15 U.S. Code § 78o - Registration and regulation of brokers and dealers

It shall be unlawful for any facility of a national securities exchange) to make use of the mails or any means or instrumentality of interstate commerce to effect any transactions in, or to induce or attempt to induce the (2)

institute proceedings to determine whether registration should be denied. Such proceedings shall include notice of the grounds for denial under consideration and opportunity for hearing and shall be concluded within one hundred twenty days of the date of the filing of the application for registration. At the conclusion of such proceedings, the The (2)

Any municipal securities dealer or municipal securities broker, who so acts through a separately identifiable department or division, and who so acted in such a manner on June 4, 1975 , may, in accordance with such terms and conditions as the (C)

Within six months of the date of the granting of registration to a member, shall conduct an inspection of the (3)

Any provision of this chapter (other than section 78e of this title and subsection (a) of this section) which prohibits any act, practice, or course of business if the mails or any means or instrumentality of (4) The person associated with such (A)

has willfully made or caused to be made in any application for registration or report required to be filed with the state in any such application or report any material fact which is required to be stated therein.

(B) has been convicted within ten years preceding the filing of any application for registration or at any time thereafter of any felony or misdemeanor or of a substantially equivalent crime by a foreign court of competent jurisdiction which the (i)

involves the purchase or security, the taking of a false oath, the making of a false report, bribery, perjury, burglary, any substantially equivalent activity however denominated by the laws of the relevant foreign government, or conspiracy to commit any such offense;

arises out of the conduct of the business of a municipal securities dealer municipal advisor,,[1]Commodity Exchange Act (7 U.S.C. 1 et seq.) or any substantially equivalent foreign statute or regulation;

involves the larceny, theft, robbery, extortion, forgery, counterfeiting, fraudulent concealment, embezzlement, fraudulent conversion, or misappropriation of funds, or securities, or substantially equivalent activity however denominated by the laws of the relevant foreign government; or

involves the violation of section 152, 1341, 1342, or 1343 or chapter 25 or 47 of title 18 or a violation of a substantially equivalent foreign statute.

is permanently or temporarily enjoined by order, judgment, or decree of any court of competent jurisdiction from acting as an municipal securities dealer municipal advisor,, 1 Commodity Exchange Act or any substantially equivalent foreign statute or regulation, or as anCommodity Exchange Act or any substantially equivalent foreign statute or regulation, or from engaging in or continuing any conduct or practice in connection with any such activity, or in connection with the (D)

has willfully violated any provision of the Securities Act of 1933 [15 U.S.C. 77a et seq.], the Investment Advisers Act of 1940 [15 U.S.C. 80b–1 et seq.], the Investment Company Act of 1940 [15 U.S.C. 80a–1 et seq.], the Commodity Exchange Act, this chapter, the rules or regulations under any of such statutes, or the rules of the Municipal Securities Rulemaking Board, or is unable to comply with any such provision.

(E) has willfully aided, abetted, counseled, commanded, induced, or procured the violation by any other Securities Act of 1933, the Investment Advisers Act of 1940, the Investment Company Act of 1940, the Commodity Exchange Act, this chapter, the rules or regulations under any of such statutes, or the rules of the Municipal Securities Rulemaking Board, or has failed reasonably to supervise, with a view to preventing violations of the provisions of such statutes, rules, and regulations, another person, if—

there have been established procedures, and a system for applying such procedures, which would reasonably be expected to prevent and detect, insofar as practicable, any such violation by such other (ii)

made or caused to be made in any application for registration or report required to be filed with a foreign financial regulatory authority, or in any proceeding before a foreign financial regulatory authority with respect to registration, any statement that was at the time and in the light of the circumstances under which it was made false or misleading with respect to any material fact, or has omitted to state in any application or report to the foreign financial regulatory authority any material fact that is required to be stated therein;

violated any foreign statute or regulation regarding transactions in securities, or contracts of sale of a commodity for future delivery, traded on or subject to the rules of a contract market or any board of trade;

aided, abetted, counseled, commanded, induced, or procured the violation by any foreign financial regulatory authority regarding transactions in securities, or contracts ofboard of trade, or has been found, by a foreign financial regulatory authority, to have failed reasonably to supervise, with a view to preventing violations of such statutory provisions, rules, and regulations, another (H) is subject to any final order of a commission (or any agency or officer performing like functions), banks, savings associations, or credit unions, commission (or any agency or office performing like functions), an appropriate Federal banking agency (as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(q))), or the National Credit Union Administration , that—

bars such commission, authority, agency, or officer, or from engaging in the business of securities, insurance, banking, savings association activities, or credit union activities; or

constitutes a final order based on violations of any laws or regulations that prohibit fraudulent, manipulative, or deceptive conduct.

