Part VII. State Securities Board

Chapter 101. General Administration

7 TAC §§101.1, 101.2, 101.5

The State Securities Board adopts amendments to §§101.1, 101.2, and 101.5, concerning general administration and copy charges. The rules are adopted without changes to the proposed text as published in the December 4, 1998, issue of the Texas Register (23 TexReg 12031).

The amendments update references and conform the text to existing statutes and other Board rules.

The rules conform to other Board rules and statutes.

No comments were received regarding adoption of the amendments.

The amendments are adopted under Texas Civil Statutes, Article 581-28-1. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 22, 1999.

TRD-9901110

Denise Voigt Crawford

Securities Commissioner

State Securities Board

Effective date: March 14, 1999

Proposal publication date: December 4, 1998

For further information, please call: (512) 305-8300

7 TAC §103.5

The State Securities Board adopts an amendment to §103.5, concerning rulemaking petitions. The rule is adopted without changes to the proposed text as published in the December 4, 1998, issue of the Texas Register (23 TexReg 12032).

The amendment makes the provision gender neutral.

The rule is updated to use current terminology.

No comments were received regarding adoption of the amendment.

The amendment is adopted under Texas Civil Statutes, Article 581-28-1 and Texas Government Code, §2001.021. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Section 2001.021 requires state agencies to adopt rules prescribing the form for a rulemaking petition and the procedure for its submission, consideration, and disposition.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 22, 1999.

TRD-9901109

Denise Voigt Crawford

Securities Commissioner

State Securities Board

Effective date: March 14, 1999

Proposal publication date: December 4, 1998

For further information, please call: (512) 305-8300

7 TAC §§104.2, 104.4, 104.5, 104.6

The State Securities Board adopts amendments to §§104.2, 104.4, 104.5, and 104.6, concerning the procedure for review of applications. The rules are adopted without changes to the proposed text as published in the December 4, 1998, issue of the Texas Register (23 TexReg 12032).

The amendments conform language to current terminology and reflect statutory language regarding time periods.

The rules conform to terminology utilized in other Board rules and statutes.

No comments were received regarding adoption of the amendments.

The amendments are adopted under Texas Civil Statutes, Article 581-28-1 and Texas Government Code, §2005.003 and §2005.006. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Section 2005.003 requires state agencies issuing permits to adopt procedural rules for processing permit applications and issuing permits and §2005.006 requires such agencies to establish by rule a complaint procedure regarding delays in processing permits.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 22, 1999.

TRD-9901107

Denise Voigt Crawford

Securities Commissioner

State Securities Board

Effective date: March 14, 1999

Proposal publication date: December 4, 1998

For further information, please call: (512) 305-8300

7 TAC §109.13

The State Securities Board adopts an amendment to §109.13, concerning uniform limited offering exemptions. The rule is adopted without changes to the proposed text as published in the December 4, 1998, issue of the Texas Register (23 TexReg 12033).

The amendment corrected a cross-reference to §114.4, pertaining to dealer and agent registration requirements applicable to federal covered securities.

The rule informs persons dealing with SEC Rule 506 federal covered securities that the dealer and agent registration requirements of the Texas Securities Act and Board rules are applicable.

No comments were received regarding adoption of the amendment.

The amendment is adopted under Texas Civil Statutes, Article 581-28-1 and 581-5.T. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Section 5.T provides that the Board may prescribe new exemptions by rule.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 22, 1999.

TRD-9901108

Denise Voigt Crawford

Securities Commissioner

State Securities Board

Effective date: March 14, 1999

Proposal publication date: December 4, 1998

For further information, please call: (512) 305-8300

7 TAC §115.1

The State Securities Board adopts an amendment to §115.1, concerning registration of branch offices. The rule is adopted without changes to the proposed text as published in the December 18, 1998, issue of the Texas Register (23 TexReg 12845).

The amendment clarifies that branch offices of a dealer or investment adviser are subject to examination by the Agency staff.

The rule apprises dealers and investment advisers that the agency may conduct an on-site examination of their branch offices.

One comment letter was received regarding adoption of the amendment. The commenter expressed concern that the amendment was beyond the statutory authority of the agency and inconsistent with state and federal law and suggested that the Board utilize the NASD definition of "office of supervisory jurisdiction" in place of the Board's long-standing branch office designation. The staff responded that the amendment imposes no additional operational reporting requirements or books or recordkeeping obligations on branch offices of registered dealers and investment advisers. The addition was to serve merely as a reminder to dealers and investment advisers that their branch offices are subject to the same examinations by agency staff as are their main offices. Research by agency counsel has indicated that both the provisions and the practices implementing them are within the authority of the Board and are not inconsistent with state or federal law. The Board disagreed with the commenter and made no changes to the rule at adoption.

The amendment is adopted under Texas Civil Statutes, Article 581-28-1. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 22, 1999.

TRD-9901105

Denise Voigt Crawford

Securities Commissioner

State Securities Board

Effective date: March 14, 1999

Proposal publication date: December 18, 1998

For further information, please call: (512) 305-8300