Broker-dealer registration requirement and exemptions.
409.4-401. (a) It is unlawful for a person to transact business in thisstate as a broker-dealer unless the person is registered under this act as abroker-dealer or is exempt from registration as a broker-dealer undersubsection (b) or (d).
(b) The following persons are exempt from the registration requirementof subsection (a):
(1) A broker-dealer without a place of business in this state if itsonly transactions effected in this state are with:
(A) The issuer of the securities involved in the transactions;
(B) A broker-dealer registered under this act or not required to beregistered as a broker-dealer under this act;
(C) An institutional investor;
(D) A nonaffiliated federal covered investment adviser with investmentsunder management in excess of one hundred million dollars acting for theaccount of others pursuant to discretionary authority in a signed record;
(E) A bona fide preexisting customer whose principal place of residenceis not in this state and the person is registered as a broker-dealer under theSecurities Exchange Act of 1934 or not required to be registered under theSecurities Exchange Act of 1934 and is registered under the securities act ofthe state in which the customer maintains a principal place of residence;
(F) A bona fide preexisting customer whose principal place of residenceis in this state but was not present in this state when the customerrelationship was established, if:
(i) The broker-dealer is registered under the Securities Exchange Act of1934 or not required to be registered under the Securities Exchange Act of1934 and is registered under the securities laws of the state in which thecustomer relationship was established and where the customer had maintained aprincipal place of residence; and
(ii) Within forty-five days after the customer's first transaction inthis state, the person files an application for registration as abroker-dealer in this state and a further transaction is not effected morethan seventy-five days after the date on which the application is filed, or,if earlier, the date on which the commissioner notifies the person that thecommissioner has denied the application for registration or has stayed thependency of the application for good cause;
(G) Not more than three customers in this state during the previoustwelve months, in addition to those customers specified in subparagraphs (A)to (F) and under subparagraph (H), if the broker-dealer is registered underthe Securities Exchange Act of 1934 or not required to be registered under theSecurities Exchange Act of 1934 and is registered under the securities act ofthe state in which the broker-dealer has its principal place of business; and
(H) Any other person exempted by rule adopted or order issued under thisact; and
(2) A person that deals solely in United States government securitiesand is supervised as a dealer in government securities by the Board ofGovernors of the Federal Reserve System, the Comptroller of the Currency, theFederal Deposit Insurance Corporation, or the Office of Thrift Supervision.
(c) It is unlawful for a broker-dealer, or for an issuer engaged inoffering, offering to purchase, purchasing, or selling securities in thisstate, directly or indirectly, to employ or associate with an individual toengage in an activity related to securities transactions in this state if theregistration of the individual is suspended or revoked or the individual isbarred from employment or association with a broker-dealer, an issuer, aninvestment adviser, or a federal covered investment adviser by an order of thecommissioner under this act, the Securities and Exchange Commission, or aself-regulatory organization. A broker-dealer or issuer does not violate thissubsection if the broker-dealer or issuer did not know and in the exercise ofreasonable care could not have known, of the suspension, revocation, or bar.Upon request from a broker-dealer or issuer and for good cause, an order underthis act may modify or waive, in whole or in part, the application of theprohibitions of this subsection to the broker-dealer.
(d) A rule adopted or order issued under this act may permit:
(1) A broker-dealer that is registered in Canada or other foreignjurisdiction and that does not have a place of business in this state toeffect transactions in securities with or for, or attempt to effect thepurchase or sale of any securities by:
(A) An individual from Canada or other foreign jurisdiction who istemporarily present in this state and with whom the broker-dealer had a bonafide customer relationship before the individual entered the United States;
(B) An individual from Canada or other foreign jurisdiction who ispresent in this state and whose transactions are in a self-directed taxadvantaged retirement plan of which the individual is the holder orcontributor in that foreign jurisdiction; or
(C) An individual who is present in this state, with whom thebroker-dealer customer relationship arose while the individual was temporarilyor permanently resident in Canada or the other foreign jurisdiction; and
(2) An agent who represents a broker-dealer that is exempt under thissubsection to effect transactions in securities or attempt to effect thepurchase or sale of securities in this state as permitted for a broker-dealerdescribed in paragraph (1).