Pending final determination whether any registration under this subsection shall be revoked, the registered broker or dealer may, upon such terms and conditions as the Commission. If theregistered broker or dealer is no longer in existence or has ceased to do business as a (6)

(A) With respect to any person, or suspend for a period not exceeding 12 months, or bar any suchmunicipal securities dealer, municipal advisor,nationally recognized statistical rating organization, or from participating in an offering of penny stock, if the person—

has committed or omitted any act, or is subject to an order or finding, enumerated in subparagraph (A), (D), (E), (H), or (G) of paragraph (4) of this subsection;

has been convicted of any offense specified in subparagraph (B) of such paragraph (4) within 10 years of the commencement of the proceedings under this paragraph; or

is enjoined from any action, conduct, or practice specified in subparagraph (C) of such paragraph (4).

require persons in any such class to pass tests prescribed in accordance with such rules and regulations, which tests shall, with respect to any class of partners, officers, or supervisory employees (which latter term may be defined by the dealers) engaged in the management of the control over cash and securities, supervision of employees, maintenance of records, and other appropriate matters; and

It shall be unlawful for any registered broker or dealer to effect any transaction in, or induce or attempt to induce the[2] commercial paper, bankers’ acceptances, or commercial bills), unless suchsection 78o–3 of this title or effects transactions in securities solely on a national securities member.

For the purposes of determining whether a 78f(c)(2), 78o–3(g)(2), or 78q–1(b)(4)(A) of this title, the term “Commission” in paragraph (4)(B) of this subsection shall mean “exchange”, “association”, or “clearing agency”, respectively.

Notwithstanding paragraphs (1) and (2), a security futures products on ansection 78f(g) of this title may register for purposes of this section by filing with the (ii) Immediate effectiveness.—

Such registration shall be effective contemporaneously with the submission of notice, in written or electronic form, to the (iii) Suspension.—

Such registration shall be suspended immediately if a national securities association registered pursuant to section 78o–3(k) of this title suspends the membership of that (iv) Termination.—

Such registration shall be terminated immediately if any of the above stated conditions for registration set forth in this paragraph are no longer satisfied.

does not directly accept or solicit orders from public customers or provide advice to public customers in connection with the trading of security futures products.

Except as provided in subparagraph (B), an M&A broker shall be exempt from registration under this section.

(B) Excluded activities.— An M&A broker is not exempt from registration under this paragraph if such broker does any of the following:

Directly or indirectly, in connection with the transfer of ownership of an eligible privately held company, receives, holds, transmits, or has custody of the funds or securities to be exchanged by the parties to the transaction.

Engages on behalf of an issuer in a public offering of any class of securities that is registered, or is required to be registered, with the section 78l of this title or with respect to which the (iii)

Engages on behalf of any party in a transaction involving a shell company, other than a business combination related shell company.

Directly, or indirectly through any of its affiliates, provides financing related to the transfer of ownership of an eligible privately held company.

complying with all other applicable laws in connection with such assistance, including, if applicable, Regulation T (12 C.F.R. 220 et seq.); and

Represents both the buyer and the seller in the same transaction without providing clear written disclosure as to the parties the (vii)

Facilitates a transaction with a group of buyers formed with the assistance of the M&A broker to acquire the eligible privately held company.

Engages in a transaction involving the transfer of ownership of an eligible privately held company to a passive buyer or group of passive buyers.

(C) Disqualification.— An M&A broker is not exempt from registration under this paragraph if such broker (and if and as applicable, including any officer, member, manager, partner, or employee of such broker)—

Nothing in this paragraph shall be construed to limit any other authority of the person, or any class of (E) Definitions.— In this paragraph:

(i) Business combination related shell company.— The term “business combination related shell company” means a shell company that is formed by an entity that is not a shell company—

solely for the purpose of changing the corporate domicile of that entity solely within the United (II)

solely for the purpose of completing a business combination transaction (as defined under section 230.165(f) of title 17, Code of Federal Regulations) among one or more entities other than the shell company.

(ii) Control.— The term “control” means the power, directly or indirectly, to direct the management or policies of acontrol if, upon completion of a transaction, the buyer or group of buyers—

has the right to vote 25 percent or more of a class of voting securities or the power to sell or direct the sale of 25 percent or more of a class of voting securities; or

in the case of a partnership or limited liability company, has the right to receive upon dissolution, or has contributed, 25 percent or more of the capital.

(iii) Eligible privately held company.— The term “eligible privately held company” means a privately held (I)

The company does not have any class of securities registered, or required to be registered, with the section 78l of this title or with respect to which the (II) In the fiscal year ending immediately before the fiscal year in which the services of the M&A broker are initially engaged with respect to the securities transaction, the records of the company):

The earnings of the company before interest, taxes, depreciation, and amortization are less than $25,000,000.

