New Hampshire Revised Statutes 421-B:4-404 – Investment Adviser Representative Registration Requirement and Exemptions
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(a) Registration requirement. It is unlawful for an individual to transact business in this state as an investment adviser representative unless the individual is registered under this chapter as an investment adviser representative or is exempt from registration as an investment adviser under subsection (b).
(b) Exemptions from registration. The following individuals are exempt from the registration requirement of subsection (a):
(1) an individual who is employed by or associated with an investment adviser that is exempt from registration under N.H. Rev. Stat. § 421-B:4-403(b) or a federal covered investment adviser that is excluded from the notice filing requirements of N.H. Rev. Stat. § 421-B:4-405; and
(2) any other individual exempted by order issued under this chapter.
(c) Registration effective only while employed or associated. The registration of an investment adviser representative is not effective while the investment adviser representative is not employed by or associated with an investment adviser registered under this chapter or a federal covered investment adviser that has made or is required to make a notice filing under N.H. Rev. Stat. § 421-B:4-405.
(d) Limit on affiliations. An individual may transact business as an investment adviser representative for more than one investment adviser or federal covered investment adviser unless an order issued under this chapter prohibits or limits an individual from acting as an investment adviser representative for more than one investment adviser or federal covered investment adviser.
(e) Limits on employment or association. It is unlawful for an individual acting as an investment adviser representative, directly or indirectly, to conduct business in this state on behalf of an investment adviser or a federal covered investment adviser if the registration of the individual as an investment adviser representative is suspended or revoked or the individual is barred from employment or association with an investment adviser or a federal covered investment adviser by an order under this chapter, the Securities and Exchange Commission, or a self-regulatory organization. Upon request from a federal covered investment adviser and for good cause, the secretary of state, by order issued, may waive, in whole or in part, the application of the requirements of subsection (e) to the federal covered investment adviser.
(f) Client solicitors. A person who solicits referrals of investment advisory clients to an investment adviser may apply for a license as a solicitor by filing with the secretary of state an application, including a request for waiver of examination requirements, a copy of the solicitation agreement with such investment adviser and a copy of the disclosure document of the investment adviser disclosing the arrangements between such investment adviser and such solicitor and an undertaking that, prior to entering into any investment advisory contract with a client, the investment adviser will obtain from such client a signed and dated acknowledgement that the investment advisory contract is being entered into pursuant to a solicitation arrangement with the solicitor as described in the disclosure document.
(b) Exemptions from registration. The following individuals are exempt from the registration requirement of subsection (a):
Terms Used In New Hampshire Revised Statutes 421-B:4-404
- Contract: A legal written agreement that becomes binding when signed.
- Federal covered investment adviser: means a person registered with the United States Securities and Exchange Commission under the Investment Advisers Act of 1940. See New Hampshire Revised Statutes 421-B:1-102
- Filing: means the receipt under this chapter of a record by the secretary of state. See New Hampshire Revised Statutes 421-B:1-102
- following: when used by way of reference to any section of these laws, shall mean the section next preceding or following that in which such reference is made, unless some other is expressly designated. See New Hampshire Revised Statutes 21:13
- including: shall be construed as introducing a non-exhaustive list. See New Hampshire Revised Statutes 421-B:1-102
- Investment adviser: means a person that, for compensation, engages in the business of advising others, either directly or through publications or writings, as to the value of securities or the advisability of investing in, purchasing, or selling securities or that, for compensation and as a part of a regular business, issues or promulgates analyses or reports concerning securities. See New Hampshire Revised Statutes 421-B:1-102
- Investment adviser representative: means an individual employed by or associated with an investment adviser or federal covered investment adviser and who makes any recommendations or otherwise gives investment advice regarding securities, manages accounts or portfolios of clients, determines which recommendation or advice regarding securities should be given, provides investment advice or holds herself or himself out as providing investment advice, receives compensation to solicit, offer, or negotiate for the sale of or for selling investment advice, or supervises employees who perform any of the foregoing. See New Hampshire Revised Statutes 421-B:1-102