Broker-dealer registration requirement and exemptions.
409.4-401. (a) It is unlawful for a person to transact business in thisstate as a broker-dealer unless the person is registered under this act as abroker-dealer or is exempt from registration as a broker-dealer undersubsection (b) or (d).
(b) The following persons are exempt from the registration requirementof subsection (a):
(1) A broker-dealer without a place of business in this state if itsonly transactions effected in this state are with:
(A) The issuer of the securities involved in the transactions;
(B) A broker-dealer registered under this act or not required to beregistered as a broker-dealer under this act;
(C) An institutional investor;
(D) A nonaffiliated federal covered investment adviser with investmentsunder management in excess of one hundred million dollars acting for theaccount of others pursuant to discretionary authority in a signed record;
(E) A bona fide preexisting customer whose principal place of residenceis not in this state and the person is registered as a broker-dealer under theSecurities Exchange Act of 1934 or not required to be registered under theSecurities Exchange Act of 1934 and is registered under the securities act ofthe state in which the customer maintains a principal place of residence;
(F) A bona fide preexisting customer whose principal place of residenceis in this state but was not present in this state when the customerrelationship was established, if:
(i) The broker-dealer is registered under the Securities Exchange Act of1934 or not required to be registered under the Securities Exchange Act of1934 and is registered under the securities laws of the state in which thecustomer relationship was established and where the customer had maintained aprincipal place of residence; and
(ii) Within forty-five days after the customer's first transaction inthis state, the person files an application for registration as abroker-dealer in this state and a further transaction is not effected morethan seventy-five days after the date on which the application is filed, or,if earlier, the date on which the commissioner notifies the person that thecommissioner has denied the application for registration or has stayed thependency of the application for good cause;
(G) Not more than three customers in this state during the previoustwelve months, in addition to those customers specified in subparagraphs (A)to (F) and under subparagraph (H), if the broker-dealer is registered underthe Securities Exchange Act of 1934 or not required to be registered under theSecurities Exchange Act of 1934 and is registered under the securities act ofthe state in which the broker-dealer has its principal place of business; and
(H) Any other person exempted by rule adopted or order issued under thisact; and
(2) A person that deals solely in United States government securitiesand is supervised as a dealer in government securities by the Board ofGovernors of the Federal Reserve System, the Comptroller of the Currency, theFederal Deposit Insurance Corporation, or the Office of Thrift Supervision.
(c) It is unlawful for a broker-dealer, or for an issuer engaged inoffering, offering to purchase, purchasing, or selling securities in thisstate, directly or indirectly, to employ or associate with an individual toengage in an activity related to securities transactions in this state if theregistration of the individual is suspended or revoked or the individual isbarred from employment or association with a broker-dealer, an issuer, aninvestment adviser, or a federal covered investment adviser by an order of thecommissioner under this act, the Securities and Exchange Commission, or aself-regulatory organization. A broker-dealer or issuer does not violate thissubsection if the broker-dealer or issuer did not know and in the exercise ofreasonable care could not have known, of the suspension, revocation, or bar.Upon request from a broker-dealer or issuer and for good cause, an order underthis act may modify or waive, in whole or in part, the application of theprohibitions of this subsection to the broker-dealer.
(d) A rule adopted or order issued under this act may permit:
(1) A broker-dealer that is registered in Canada or other foreignjurisdiction and that does not have a place of business in this state toeffect transactions in securities with or for, or attempt to effect thepurchase or sale of any securities by:
(A) An individual from Canada or other foreign jurisdiction who istemporarily present in this state and with whom the broker-dealer had a bonafide customer relationship before the individual entered the United States;
(B) An individual from Canada or other foreign jurisdiction who ispresent in this state and whose transactions are in a self-directed taxadvantaged retirement plan of which the individual is the holder orcontributor in that foreign jurisdiction; or
(C) An individual who is present in this state, with whom thebroker-dealer customer relationship arose while the individual was temporarilyor permanently resident in Canada or the other foreign jurisdiction; and
(2) An agent who represents a broker-dealer that is exempt under thissubsection to effect transactions in securities or attempt to effect thepurchase or sale of securities in this state as permitted for a broker-dealerdescribed in paragraph (1).
