§ 73-301 — Unlawful conduct for broker-dealers, agents, investment advisers, federal covered advisers and investment adviser representatives

Delaware § 73-301

• Jurisdiction: Delaware
• Title: 6
• Ch. 73: SECURITIES ACT
• Subch.: Provisions Relating to Broker-Dealers, Broker-Dealer Agents, Issuer Agents, Investment Advisers, Federal Covered Advisers, and Investment Adviser Representatives

Text

(a) It is unlawful for any person to transact business in this State as a broker-dealer or agent unless the person is registered under this chapter.

(b) It is unlawful for any broker-dealer or issuer to employ an agent unless the agent is registered.

(c) It is unlawful for any person to transact business in this State as an investment adviser or as an investment adviser representative unless:

(1) The person is registered under this chapter; or

(2) The person has no place of business in this State; and

a. The person’s only clients in this State are investment companies as defined in the Investment Company Act of 1940 [15 U.S.C. § 80a-1 et seq.], other investment advisers, federal covered advisers, broker-dealers, banks, trust companies, savings and loan associations, insurance companies, employee benefit plans with assets of not less than $1,000,000, and governmental agencies or instrumentalities, whether acting for themselves or as trustees with investment control, or other institutional investors as are designated by rule or order of the Director; or

b. During the preceding 12-month period has had not more than 5 clients, other than those specified in paragraph (c)(2)a. of this section, who are residents of this State.

(d) It is unlawful for any person required to be registered as an investment adviser under this chapter to employ an investment adviser representative unless the investment adviser representative is registered under this chapter.

(e) It is unlawful for any federal covered adviser to employ, supervise or associate with an investment adviser representative having a place of business located in this State unless such investment adviser representative is registered under this chapter or is exempt from registration.

(f) Except with respect to advisers whose only clients are those described in paragraph (c)(2) of this section, it is unlawful for any federal covered adviser to conduct advisory business in this State unless such person complies with the provisions of § 73-302(g) through (k) of this title. Notwithstanding the provisions of this subsection, until October 10, 1999, the Director may require the registration of any federal covered adviser for which fees required by § 73-302 have not been paid promptly following written notification from the Director regarding the nonpayment or underpayment of any such fee. A federal covered adviser shall be considered to have promptly paid such fees if they are remitted to the Director within 15 days following such person’s receipt of written notification from the Director.

Legislative History

6 Del. C. 1953, § 7313; 59 Del. Laws, c. 208, § 1 ; 63 Del. Laws, c. 161, § 1 ; 68 Del. Laws, c. 181, § 14 ; 70 Del. Laws, c. 186, § 1 ; 71 Del. Laws, c. 162, § 15 ; 78 Del. Laws, c. 175, §§ 41-48, 98, 118 ; 79 Del. Laws, c. 182, § 3