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Chapter 08
Securities

Article

1. Registration, Notice, and Regulation of Broker-Dealers, Agents, State Investment Advisers, and Federal Covered Advisers, and Investment Adviser Representatives. (3 AAC 08.005 - 3 AAC 08.070)

2. Registration and Notice of Securities. (3 AAC 08.080 - 3 AAC 08.230)

3. Alaska Native Claims Act Corporations: Solicitation of Proxies. (3 AAC 08.300 - 3 AAC 08.365)

4. "Regulation D" Registration and Notice Procedure. (3 AAC 08.500 - 3 AAC 08.540)

5. Small Corporate Offering Registration SCOR Procedure. (3 AAC 08.600 - 3 AAC 08.650)

6. Viatical Settlement Interests. (3 AAC 08.700 - 3 AAC 08.740)

7. Small Intrastate Securities Offerings. (3 AAC 08.810 - 3 AAC 08.895)

8. General Provisions. (3 AAC 08.900 - 3 AAC 08.950)

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Article 1
Registration, Notice, and Regulation of Broker-Dealers, Agents, State Investment Advisers, and Federal Covered Advisers, and Investment Adviser Representatives

Section

5. Scope.

7. Applicability of registration requirements to supervised persons of state investment advisers.

10. Registration; notice; exemptions to registration; waivers for dual representation.

11. Initial applications and notices; effective dates of applications and notices.

12. Exemptions from qualifying examination.

13. Qualification requirements for registration of investment adviser representatives.

14. Renewal of registration or notice; effective date of renewal or notice.

15. Fees and assessments.

16. Transferred or successor registration or notice.

17. Central registration depository system.

18. Amendments to filings.

20. (Repealed).

21. Financial reports, minimum capital requirements, bonds, and record keeping requirements of broker-dealers.

23. (Repealed).

25. Bonding requirements for certain state investment advisers.

27. Minimum financial requirements for state investment advisers.

29. Custody of client funds or securities by state investment advisers.

30. Books and records of broker-dealers.

31. (Repealed).

40. Books and records of state investment advisers.

42. Books and records of agents of issuers.

50. Effectiveness and post-effective requirements.

53. Disclosures to clients.

55. Advertising on the internet by issuers, broker-dealers, state investment advisers, broker-dealer agents, and investment adviser representatives.

60. (Repealed).

61. (Repealed).

62. Fraudulent practices of issuers and persons acting on an issuer's behalf.

65. Sales of securities at financial institutions.

70. (Repealed).

75. Failure to cooperate.

3 AAC 08.005. Scope

(a) The applicable provisions of 3 AAC 08.005 - 3 AAC 08.070 set out the regulatory standards for registration, exemption to registration, renewal of registration, qualification and examination requirements, required fees, effective dates of registration, and related matters for the following occupations under AS 45.55:

(1) broker-dealer;

(2) agent;

(3) state investment adviser;

(4) investment adviser representatives.

(b) The applicable provisions of 3 AAC 08.010 - 3 AAC 08.018 also set out the regulatory standards for the administrator's acceptance of filing of notice and renewal of notice, required fees, required filings, effective date of notice, renewal of notice on federal covered investment advisers, and related matters.

History: Eff. 10/1/99, Register 151

Authority: AS 45.55.040

AS 45.55.050

AS 45.55.060

AS 45.55.950

3 AAC 08.007. Applicability of registration requirements to supervised persons of state investment advisers

For purposes of determining whether, by providing to clients who are natural persons the services described in AS 45.55.990 (15)(A)(i), the supervised person of a state investment adviser is an investment adviser representative subject to the requirements of AS 45.55 and this chapter, "clients who are natural persons" as defined in AS 45.55.990 (8) does not include natural persons who are "qualified clients" under 17 C.F.R. 275.205-3(d)(1).

History: Eff. 4/19/2000, Register 154

Authority: AS 45.55.030

AS 45.55.950

AS 45.55.990

3 AAC 08.010. Registration; notice; exemptions to registration; waivers for dual representation

(a) A broker-dealer, an agent, an investment adviser representative, or a state investment adviser may be registered or have the registration renewed under AS 45.55, if the administrator finds that the applicant

(1) is qualified;

(2) has sufficient training, knowledge and experience in the securities business;

(3) is of good repute; and

(4) has otherwise fully satisfied the requirements of AS 45.55 and this chapter.

