A private fund adviser exemption was adopted by administrative order of the Colorado Securities Division, effective March 30, 2012.
Colorado is the ninth state to promulgate a private fund adviser exemption after California, Indiana, Maine, Massachusetts, Michigan, Rhode Island, Virginia and Wisconsin.
Colorado's private fund adviser exemption is like the other states' exemptions in that it: (1) makes the exemption unavailable for advisers subject to the "bad boy" disqualification provisions of Rule 262 of federal Regulation A; and (2) exempts from licensing investment adviser representatives of private fund adviser-exempt investment advisers.
Colorado's exemption differs from the other states' by exempting an investment adviser to a "family office" as defined in Rule 202(a)(11)(G)-1 of the Investment Advisers Act of 1940 and by exempting a "foreign private adviser" as defined in Section 202(a)(3) and Rule 202(a)(30)-1 of the Advisers Act.
Lastly, the exemption applies to investment advisers falling with the venture capital fund exemption of Section 203(l) of the Advisers Act who comply with the SEC Rule 204-4 reporting requirements. Note, however, that advisers relying on this state licensing exemption are not required to file the SEC Rule 204-4 reports with the Colorado Securities Commissioner. And note also that Colorado incorporates by reference into this state licensing exemption the "grandfathering" provision of Rule 203(l)-1(b) in the Advisers Act.