For purposes of this subclause, the (iv) M&A broker.— The term “M&A broker” means aeligible privately held company, regardless of whether the broker acts on behalf of a seller or buyer, through the purchase, sale,eligible privately held company, if the broker reasonably believes that—

(I) upon consummation of the transaction, any eligible privately held company, acting alone or in concert—

will control the eligible privately held company or the business conducted with the assets of the eligible privately held company; and

(bb) directly or indirectly, will be active in the management of the eligible privately held company or the business conducted with the assets of the eligible privately held company, including without limitation, for example, by—

(i) In general.— On the date that is 5 years after December 29, 2022 , and every 5 years thereafter, each dollar amount in subparagraph (E)(iii)(II) shall be adjusted by—

dividing the annual value of the Employment Cost Index For Wages and Salaries, Private Industry Workers (or any successor index), as published by the Bureau of Labor Statistics , for the calendar year preceding the calendar year in which the adjustment is being made by the annual value of such index (or successor) for the calendar year ending December 31, 2020 ; and

No interstate commerce to effect any transaction in, or to induce or attempt to induce thesecurity-based swap agreement by means of any manipulative, deceptive, or other fraudulent device or contrivance.

No municipal securities dealer shall make use of the mails or any means or instrumentality ofsecurity-based swap agreement involving a municipal (C)

No interstate commerce to effect any transaction in, or to induce or attempt to induce the member, in connection with which such (B)

No municipal securities dealer shall make use of the mails or any means or instrumentality ofmunicipal securities dealer engages in any fraudulent, deceptive, or manipulative act or practice, or makes any fictitious quotation.

The government securities; or (ii) impose any burden on competition not necessary or appropriate in furtherance of the purposes of this section, the (3)

Consistent with this chapter, the Commodity Futures Trading Commission , shall issue such rules, regulations, or orders as are necessary to avoid duplicative or conflicting regulations applicable to anyCommodity Futures Trading Commission pursuant to section 4f(a) of the Commodity Exchange Act [7 U.S.C. 6f(a)] (except paragraph (2) thereof), with respect to the application of: (i) the provisions of section 78h of this title, subsection (c)(3), and section 78q of this title and the rules and regulations thereunder related to the treatment of customer funds, securities, or property, maintenance of books and records, financial reporting, or other financial responsibility rules, involving security futures products; and (ii) similar provisions of the Commodity Exchange Act [7 U.S.C. 1 et seq.] and rules and regulations thereunder involving security futures products.

Notwithstanding any provision of sections 2(a)(1)(C)(i) or 4d(a)(2) of the Commodity Exchange Act [7 U.S.C. 2(a)(1)(C)(i), 6d(a)(2)] and the rules and regulations thereunder, and pursuant to an exemption granted by thesection 78mm of this title or pursuant to a rule or regulation, cash and securities may be held by a commission merchant pursuant to section 4f(a)(1) of the Commodity Exchange Act [7 U.S.C. 6f(a)(1)], in a portfolio margining account carried as a futures account subject to section 4d of the Commodity Exchange Act [7 U.S.C. 6d] and the rules and regulations thereunder, pursuant to a portfolio margining program approved by the Commodity Futures Trading Commission , and subject to subchapter IV of chapter 7 of title 11 and the rules and regulations thereunder. TheCommodity Futures Trading Commission to adopt rules to ensure that such transactions and accounts are subject to comparable requirements to the extent practicable for similar products.

If the 78l, 78m, 78n of this title or subsection (d) or any rule or regulation thereunder has failed to comply with any such provision, rule, or regulation in any material respect, the person, and any (5)

No dealer (other than a specialist registered on a national securities exchange) acting in the capacity of market maker or otherwise shall make use of the mails or any means or instrumentality of interstate commerce to effect any transaction in, or to induce or attempt to induce the broker in that (6)

No interstate commerce to effect any transaction in, or to induce or attempt to induce the security, municipal security, commercial paper, bankers’ acceptances, or commercial bills) in contravention of such rules and regulations as theBoard of Governors of the Federal Reserve System , pursuant to section 78g of this title, to prescribe rules and regulations for the purpose of preventing the excessive use of credit for the (7)

Each issuer which has filed a registration statement containing an undertaking which is or becomes operative under this subsection as in effect prior to August 20, 1964 , and eachSecurities Act of 1933, as amended [15 U.S.C. 77a et seq.], shall file with thesection 78m of this title in respect of asection 1467a of title 12), or asection 1841 of title 12, 1,200 (2) Asset-backed securities

The security, on such terms and conditions and for such period or periods as the (B) Classification of issuers

The issuers and prescribe requirements appropriate for each class of issuers of asset-backed securities.

Every registered broker or dealer shall provide notice to its customers that they may elect not to allow their fully paid securities to be used in connection with short sales. If a sales, the (f) Compliance with this chapter by members not required to be registered

Every registered broker or dealer shall establish, maintain, and enforce written policies and procedures reasonably designed, taking into consideration the nature of such broker’s or dealer’s business, to prevent the misuse in violation of this chapter, or the rules or regulations thereunder, of material, nonpublic information by such (h) Requirements for transactions in penny stocks

contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;

contains a description of the dealer’s duties to the customer and of the rights and remedies available to the customer with respect to violations of such duties or other requirements of Federal securities laws;

contains a brief, clear, narrative description of a dealer market, including “bid” and “ask” prices for penny stocks and the significance of the spread between the bid and ask prices;

contains the toll free telephone number for inquiries on disciplinary actions established pursuant to section 78o–3(i) of this title;

defines significant terms used in the disclosure document or in the conduct of trading in penny stocks; and

contains such other information, and is in such form (including language, type size, and format), as the (3) Commission rules relating to disclosure The (A) shall require (i)

the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and

The broker’s or dealer’s commissions, commission-equivalents, and markups received from transactions in penny stocks.

as reasonably designed to prevent fraudulent, deceptive, or manipulative acts and practices with respect to penny stocks.

