2025
EFFECTIVE MARCH 13, 2025, THE TEXAS STATE SECURITIES BOARD IS PLEASED TO ANNOUNCE THE ADOPTION OF RULES TO RECOGNIZE FINRA MQP AND NASAA EVEP, AS WELL AS OTHER RULES ADOPTING THE SEC REGULATION BEST INTEREST AND THE SEC MARKETING RULE BY REFERENCE, AND RULES RECOGNIZING FINRA RULES ON RESIDENTIAL SUPERVISORY LOCATIONS (RSLs) AND THE FINRA REMOTE INSPECTIONS PILOT PROGRAM (RIPP). THE RULES WERE UNANIMOUSLY ADOPTED BY THE BOARD AT ITS FEBRUARY 20 MEETING AND WILL BE REPORTED IN A MARCH 7 PUBLICATION OF THE TEXAS REGISTER.
The Texas State Securities Board adopted changes to Chapters 115 and 116 of its rules concerning broker-dealers, investment advisers, agents, and investment adviser representatives, at its February 20, 2025, board meeting.
This rulemaking, which was published in the November 8, 2024, issue, of the Texas Register for publication and comment, is also available on the Agency’s website. The Board adopted the proposals with no changes, except for minor nonsubstantive formatting changes to §115.1 and §116.3. The Board received several public comments in response to and in support of the rulemaking. These comment letters are also posted on the Agency’s website.
These changes, which were submitted to the Texas Register on February 21, will go into effect on Thursday, March 13, 2025. The adoption notices will appear in the Register’s March 7, 2025, issue. The Agency will post the Register notices and adopted rules on the Agency’s website in the next couple weeks as they are published in the Register and in the Texas Administrative Code. Along with a number of technical changes that have been made as part of its periodic review of its rules, the Board also adopted the following changes to harmonize its rules with federal securities laws, FINRA rules, and other state securities regulators:
EVEP and MQP. On March 13, 2025, the Agency will begin recognizing the NASAA EVEP and the FINRA MQP related to examination requirements, and RSLs related to dealers. FINRA and NASAA have been advised of these changes and CRD will be updated accordingly to reflect these changes.
FINRA RIPP. Under the adopted amendment to §115.10, registered Texas dealers participating in the RIPP would be in compliance with the Board’s rules on supervision if they conduct their internal inspections programs in compliance with FINRA rules.
SEC Regulation Best Interest. In addition to the above changes the Board also adopted new rule §115.24 adopting by reference the SEC’s Reg BI rule governing dealer conduct, as well as other applicable fair practice or ethical rules promulgated by the SEC, FINRA, the CFTC, or any self-regulatory organization approved by the SEC or the CFTC, along with a related amendment to the dealer recordkeeping rule to verify compliance with such conduct rules.
SEC Marketing Rule. Lastly, the Board has adopted by reference the SEC’s Marketing Rule in its amendment to §116.15 as suggested by industry, allowing Texas registered investment advisers similar latitude in marketing activities as SEC registered investment advisers. A related change amends investment adviser recordkeeping requirements to verify compliance with the rule.
If you have questions about the recent rulemaking, please contact Cristi Ochoa, Deputy Commissioner, by email at cochoa@ssb.texas.gov.