Paul S. Lawler is an Associate in our Tampa office
Rule 15a-6 under the Securities Exchange Act of 1934 provides conditional exemptions from broker-dealer registration for foreign broker-dealers that engage in certain specified activities involving U.S. investors. These activities include:
- effecting unsolicited securities transactions
- providing research reports to major U.S. institutional investors and effecting transactions in the subject securities with or for those investors
- soliciting and effecting transactions with or for U.S. institutional investors or major U.S. institutional investors through a "chaperoning broker-dealer"
- soliciting and effecting transactions with or for registered broker-dealers, banks acting in a broker or dealer capacity, certain international organizations, foreign persons temporarily present in the U.S., U.S. citizens resident abroad, and foreign branches and agencies of U.S. persons
Since the adoption of Rule 15a-6, the SEC has provided guidance by way of various no-action letters. On March 21, 2013, the SEC released a series of frequently asked questions (FAQs) to provide additional guidance with respect to the operation of Rule 15a-6. The FAQs cover a variety of topics, including:
- whether a foreign broker-dealer that effects an unsolicited transaction on behalf of a U.S. investor in reliance on Rule 15a-6(a)(1) may send confirmations and account statements to the U.S. investor in connection with the transaction
- whether the staff's position in previous no-action letters applies generally to foreign broker-dealers not affiliated with a registered broker-dealer
- whether a foreign broker-dealer may rely on the exemption in Rule 15a-6(a)(1) to effect more than one unsolicited securities transaction on behalf of a single U.S. investor
- the minimum net capital requirement applicable to broker-dealers in connection withchaperoning arrangements with foreign broker-dealers
The FAQs may be found at: http://www.sec.gov/divisions/marketreg/faq-15a-6-foreign-bd.htm
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.