Broker-dealer registration requirement and exemptions.
409.4-401. (a) It is unlawful for a person to transact business in thisstate as a broker-dealer unless the person is registered under this act as abroker-dealer or is exempt from registration as a broker-dealer undersubsection (b) or (d).
(b) The following persons are exempt from the registration requirementof subsection (a):
(1) A broker-dealer without a place of business in this state if itsonly transactions effected in this state are with:
(A) The issuer of the securities involved in the transactions;
(B) A broker-dealer registered under this act or not required to beregistered as a broker-dealer under this act;
(C) An institutional investor;
(D) A nonaffiliated federal covered investment adviser with investmentsunder management in excess of one hundred million dollars acting for theaccount of others pursuant to discretionary authority in a signed record;
(E) A bona fide preexisting customer whose principal place of residenceis not in this state and the person is registered as a broker-dealer under theSecurities Exchange Act of 1934 or not required to be registered under theSecurities Exchange Act of 1934 and is registered under the securities act ofthe state in which the customer maintains a principal place of residence;
(F) A bona fide preexisting customer whose principal place of residenceis in this state but was not present in this state when the customerrelationship was established, if:
(i) The broker-dealer is registered under the Securities Exchange Act of1934 or not required to be registered under the Securities Exchange Act of1934 and is registered under the securities laws of the state in which thecustomer relationship was established and where the customer had maintained aprincipal place of residence; and
(ii) Within forty-five days after the customer's first transaction inthis state, the person files an application for registration as abroker-dealer in this state and a further transaction is not effected morethan seventy-five days after the date on which the application is filed, or,if earlier, the date on which the commissioner notifies the person that thecommissioner has denied the application for registration or has stayed thependency of the application for good cause;
(G) Not more than three customers in this state during the previoustwelve months, in addition to those customers specified in subparagraphs (A)to (F) and under subparagraph (H), if the broker-dealer is registered underthe Securities Exchange Act of 1934 or not required to be registered under theSecurities Exchange Act of 1934 and is registered under the securities act ofthe state in which the broker-dealer has its principal place of business; and
(H) Any other person exempted by rule adopted or order issued under thisact; and
(2) A person that deals solely in United States government securitiesand is supervised as a dealer in government securities by the Board ofGovernors of the Federal Reserve System, the Comptroller of the Currency, theFederal Deposit Insurance Corporation, or the Office of Thrift Supervision.
(c) It is unlawful for a broker-dealer, or for an issuer engaged inoffering, offering to purchase, purchasing, or selling securities in thisstate, directly or indirectly, to employ or associate with an individual toengage in an activity related to securities transactions in this state if theregistration of the individual is suspended or revoked or the individual isbarred from employment or association with a broker-dealer, an issuer, aninvestment adviser, or a federal covered investment adviser by an order of thecommissioner under this act, the Securities and Exchange Commission, or aself-regulatory organization. A broker-dealer or issuer does not violate thissubsection if the broker-dealer or issuer did not know and in the exercise ofreasonable care could not have known, of the suspension, revocation, or bar.Upon request from a broker-dealer or issuer and for good cause, an order underthis act may modify or waive, in whole or in part, the application of theprohibitions of this subsection to the broker-dealer.
(d) A rule adopted or order issued under this act may permit:
(1) A broker-dealer that is registered in Canada or other foreignjurisdiction and that does not have a place of business in this state toeffect transactions in securities with or for, or attempt to effect thepurchase or sale of any securities by:
(A) An individual from Canada or other foreign jurisdiction who istemporarily present in this state and with whom the broker-dealer had a bonafide customer relationship before the individual entered the United States;
(B) An individual from Canada or other foreign jurisdiction who ispresent in this state and whose transactions are in a self-directed taxadvantaged retirement plan of which the individual is the holder orcontributor in that foreign jurisdiction; or
(C) An individual who is present in this state, with whom thebroker-dealer customer relationship arose while the individual was temporarilyor permanently resident in Canada or the other foreign jurisdiction; and
(2) An agent who represents a broker-dealer that is exempt under thissubsection to effect transactions in securities or attempt to effect thepurchase or sale of securities in this state as permitted for a broker-dealerdescribed in paragraph (1).