(b) A federal covered adviser may file initial and renewal notices to provide advisory services under AS 45.55 by filing notice with the administrator and paying applicable fees set out in 3 AAC 08.015.

(c) A broker-dealer may not transact business as a state investment adviser in this state unless the broker-dealer's registration or renewal of registration specifies training, experience, and knowledge as a state investment adviser. A broker-dealer may not transact business in this state as a federal covered adviser unless the broker-dealer has provided notice to the administrator and paid applicable fees set out in 3 AAC 08.015.

(d) In addition to complying with AS 45.55 and this chapter, a foreign corporation doing business in this state as a broker-dealer, an agent, a federal covered adviser, or a state investment adviser must register under AS 10.06 before doing business in this state, unless exempted under AS 10.06.718 .

(e) Unless the administrator grants a waiver under (f) of this section, an agent, including a partner, an officer, or a director who registers as an agent, may not be registered for more than one broker-dealer, one issuer, one state investment adviser, or one federal covered adviser, or for a combination of one state investment adviser and one federal covered adviser. However, an agent may register to be an agent for any combination of the occupations listed in this subsection, so long as the combination does not result in the agent being registered for

(1) two or more broker-dealers;

(2) two or more issuers;

(3) two or more state investment advisers;

(4) two or more federal covered advisers; or

(5) a combination of

(A) one or more state investment advisers; and

(B) one or more federal investment advisers.

(f) A request for a waiver from the dual representation restriction set out in (e) of this section may be submitted to the administrator. The administrator will, in the administrator's discretion, grant the request submitted under this subsection if

(1) the management and controlling persons are essentially identical of the following:

(A) broker-dealers;

(B) issuers;

(C) state investment advisers;

(D) federal covered advisers;

(2) a conflict of interest does not exist if the waiver is granted by the administrator;

(3) the administrator finds that the need for a waiver is fully justified;

(4) each issuer, broker-dealer, state investment adviser, or federal covered adviser for which an application has been made has acknowledged by written consent the dual registration and the need for the waiver; and

(5) if the application concerns other occupations not involving the securities business, dual representation already exists among those applicants.

History: Eff. 2/20/72, Register 41; am 10/1/99, Register 151

Authority: AS 45.55.040

AS 45.55.050

AS 45.55.060

AS 45.55.950

3 AAC 08.011. Initial applications and notices; effective dates of applications and notices

(a) This section sets out the regulatory requirements for submitting initial applications for broker-dealers, issuers, agents, state investment advisers, and investment adviser representatives. This section also sets out requirements for the administrator's acceptance of filing of initial notices by federal covered advisers. The section also establishes the effective dates of the initial applications and notices.

(b) An application for initial broker-dealer registration for broker-dealers that are not NASD members and are not required by federal law to become NASD members shall be made by submitting the following items to the administrator:

(1) a complete current, signed SEC Form BD, or its successor, with "AK" checked in item two of page two, and the appropriate schedules to the form;

(2) a copy of the most recent

(A) audited financial statements; and

(B) a SEC Form X-17A-5, or its successor, which is commonly known as the "focus report";

(3) documents showing that the applicant is registered with the SEC, if the applicant is not a member of the NASD and is not required by federal law to become an NASD member;

(4) applicable fees set out in 3 AAC 08.015.

(c) An application for initial registration for broker-dealers that are NASD members or are required by federal law to become NASD members must be made through the NASDR's Central Registration Depository (CRD), or any successor system. The broker-dealer shall comply with applicable NASD rules regarding filing requirements, dates, and payments of applicable fees set out in 3 AAC 08.015, and must check "AK" in item two of page two of SEC Form BD. The administrator will consider an application for registration filed on the date on which notice of intention to register in this state is received by the administrator from the NASD.

