The Securities and Exchange Commission's Investor Advisory Committee recommended
that the agency work to give bond buyers more information about transactions costs before they purchase the instruments.
Dealers should be telling retail investors more about fees, commissions, markups and markdowns as part of a greater push toward price transparency in fixed-income markets, the committee said.
The advisory committee's recommendation isn't binding on the SEC, but Chair Mary Jo White said she largely agrees with it.
The recommendations build on work by the Municipal Securities Rulemaking Board (MSRB) and Financial Industry Regulatory Authority (FINRA). Both groups have issued rules and guidance dealing with best-execution requirements in municipal bond transactions.