No law, rule, regulation, or order, or other administrative action of any margin, financial responsibility, making and keeping records, bonding, or financial or operational reporting requirements for government securities brokers, or government securities dealers that differ from, or are in addition to, the requirements in those areas established under this chapter. The commissions (or any agency or office performing like functions) of the (2) Funding portals

Except as provided in subparagraph (B), no funding portal with respect to its business as such.

Subparagraph (A) does not apply with respect to the examination and enforcement of any law, rule, regulation, or administrative action of a funding portal is located, provided that such law, rule, regulation, or administrative action is not in addition to or different from the requirements for registered funding portals established by the Commission.

on behalf of a customer that, for 30 days prior to the day of the transaction, maintained an account with the (II) by an associated (aa)

on behalf of a customer that, for 30 days prior to the day of the transaction, maintained an account with the (II) during the period beginning on the date on which such associated (aa)

if the customer is present in another (j) [4] Rulemaking to extend requirements to new hybrid products

Prior to commencing a rulemaking under this subsection, the Board concerning the imposition ofnew hybrid product. In developing and promulgating rules under this subsection, the Board, including views with respect to the nature of the new hybrid product; the history, purpose, extent, and appropriateness of the regulation of the new product under the Federal banking laws; and the impact of the proposed rule on the banking industry.

bring an action against a bank for a failure to comply with a requirement described in subparagraph (A),

imposing such requirement is necessary and appropriate in the public interest and for the protection of investors.

the history, purpose, extent, and appropriateness of the regulation of the new hybrid product under the Federal securities laws and under the Federal banking laws.

The Board may obtain review of any final regulation described in paragraph (2) in the United (B) Transmittal of petition and record

A copy of a petition described in subparagraph (A) shall be transmitted as soon as possible by the Clerk of the Court to an officer or employee of the (C) Exclusive jurisdiction

On the date of the filing of the petition under subparagraph (A), the court has jurisdiction, which becomes exclusive on the filing of the materials set forth in subparagraph (B), to affirm and enforce or to set aside the regulation at issue.

(D) Standard of review The court shall determine to affirm and enforce or set aside a regulation of the (i)

imposing a requirement to register as a banks engaging in transactions in such product is appropriate in light of the history, purpose, and extent of regulation under the Federal securities laws and under the Federal banking laws, giving deference neither to the views of theBoard.

The filing of a petition by the Board pursuant to subparagraph (A) shall operate as a judicial stay, until the date on which the determination of the court is final (including any appeal of such determination).

Any aggrieved party may seek judicial review of the section 78y of this title.

The term “Board” means the Board of Governors of the Federal Reserve System .

The authority of the security-based swap agreements shall be subject to the restrictions and limitations of section 78c–1(b) of this title.

In determining whether to permit a foreign person, or an affiliate of a foreign (l) [6] Termination of a United

For a foreign (k) [7] Standard of conduct

Notwithstanding any other provision of this chapter or the Investment Advisers Act of 1940 [15 U.S.C. 80b–1 et seq.], the investment adviser under section 211 of the Investment Advisers Act of 1940 [15 U.S.C. 80b–11]. The receipt of compensation based on commission or other standard compensation for the (2) Disclosure of range of products offered

Where a (l) [8] Other matters The (1)

facilitate the provision of simple and clear disclosures to investors regarding the terms of their relationships with (2)

examine and, where appropriate, promulgate rules prohibiting or restricting certain sales practices, conflicts of interest, and compensation schemes for (m) Harmonization of enforcement The enforcement authority of the (1)

the enforcement authority of the Investment Advisers Act of 1940 [15 U.S.C. 80b–1 et seq.], including the authority to impose sanctions for such violations, and

Notwithstanding any other provision of the securities laws, the (2) Considerations

The municipal securities dealer to arbitrate any future dispute between them arising under the Federal securities laws, the rules and regulations thereunder, or the rules of a self-regulatory organization if it finds that such prohibition, imposition of conditions, or limitations are in the public interest and for the protection of investors.

[2] So in original. The word “or” probably should not appear.

[3] See References in Text note below.

[4] So in original. There are two subsecs. designated (j).

[5] Another subsec. (k) is set out after the first subsec. ().

[6] Another subsec. () is set out after the second subsec. (k).

[7] Another subsec. (k) is set out after the second subsec. (j).

[8] Another subsec. () is set out after the first subsec. (k).

[9] So in original. Probably should be followed by “the”.

This chapter, referred to in subsecs. (b)(2)(B), (C), (3), (4)(A), (D), (E), (11)(B), (12)(B), (13)(D), (c)(3)(B), (8), (f), (g), and (i)(1), was in the original “this title”, and this chapter, referred to in subsecs. (k)(1) and (m), was in the original “this Act”. See References in Text note set out under section 78a of this title.

