Wednesday, July 20, 2011

North Carolina Permits IAs Continued Reliance Temporarily on De Minimis Exemption from Registration

North Carolina-registered investment advisers and their representatives currently qualified for the State's de minimis exemption from investment adviser (and investment adviser representative) registration in accordance with Section 203(b)(3) of the Investment Advisers Act of 1940 may continue to temporarily rely on the exemption after the July 21st, 2011 effective date of SEC rules implementing Dodd Frank Act provisions, until the date the North Carolina Deputy Securities Administrator adopts final rules for private fund and exempt reporting advisers. Note, however, that this temporary relief applies only to the investment adviser/investment adviser representative registration provisions of the North Carolina Securities Act and rules and not also to the antifraud or securities registration provisions, for example. The temporary relief does not affect investment advisers or investment adviser representatives transacting business in North Carolina that are not subject to the Administrator's jurisdiction by virtue of the National Securities Markets Improvement Act (NSMIA).