(d) Unless the application for initial broker-dealer registration is made effective earlier by the administrator, registration becomes effective at noon on the thirtieth day after an application is filed and the applicable fee set out in 3 AAC 08.015 is paid if

(1) a denial order is not in effect concerning the applicant;

(2) a proceeding is not pending under AS 45.55.060 concerning the applicant; and

(3) the administrator has not initiated an investigation of the application under AS 45.55.910 .

(e) A broker-dealer whose registration is effective in this state may file an initial agent registration by submitting the following items:

(1) if the broker-dealer is not an NASD member and is not required by federal law to become an NASD member, the broker-dealer must file with the administrator

(A) a signed, complete NASDR Form U-4 for each agent with "AK" checked as location for registration;

(B) documents demonstrating that each agent has passed the NASDR Series 63 examination and any other applicable NASDR examination; and

(C) the applicable fee as set out in 3 AAC 08.015 for each agent;

(2) if the broker-dealer is an NASD member or is required by federal law to become an NASD member, the broker-dealer must

(A) make application through the CRD, or its successor;

(B) comply with applicable NASD rules regarding filing requirements, dates, and payments of applicable fees set out in 3 AAC 08.015;

(C) submit documents demonstrating that each agent has passed the NASDR Series 63 or Series 66 examination and any other applicable NASDR examination.

(f) The administrator will consider an application for registration under (e)(2) of the section as filed with the administrator on the day on which notice of intention to register in this state is received by the administrator from the NASD.

(g) Initial registration of an agent under AS 45.55 becomes effective as follows:

(1) if the broker-dealer is not an NASD member and is not required by federal law to become an NASD member,

(A) if the agent is not seeking dual registration and has indicated no affirmative response to any part of question 23 of NASDR Form U-4, or its successor, the application for registration becomes effective as of

(i) the effective date of the registration for broker-dealer if both applications are submitted together; or

(ii) the date that the items in (e)(1) of this section are received by the administrator;

(B) if the agent is not seeking dual registration and has indicated an affirmative response to any part of question 23 of NASDR Form U-4, or its successor, unless the application is made effective earlier by the administrator, the registration becomes effective at noon on the thirtieth day after the application and the items in (e)(1) are filed, if

(i) a denial order is not in effect concerning the application;

(ii) a proceeding is not pending concerning the applicant under AS 45.55.060 ; and

(iii) the administrator has not initiated an investigation of the application under AS 45.55.910 ;

(2) if the broker-dealer is an NASD member or is required by federal law to become an NASD member,

(A) the application for registration becomes effective as of the date that

(i) the items in (e)(2) of this section are filed with the CRD, or its successor if the agent has indicated no affirmative response to any part of question 23 of NASDR Form U-4, or its successor; and

(ii) is not seeking dual registration;

(B) unless the application is made effective on the CRD earlier by the administrator, the application for registration becomes effective at noon on the thirtieth day after the application and items in (e)(2) are filed with the CRD if the agent is not seeking dual registration and has indicated an affirmative response to any part of question 23 of NASDR Form U-4 and

(i) a denial order is not in effect concerning the applicant;

(ii) a proceeding is not pending concerning the applicant under AS 45.55.060 ; and

(iii) the administrator has not initiated an investigation under AS 45.55.910 .

(h) An issuer may file initial application for registration of an agent with the administrator containing the following:

(1) a signed complete NASDR Form U-4, or its successor, for each agent;

(2) documents demonstrating that each agent has passed the NASDR Series 63 or Series 66 examination, unless waived by the administrator; and

(3) the applicable fees set out in 3 AAC 08.015 for each agent.

(i) Unless the administrator makes the issuer's initial application for registration of an agent effective earlier, the registration becomes effective at noon on the thirtieth day after the application and items listed in (h) are filed with the administrator if the agent is not seeking dual registration; and

(1) an affirmative response is not made to question 23 of NASDR Form U-4;

(2) a denial order is not in effect concerning the applicant;

(3) a proceeding is not pending concerning the applicant under AS 45.55.060 ; and

(4) the administrator has not initiated an investigation under AS 45.55.910 .