The Commodity Exchange Act, referred to in subsecs. (b)(4)(B)(ii), (C) to (E) and (c)(3)(B), is act Sept. 21, 1922, ch. 369, 42 Stat. 998, which is classified generally to chapter 1 (§ 1 et seq.) of Title 7, Agriculture. For complete classification of this Act to the Code, see section 1 of Title 7 and Tables.

The Securities Act of 1933, referred to in subsecs. (b)(4)(D), (E), (c)(8), and (d)(1), is act May 27, 1933, ch. 38, title I, 48 Stat. 74, which is classified generally to subchapter 1 (§ 77a et seq.) of chapter 2A of this title. For complete classification of this Act to the Code, see section 77a of this title and Tables.

The Investment Advisers Act of 1940, referred to in subsecs. (b)(4)(D), (E), (k)(1), and (m), is title II of act Aug. 22, 1940, ch. 686, 54 Stat. 847, which is classified generally to subchapter II (§ 80b–1 et seq.) of chapter 2D of this title. For complete classification of this Act to the Code, see section 80b–20 of this title and Tables.

The Investment Company Act of 1940, referred to in subsec. (b)(4)(D), (E), is title I of act Aug. 22, 1940, ch. 686, 54 Stat. 789, which is classified generally to subchapter 1 (§ 80a–1 et seq.) of chapter 2D of this title. For complete classification of this Act to the Code, see section 80a–51 of this title and Tables.

Subsection (i) of section 78q of this title, referred to in subsec. (b)(11)(B)(vi), (12)(B)(vi), was struck out and subsec. (j) was redesignated (i) by Pub. L. 111–203, title VI, § 617(a), July 21, 2010 , 124 Stat. 1616.

Section 206 of the Gramm-Leach-Bliley Act, referred to in subsec. (j)(6)(A)(ii), (iii), is section 206 of Pub. L. 106–102, which is set out as a note under section 78c of this title.

2022—Subsec. (b)(13). Pub. L. 117–328 added par. (13).

2015—Subsec. (d). Pub. L. 114–94 substituted “case of asection 1467a of title 12),” for “case ofPub. L. 112–106, § 601(b), substituted “300section 1841 of title 12, 1,200Pub. L. 112–106, § 305(d)(1), added par. (2) and redesignated former pars. (2) and (3) as (3) and (4), respectively.

2010—Subsec. (b)(1). Pub. L. 111–203, § 985(b)(5)(A)(ii), in concluding provisions, inserted “The order granting registration shall not be effective until suchPub. L. 111–203, § 985(b)(5)(A)(i), struck out “The order granting registration shall not be effective until suchPub. L. 111–203, § 975(g)(1), inserted “municipal advisor,” after Pub. L. 111–203, § 766(d)(1), inserted Pub. L. 111–203, § 766(d)(2), substituted Pub. L. 111–203, § 925(a)(1), substituted “, or bar any suchPub. L. 111–203, § 975(g)(2), inserted Pub. L. 111–203, § 929L(3), struck out “otherwise than on a national securitiesPub. L. 111–203, § 762(d)(4)(A), struck out “(as defined in section 206B of the Gramm-Leach-Bliley Act),” after Pub. L. 111–203, § 762(d)(4)(B), struck out “(as defined in section 206B of the Gramm-Leach-Bliley Act)” after Pub. L. 111–203, § 713(a), added subpar. (C).

Subsec. (d). Pub. L. 111–203, § 942(a), inserted subsec. heading, designated existing provisions as par. (1), inserted par. heading, inserted “, other than any class of asset-backed securities,” after “securities of each class”, and added par. (2).

Subsecs. (e) to (h). Pub. L. 111–203, § 929X(c), added subsec. (e) and redesignated former subsecs. (e) to (g) as (f) to (h), respectively. Former subsec. (h) redesignated (i) relating to limitations onPub. L. 111–203, § 929X(c)(1), redesignated subsec. (h) as (i). Former subsec. (i), relating to rulemaking to extend requirements toPub. L. 111–203, § 929X(c)(1), redesignated subsec. (i), relating to rulemaking to extend requirements toPub. L. 111–203, § 762(d)(4)(C), (D), redesignated subsec. (i), relating to limitation onGramm-Leach-Bliley Act)” after Subsecs. (k), (l). Pub. L. 111–203, § 913(g)(1), added subsec. (k) relating to standard of conduct and subsec. (l) relating to other matters.

Pub. L. 111–203, § 173(c), added subsec. (k) relating to registration or succession to a UnitedPub. L. 111–203, § 913(h)(1), added subsec. (m).

2006—Subsec. (b)(4)(B)(ii), (C). Pub. L. 109–291 inserted Pub. L. 107–204, § 604(a)(1), added subpar. (F) and struck out former subpar. (F) which read as follows: “is subject to an order of thePub. L. 107–204, § 604(a)(2), added subpar. (H).

