date of award time of the first execution of a transaction in the new issue by the underwriter. A broker, dealer or municipal securities dealer acting as a financial advisor to an issuer in connection with a competitive sale of an issue shall ensure that application for a CUSIP number or numbers is made in sufficient time to permit assignment of CUSIP numbers prior to the date time of award. The broker, dealer or municipal securities dealer shall provide to the Board or its designee In making an application for CUSIP number assignment, the following information shall be provided:

(1) complete name of issue and series designation, if any;

(2) interest rate(s) and maturity date(s) (provided, however, that, if the interest rate is not established at the time of application, it may be provided at such time as it becomes available);

(3) dated date;

(4) type of issue (e.g., general obligation, limited tax or revenue);

(5) type of revenue, if the issue is a revenue issue;

(6) details of all redemption provisions;

(7) the name of any company or other person in addition to the issuer obligated, directly or indirectly, with respect to the debt service on all or part of the issue (and, if part of the issue, an indication of which part); and

(8) any distinction(s) in the security or source of payment of the debt service on the issue, and an indication of the part(s) of the issue to which such distinction(s) relate.

(B) The information required by subparagraph (i)(A) of this section (a) shall be provided in accordance with the provisions of this subparagraph. At the time application is made the broker, dealer or municipal securities dealer making such application shall provide to the Board or its designee a The application shall include a copy of a notice of sale, official statement, legal opinion, or other similar documentation prepared by or on behalf of the issuer, or portions of such documentation, reflecting the information required by subparagraph (i)(A) of this section (a). Such documentation may be submitted in preliminary form if no final documentation is available at the time of application. In such event the final documentation, or the relevant portions of such documentation, reflecting any changes in the information required by subparagraph (i)(A) of this section (a) shall be submitted when such documentation becomes available. If no such documentation, whether in preliminary or final form, is available at the time application for CUSIP number assignment is made, such copy shall be provided promptly after the documentation becomes available.

(C) The provisions of paragraph (i) of this section (a) shall not apply with respect to any new issue of municipal securities on which the issuer or a person acting on behalf of the issuer has submitted an application for assignment of a CUSIP number or numbers. to such issue to the Board or its designee.

(D) In the event that the proceeds of the new issue will be used, in whole or in part, to refund an outstanding issue or issues of municipal securities in such a way that part but not all of the outstanding issue or issues previously assigned a single CUSIP number is to be refunded to one or more redemption date(s) and price(s) (or all of an outstanding issue is to be refunded to more than one redemption date and price), the broker, dealer or municipal securities dealer shall apply in writing to the Board or its designee for a reassignment of a CUSIP number to each part of the outstanding issue refunded to a particular redemption date and price and shall provide to the Board or its designee the following information on the issue or issues to be refunded:

(1) the previously assigned CUSIP number of each such part or issue;

(2) for each such CUSIP number, the redemption dates and prices, to be established by the refunding;

(3) for each such redemption date and price, a designation of the portion of such part or issue (e.g., the designation of use of proceeds, series, or certificate numbers) to which such redemption date and price applies.

The broker, dealer or municipal securities dealer underwriter also shall provide documentation supporting the information provided pursuant to the requirements of this subparagraph (D).

(ii) Application for Depository Eligibility, CUSIP Number Affixture and Initial Communications. Each broker, dealer or municipal securities dealer who acquires, whether as principal or agent, a new issue of municipal securities from the issuer of such securities for the purpose of distributing such new issue ("underwriter") shall carry out the following functions:

(A) Except as otherwise provided in this subparagraph (ii)(A), the underwriter shall apply to a securities depository registered with the Securities and Exchange Commission, in accordance with the rules and procedures of such depository, to make such new issue depository-eligible. The application required by this subparagraph (ii)(A) shall be made as promptly as possible, but in no event later than one business day after award from the issuer (in the case of a competitive sale) or one business day after the execution of the contract to purchase the securities from the issuer (in the case of a negotiated sale). In the event that the full documentation and information required to establish depository eligibility is not available at the time the initial application is submitted to the depository, the underwriter shall forward such documentation as soon as it is available; provided, however, this subparagraph (ii)(A) of this rule shall not apply to:

(1) an issue of municipal securities that fails to meet the criteria for depository eligibility at all depositories that accept municipal securities for deposit; or

(2) any new issue maturing in 60 days or less.

(B) The underwriter, prior to the delivery of such securities to any other person, shall affix to, or arrange to have affixed to, the securities certificates of such new issue the CUSIP number assigned to such new issue. If more than one CUSIP number is assigned to the new issue, each such number shall be affixed to the securities certificates of that part of the issue to which such number relates.

(C) The underwriter, on initial trade date, shall communicate as promptly as possible announce the information listed below in a manner reasonably designed to reach market participants that may trade the new issue.  All information shall be announced no later than the time of the first execution of a transaction in the new issue by the underwriter. the following information to syndicate and selling group members:

(1) the CUSIP number or numbers assigned to the issue and descriptive information sufficient to identify the CUSIP number corresponding to each part of the issue assigned a specific CUSIP number; and

(2) the initial trade date time of formal award.  For purposes of this subparagraph (a)(ii)(C), initial trade date time of formal award shall mean, for competitive issues, either the date time of the issuer announces the award, or the first date allocations are made to syndicate or selling group members, whichever date is later, and, for negotiated issues, either the date time on which the contract to purchase the securities from the issuer is executed, or the first date allocations are made to syndicate or selling group members, whichever date is later.

(D) For any new issue of municipal securities eligible for comparison through the automated comparison facilities of a registered clearing agency under section (f) of rule G-12, the underwriter shall provide the registered securities clearing agency responsible for comparing when, as and if issued transactions with:

(1) final interest rate and maturity information about the new issue as soon as it is available; and

(2) the settlement date of the new issue as soon as it is known and shall immediately inform the registered clearing agency of any changes in such settlement date.

(iii) Underwriting Syndicate. In the event a syndicate or similar account has been formed for the purchase of a new issue of municipal securities, the managing underwriter shall take the actions required of the underwriter under the provisions of this section (a).

(b) - (c) No changes.