- Investment advisory contract: means any contract or agreement whereby a person agrees to act as an investment adviser or to manage any investment or trading account for a person other than an investment adviser as defined in subsection (26). See New Hampshire Revised Statutes 421-B:1-102
- Order: means an order issued pursuant to this chapter. See New Hampshire Revised Statutes 421-B:1-102
- Person: means an individual; corporation; business trust; estate; trust; partnership; limited liability company; association; joint venture; government; governmental subdivision, agency, or instrumentality; public corporation; or any other legal or commercial entity. See New Hampshire Revised Statutes 421-B:1-102
- Secretary of state: means the New Hampshire secretary of state or his or her designee. See New Hampshire Revised Statutes 421-B:1-102
- Self-regulatory organization: means a national securities exchange registered under the Securities Exchange Act of 1934, a national securities association of broker-dealers registered under the Securities Exchange Act of 1934, a clearing agency registered under the Securities Exchange Act of 1934, or the Municipal Securities Rulemaking Board established under the Securities Exchange Act of 1934. See New Hampshire Revised Statutes 421-B:1-102
- Solicitor: means an investment adviser, or investment adviser representative that:
(A) Is licensed under this chapter;
(B) Conducts an investment advisory business solely for the purpose of soliciting, directly or indirectly, any client for, or referring any client to, an investment adviser licensed under this chapter;
(C) Receives a cash fee for such solicitation or referral; and
(D) Operates pursuant to a written agreement with the investment adviser that:
(i) Describes the solicitation activities to be engaged in on behalf of the investment adviser and the compensation to be received therefor;
(ii) Contains an undertaking to perform the duties under the agreement in a manner consistent with the instructions of the investment adviser and the provisions of this chapter; and
(iii) Requires that at the time of any solicitation activities for which compensation is paid or to be paid by the investment adviser, that the client be provided with a current copy of the investment adviser's written disclosure statement that describes the solicitation arrangement. See New Hampshire Revised Statutes 421-B:1-102 - State: means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. See New Hampshire Revised Statutes 421-B:1-102
(1) an individual who is employed by or associated with an investment adviser that is exempt from registration under N.H. Rev. Stat. § 421-B:4-403(b) or a federal covered investment adviser that is excluded from the notice filing requirements of N.H. Rev. Stat. § 421-B:4-405; and
(2) any other individual exempted by order issued under this chapter.
(c) Registration effective only while employed or associated. The registration of an investment adviser representative is not effective while the investment adviser representative is not employed by or associated with an investment adviser registered under this chapter or a federal covered investment adviser that has made or is required to make a notice filing under N.H. Rev. Stat. § 421-B:4-405.
(d) Limit on affiliations. An individual may transact business as an investment adviser representative for more than one investment adviser or federal covered investment adviser unless an order issued under this chapter prohibits or limits an individual from acting as an investment adviser representative for more than one investment adviser or federal covered investment adviser.
(e) Limits on employment or association. It is unlawful for an individual acting as an investment adviser representative, directly or indirectly, to conduct business in this state on behalf of an investment adviser or a federal covered investment adviser if the registration of the individual as an investment adviser representative is suspended or revoked or the individual is barred from employment or association with an investment adviser or a federal covered investment adviser by an order under this chapter, the Securities and Exchange Commission, or a self-regulatory organization. Upon request from a federal covered investment adviser and for good cause, the secretary of state, by order issued, may waive, in whole or in part, the application of the requirements of subsection (e) to the federal covered investment adviser.
(f) Client solicitors. A person who solicits referrals of investment advisory clients to an investment adviser may apply for a license as a solicitor by filing with the secretary of state an application, including a request for waiver of examination requirements, a copy of the solicitation agreement with such investment adviser and a copy of the disclosure document of the investment adviser disclosing the arrangements between such investment adviser and such solicitor and an undertaking that, prior to entering into any investment advisory contract with a client, the investment adviser will obtain from such client a signed and dated acknowledgement that the investment advisory contract is being entered into pursuant to a solicitation arrangement with the solicitor as described in the disclosure document.