Subsec. (b)(6)(A)(i). Pub. L. 107–204, § 604(c)(1)(B)(ii), substituted “, or is subject to an order or finding,” for “or omission”.

Pub. L. 107–204, § 604(c)(1)(B)(i), substituted “(H), or (G)” for “or (G)”. See 1990 Amendment note for subsec. (b)(6) below.

Subsec. (c)(1). Pub. L. 106–554, § 1(a)(5) [title III, § 303(e)], amended par. (1) generally. Prior to amendment, par. (1) consisted of subpars. (A) to (E) prohibiting use of mails or instrumentality ofPub. L. 106–554, § 1(a)(5) [title II, § 206(h)], designated existing provisions as subpar. (A) and added subpar. (B).

Subsec. (i). Pub. L. 106–554, § 1(a)(5) [title III, § 303(f)], added subsec. (i) relating to limitation onPub. L. 106–102 added subsec. (i) relating to rulemaking to extend requirements toPub. L. 105–353, § 301(b)(8)(A), realignedPub. L. 105–353, § 301(b)(8)(B), substituted “effecting” for “affecting” in introductory provisions.

Subsec. (h)(3)(A)(i)(II)(bb). Pub. L. 105–353, § 301(b)(8)(C), inserted “or” after semicolon at end.

Subsec. (h)(3)(A)(ii)(I). Pub. L. 105–353, § 301(b)(8)(D), substituted “maintained” for “maintains”.

Subsec. (h)(3)(B)(ii). Pub. L. 105–353, § 301(b)(8)(E), substituted “associated” for “association”.

1996—Subsec. (h). Pub. L. 104–290 added subsec. (h).

1995—Subsec. (c)(8). Pub. L. 104–67 added par. (8).

1993—Subsec. (b)(1)(B). Pub. L. 103–202, § 109(b)(2), inserted “The order granting registration shall not be effective until suchSubsec. (b)(7). Pub. L. 103–202, § 106(b)(2)(B), inserted “orPub. L. 103–202, § 105(b), inserted subpar. designation “(A)” after “(1)”, substituted “contrivance.” along with subpar. designation “(B)” and “NoPub. L. 103–202, § 105(a), inserted subpar. designation “(A)” after “(2)”, substituted “fictitious quotation.” along with subpar. designation “(B)” and “NoPub. L. 103–202, § 110, added par. (7).

1990—Subsec. (b)(4)(B). Pub. L. 101–550, § 203(a)(1), inserted “or of a substantially equivalent crime by a foreign court of competent jurisdiction” after “misdemeanor”.

Subsec. (b)(4)(B)(i). Pub. L. 101–550, § 203(a)(2), inserted “any substantially equivalent activity however denominated by the laws of the relevant foreign government,” after “burglary,”.

Subsec. (b)(4)(B)(ii). Pub. L. 101–550, § 203(a)(3), inserted “foreignPub. L. 101–550, § 203(a)(4), inserted “, or substantially equivalent activity however denominated by the laws of the relevant foreign government” after “securities”.

Subsec. (b)(4)(B)(iv). Pub. L. 101–550, § 203(a)(5), inserted “or a violation of a substantially equivalent foreign statute” after “title 18”.

Subsec. (b)(4)(C). Pub. L. 101–550, § 203(a)(6), inserted “foreignCommodity Exchange Act” wherever appearing, and “foreign entity substantially equivalent to any of the above,” after Pub. L. 101–550, § 203(a)(7), added subpar. (G).

Subsec. (b)(6). Pub. L. 101–429, § 504(a), amended par. (6) generally. Prior to amendment, par. (6) read as follows: “ThePub. L. 101–550, § 203(c)(1), which directed amendment of subsec. (b)(6) by substituting “(A), (D), (E), or (G)” for “(A), (D), or (E)”, was executed by making the substitution both before and after the general amendment of subsec. (b)(6) by Pub. L. 101–429, § 504(a), which was effective 12 months after Oct. 15, 1990 , to reflect the probable intent of Congress and the subsequent amendment by Pub. L. 107–204, § 604(c)(1)(B)(i), which presumed that the substitution had taken place.

1988—Subsec. (f). Pub. L. 100–704 added subsec. (f).

1987—Subsec. (b)(4)(B)(ii). Pub. L. 100–181, § 317(1), substituted “fiduciary,Pub. L. 100–181, § 317(2), added subpar. (C) and struck out former subpar. (C) which read as follows: “is permanently or temporarily enjoined by order, judgment, or decree of any court of competent jurisdiction from acting as anCommodity Exchange Act,Pub. L. 100–181, § 317(3), substituted “seeking to become associated, or, at the time of the alleged misconduct, associated or seeking to become associated” for “or seeking to become associated,” in first sentence.

1986—Subsec. (b)(4)(A). Pub. L. 99–571, § 102(e)(1), inserted “or with any other appropriate regulatory agency”.

