Rule Atlas
NASAA Uniform Securities Act · S63-1: Investment Adviser Registration: State vs. Federal Covered Status & Notice Filing
Under NASAA Uniform Securities Act · S63-1 (NASAA Uniform Securities Act), investment Adviser Registration: State vs. Federal Covered Status & Notice Filing establishes the authoritative rules tested on the NASAA Series 63. Determining whether an Investment Adviser registers with the SEC or state authorities, including AUM thresholds, mid-sized adviser rules, and federal covered adviser 'notice filing' requirements. VoraPrep verifies every threshold, worked table, and practice question below against the current NASAA Series 63 blueprint.
Core Statutory Concepts
| Category | Regulatory AUM (RAUM) | Registration Authority | Key Conditions / Rules |
|---|---|---|---|
| Small Adviser | Less than $25 million | State | Generally registers with the state(s) where it has a 'place of business' or meets specific client thresholds. |
| Mid-Sized Adviser | $25 million to $100 million | State (generally) | Registers with the state(s), UNLESS: (1) not subject to examination by its home state regulator, OR (2) would be required to register in 15 or more states. In these two exceptions, the adviser registers with the SEC. |
| Large Adviser | $100 million | SEC (may register) | An IA may register with the SEC once its RAUM reaches $100 million. |
| Large Adviser | $110 million | SEC (must register) | An IA must register with the SEC once its RAUM reaches $110 million. |
| SEC Withdrawal Buffer | Falls below $90 million | Withdraw from SEC (if applicable) | An SEC-registered IA need not withdraw its SEC registration until its RAUM falls below $90 million. This buffer prevents frequent switching due to market fluctuations. |
An investment adviser registered in State A provides advice to a few retail clients in State B. The adviser has no place of business in State B. Under the Uniform Securities Act, how many retail clients or fewer in State B over a 12-month period would allow the adviser to avoid registration in State B due to the 'de minimis' exemption?
Practitioner Application: Investment Adviser Registration: State vs. Federal Covered Status & Notice Filing
Your firm's investment advisory division is experiencing rapid growth, and its assets under management ('AUM') are approaching a significant threshold. The chief compliance officer asks you to review the current regulatory standing and determine if any changes are needed in its SEC or state registration status. Understanding the 'Dodd-Frank' AUM thresholds and 'notice filing' rules is paramount for the Series 63, as miscategorization can lead to severe regulatory penalties and business disruption.
- Investment Advisers ('IAs') must register with either the state securities authority or the Securities and Exchange Commission ('SEC'), but not usually both. The determination depends primarily on the IA's 'Regulatory Assets Under Management' ('RAUM') and where they conduct business. This framework was significantly influenced by the 'Dodd-Frank Wall Street Reform and Consumer Protection Act' ('Dodd-Frank').
- SEC vs. State Registration Thresholds (Dodd-Frank Rule 203A-1)
Common NASAA Series 63 Distractors on NASAA Uniform Securities Act · S63-1
- 1Conflating Registration and Notice Filing: A Federal Covered Investment Adviser 'notice files' with the states; it does NOT 'register' with them. State-registered IAs 'register' with the states.
- 2AUM Thresholds for SEC vs. State: Be precise with the AUM numbers: may register at $100M, must register at $110M, can withdraw below $90M. The 'mid-sized' adviser rules for $25M-$100M are also commonly tested.
- 3IA registration is primarily determined by 'Regulatory Assets Under Management' (RAUM).
- 4State Registration: Typically for 'small' (<$25M) and most 'mid-sized' ($25M-$100M) IAs.
- 5SEC Registration: Mandated for IAs with RAUM of $110 million or more (may register at $100M). An SEC-registered IA need not withdraw until RAUM falls below $90 million.
Frequently Asked Questions: NASAA Uniform Securities Act · S63-1
What is the core rule under NASAA Uniform Securities Act · S63-1 (Investment Adviser Registration: State vs. Federal Covered Status & Notice Filing)?
Under NASAA Uniform Securities Act · S63-1 (NASAA Uniform Securities Act), investment Adviser Registration: State vs. Federal Covered Status & Notice Filing establishes the authoritative rules tested on the NASAA Series 63. Determining whether an Investment Adviser registers with the SEC or state authorities, including AUM thresholds, mid-sized adviser rules, and federal covered adviser 'notice filing' requirements. VoraPrep verifies every threshold, worked table, and practice question below against the current NASAA Series 63 blueprint.
How is NASAA Uniform Securities Act · S63-1 tested on the NASAA Series 63?
Conflating Registration and Notice Filing: A Federal Covered Investment Adviser 'notice files' with the states; it does NOT 'register' with them. State-registered IAs 'register' with the states. AUM Thresholds for SEC vs. State: Be precise with the AUM numbers: may register at $100M, must register at $110M, can withdraw below $90M. The 'mid-sized' adviser rules for $25M-$100M are also commonly tested.
Where can I practice NASAA Series 63 questions on Investment Adviser Registration: State vs. Federal Covered Status & Notice Filing?
Test yourself instantly with the free playable NASAA Series 63 question on this page, or launch VoraPrep's full NASAA Series 63 adaptive question bank, interactive lessons, and 1:1 exam simulator at voraprep.com/series63.