(j) A person may file an initial application to register as a state investment adviser by submitting the following with the administrator:

(1) a complete, current, signed SEC Form ADV, or it successor;

(2) a surety bond on a State of Alaska Form 08-100 or its successor, if required by 3 AAC 08.025;

(3) a complete, current, and signed NASDR Form U-4, or its successor, for each investment adviser representative together with evidence that the investment adviser representative has satisfied the qualification requirements of 3 AAC 08.013;

(4) applicable fees for the applicant and each investment adviser representative as set out in 3 AAC 08.015.

(k) Unless the administrator makes the application effective earlier, the registration for initial state investment adviser registration is effective at noon on the thirtieth day after an application is filed if

(1) the applicable fee set out under 3 AAC 08.015 has been paid;

(2) a denial order is not in effect concerning the applicant;

(3) a proceeding is not pending under AS 45.55.060 concerning the applicant; and

(4) the administrator has not initiated an investigation of the application under AS 45.55.910 .

(l) Unless the administrator has set an earlier date, initial registration of the investment adviser representative is effective as follows:

(1) if the investment adviser representative is not seeking dual registration and has indicated no affirmative response to any part of question 23 of NASDR Form U-4, or its successor, the application for registration becomes effective as of the date of effectiveness of the registration of the state investment adviser if both applications are submitted together, or as of the date that the administrator receives all required items in this section and applicable fees if the state investment adviser is already registered under AS 45.55;

(2) if the investment adviser representative is not seeking dual registration and has indicated an affirmative response to any part of question 23 of NASDR Form U-4, or its successor, the registration is effective at noon of the thirtieth day after the application and items in (j)(3) and (j)(4) of this section are filed with the administrator if the registration as a state investment adviser is already effective; and

(A) a denial order is not in effect;

(B) a proceeding is not pending under AS 45.55.060 ; and

(C) the administrator has not initiated an investigation of the application under AS 45.55.910 .

(m) A federal covered adviser may file an initial notice to provide advisory services in this state by submitting an optional cover letter stating the notice of intent to provide advisory services as a federal covered adviser and filing the following with the administrator:

(1) a complete, current, signed SEC Form ADV, or its successor, as filed with the SEC, and a copy of the most current SEC Schedule I, or its successor;

(2) a complete, current, and signed NASDR Form U-4, or any similar document as filed with the SEC, for each investment adviser representative having a place of business in this state and evidence that the investment adviser representative has satisfied the qualification requirements of 3 AAC 08.013; and

(3) applicable fees for the federal covered adviser filing notice, and for each investment adviser representative as set out in 3 AAC 08.015.

(n) The initial notice given by federal covered adviser is effective as of the date of receipt of the notice by the administrator, or the date of filing with the SEC, whichever is later. The initial registration for investment adviser representatives of the federal covered adviser is effective in a manner essentially the same as for investment adviser representatives of state investment advisers described in (l) of this section.

(o) The administrator will, in the administrator's discretion, request the applicant to submit additional exhibits or information not specifically required but essential to a full presentation of all material facts relating to an applicant's qualifications. The applicant shall furnish to the administrator and properly identify as the additional exhibits or information requested by the administrator. The applicant may also furnish any other exhibits or information desired relating to the applicant's qualifications.

(p) The administrator may determine an application abandoned if the applicant

(1) has not passed each required qualifying examination, if any, within 180 days after application;

(2) has failed to receive registration approval within 90 days after the application from the state of primary jurisdiction;

(3) has failed to respond within 60 days after receipt of the administrator's request for information under (o) of this section; or

(4) has failed to respond within 30 days after receipt of an administrator's request under AS 45.55.910 .

History: Eff. 2/20/72, Register 41; am 10/1/99, Register 151; am 4/19/2000, Register 154; am 1/17/2016, Register 217

Authority: AS 45.55.040

AS 45.55.050

AS 45.55.060

AS 45.55.950

Editor's note: Effective Register 154 (July 2000), the revisor of regulations made a technical amendment in 3 AAC 08.011 to reflect a manifest error in reference to a question number of NASDR Form U-4.

3 AAC 08.012. Exemptions from qualifying examination

The administrator will, in the administrator's discretion, exempt an applicant or a class of applicants from passing a qualifying examination required by AS 45.55 or this chapter, if granting the exemption is consistent with the purposes intended by policy and AS 45.55.

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