Subsec. (c)(4). Pub. L. 98–376, § 4, inserted reference to section 78n of this title and “and anyPub. L. 98–38, § 3(a)(1), added par. (8) and struck out former par. (8), which had directed that, in addition to the fees and charges authorized by par. (7) of this subsection, eachPub. L. 98–38, § 3(a)(2), added par. (9) and struck out former par. (9), which had provided that noPub. L. 95–213 authorized thePub. L. 94–29, § 11(1), amended section catchline.

Subsec. (a). Pub. L. 94–29, § 11(2), required registration with thePub. L. 94–29, § 11(2), expanded coverage to includePub. L. 94–29, § 11(3), expanded thePub. L. 94–29, § 11(3), expanded thePub. L. 94–29, § 11(3), inserted requirement that rules and regulations be promulgated no later than Sept. 1, 1975 , establishing minimum financial responsibility requirements for allPub. L. 94–29, § 11(4), substituted provisions authorizing thePub. L. 94–29, § 11(5), added par. (6).

1970—Subsec. (c)(3). Pub. L. 91–598 extendedPub. L. 88–467, § 6(a), designated existing provisions as par. (1) and added par. (2).

Subsec. (b)(1). Pub. L. 88–467, § 6(b), designated first par. as (1) and substituted Pub. L. 88–467, § 6(b), designated second par. as (2) and substituted “associated with the applicant” for “directly or indirectly controlling or controlled by, or under direct or indirect commonPub. L. 88–467, § 6(b), designated third par. as (3) and substituted “effective date of the registration” for “effective date thereof”.

Subsec. (b)(5). Pub. L. 88–467, § 6(b), designated first sentence of fourth par, as (5), provided for censure and for suspension for period not exceeding twelve months, substituted the language “that suchInvestment Advisers Act of 1940 and the Investment Company Act of 1940, and added clauses (E) and (F).

Subsec. (b)(6). Pub. L. 88–467, § 6(b), designated second through fifth sentences of fourth par. as (6) and, in provision constituting first sentence of par. (6) substituted “any registration under this subsection” for “any such registration” and inserted “(which may consist solely of affidavits and oral argument)” after “opportunity for hearing”.

Subsec. (b)(7) to (10). Pub. L. 88–467, § 6(b), added pars. (7) to (10).

Subsec. (d). Pub. L. 88–467, § 6(d), substituted provisions which require everySecurities Act of 1933 to file for the fiscal year in which the registration statement becomes effective such reports as may be required by thesection 78m of this title and provide for suspension of duty to file reports for any later fiscal years if at the beginning of such fiscal year the securities to which the registration statement relates are held of record by less than three hundredJune 25, 1938 , added pars. (2) and (3).

1936—Act May 27, 1936 , amended section generally.

“This section [amending this section] and any amendment made by this section shall take effect on the date that is 90 days after the date of enactment of this Act [ Dec. 29, 2022 ].”

Amendment by sections 173(c), 913(g)(1), (h)(1), 919, 921(a), 925(a)(1), 929L(3), 929X(c), 942(a), and 985(b)(5)(A) of Pub. L. 111–203 effective 1 day after July 21, 2010 , except as otherwise provided, see section 4 of Pub. L. 111–203, set out as an Effective Date note under section 5301 of Title 12,section 713(a) of Pub. L. 111–203 effective on the later of 360 days after July 21, 2010 , or, to the extent a provision of subtitle A (§§ 711–754) of title VII of Pub. L. 111–203 requires a rulemaking, not less than 60 days after publication of the final rule or regulation implementing such provision of subtitle A, see section 754 of Pub. L. 111–203, set out as a note under section 1a of Title 7, Agriculture.

Amendment by sections 762(d)(4) and 766(d) of Pub. L. 111–203 effective on the later of 360 days after July 21, 2010 , or, to the extent a provision of subtitle B (§§ 761–774) of title VII of Pub. L. 111–203 requires a rulemaking, not less than 60 days after publication of the final rule or regulation implementing such provision of subtitle B, see section 774 of Pub. L. 111–203, set out as a note under section 77b of this title.

“This section [amending this section and sections 78o–3, 78o–4, and 78q of this title], and the amendments made by this section, shall take effect on October 1, 2010 .”

Amendment by Pub. L. 106–102 effective at the end of the 18-month period beginning on Nov. 12, 1999 , see section 209 of Pub. L. 106–102, set out as a note under section 1828 of Title 12, Effective Date of 1995 Amendment

Amendment by Pub. L. 104–67 not to affect or apply to any private action arising under this chapter or title I of the Securities Act of 1933 (15 U.S.C. 77a et seq.), commenced before and pending on Dec. 22, 1995 , see section 108 of Pub. L. 104–67, set out as a note under section 77l of this title.

Amendment by section 504(a) of Pub. L. 101–429 effective 12 months after Oct. 15, 1990 , with provisions relating to civil penalties and accounting and disgorgement, see section 1(c)(2), (3)(A) of Pub. L. 101–429, set out in a note under section 77g of this title.

Amendment by section 505 of Pub. L. 101–429 effective 18 months after Oct. 15, 1990 , with provision to commence rulemaking proceedings to implement such amendment not later than 180 days after Oct. 15, 1990 , and with provisions relating to civil penalties and accounting and disgorgement, see section 1(c)(2), (3)(B), (C) of Pub. L. 101–429, set out in a note under section 77g of this title.

“The amendments made by this Act [enacting sections 78t–1, 78u–1, and 80b–4a of this title and amending this section and sections 78c, 78u, 78ff, and 78kk of this title], except for section 6 [amending sections 78c and 78u of this title], shall not apply to any actions occurring before the date of enactment of this Act [ Nov. 19, 1988 ].”

Amendment by Pub. L. 99–571 effective 270 days after Oct. 28, 1986 , see section 401 of Pub. L. 99–571, set out as an Effective Date note under section 78o–5 of this title.

Amendment by Pub. L. 98–376 effective Aug. 10, 1984 , see section 7 of Pub. L. 98–376, set out as a note under section 78c of this title.

“The amendments made by subsection (a) [amending this section] shall become effective six months after the date of enactment of this Act [ June 6, 1983 ].”

Amendment by Pub. L. 94–29 effective June 4, 1975 , except for amendment of subsec. (a) by Pub. L. 94–29 which is effective 180 days after June 4, 1975 , see section 31(a) of Pub. L. 94–29, set out as a note under section 78b of this title.

Amendment by Pub. L. 88–467 of subsec. (a) of this section effective July 1, 1964 , and of subsecs. (b), (c)(4), (5), and (d) of this section effective Aug. 20, 1964 , see section 13 of Pub. L. 88–467, set out as a note under section 78c of this title.

Nothing in amendment by Pub. L. 104–67 to be deemed to create or ratify any implied right of action, or to preventsection 203 of Pub. L. 104–67, set out as a Construction note under section 78j–1 of this title.

Amendment by sections 105, 106(b)(2)(B), and 109(b)(2) of Pub. L. 103–202 not to be construed to govern initial issuance of any public debt obligation or to grant any authority to (or extend any authority of) the Securities and Exchange Commission , any appropriate regulatory agency, or asection 111 of Pub. L. 103–202, set out as a note under section 78o–5 of this title.

whether there are legal or regulatory gaps, shortcomings, or overlaps in legal or regulatory standards in the protection of retail customers relating to the standards of care for “(c) Considerations.— In conducting the study required under subsection (b), the “(1)

whether there are legal or regulatory gaps, shortcomings, or overlaps in legal or regulatory standards in the protection of retail customers relating to the standards of care for “(3)

the standard of care applied under the Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.) for providing personalized investment advice about securities to retail customers of “(B)

“(10) the potential impact of eliminating the Investment Advisers Act of 1940 (15 U.S.C. 80b–2(a)(11)(C)), in terms of—

the impact and potential benefits and harm to retail customers that could result from such a change, including any potential impact on access to personalized investment advice and recommendations about securities to retail customers or the availability of such advice and recommendations;

“(B) the number of additional entities and individuals that would be required to register under, or become subject to, the Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.), and the additional requirements to which “(i)

enforce the standard of care and other applicable requirements imposed under the Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.);

access to personalized investment advice, and recommendations about securities to retail customers; or

retail customers regarding and the potential impact on the profitability of their investment decisions; and

“(1) In general.— Not later than 6 months after the date of enactment of this Act [ July 21, 2010 ], the “(A)

“(2) Content requirements.— The report required under paragraph (1) shall describe the findings, conclusions, and recommendations of the “(A)

an analysis of whether [sic] any identified legal or regulatory gaps, shortcomings, or overlap in legal or regulatory standards in the protection of retail customers relating to the standards of care for “(e) Public Comment.—

The maintenance of an honest and healthy primary and secondary market for securities offerings is essential to enhancing long-term capital formation and economic growth and providing legitimate investment opportunities for individuals and institutions.

Protecting investors in new securities is a critical component in the maintenance of an honest and healthy market for such securities.

Investors in the penny stock market suffer from a serious lack of adequate information concerning price and volume of penny stock transactions, the nature of this market, and the specific securities in which they are investing.

Current practices do not adequately regulate the role of ‘promoters’ and ‘consultants’ in the penny stock market, and many professionals who have been banned from the securities markets have ended up in promoter and consultant roles, contributing substantially to fraudulent and abusive schemes.

The present regulatory environment has permitted the ascendancy of the use of particular market practices, such as ‘reverse mergers’ with shell corporations and ‘blank check’ offerings, which are used to facilitate manipulation schemes and harm investors.

In light of the substantial and continuing problems in the penny stock markets, additional legislative measures are necessary and appropriate.”

Pub. L. 101–429, title V, § 504(b), Oct. 15, 1990 , 104 Stat. 953, provided that within 6 months after Oct. 15, 1990 , the Securities and Exchange Commission was to submit to each House of Congress any recommendations the Executive Documents

For transfer of functions of Securities and Exchange Commission , with certain exceptions, to Chairman of suchMay 24, 1950 , 15 F.R. 3175, 64 Stat. 1265, set out under section 78d of this title.