Securities Registration, Exemptions, and Federal Covered Securities

Before securities can be offered or sold in Texas, they must be registered or notice-filed with the State Securities Board, or exempt from registration, in accordance with the Texas Securities Act and Board Rules.

The term 'security' is defined broadly to include a wide array of investments such as stocks, bonds, notes, debentures, limited partnership interests, oil and gas interests, and investment contracts. Generally, an "investment contract" is created when a person invests something of value (usually, money) in a common enterprise with the expectation of a return (e.g., dividends or increased capital) to come through the managerial efforts of someone other than the investor.

Thus, the definition of security found in Section 4.A of the Texas Securities Act does not list every form of security that may exist. A security may exist even if there is no written document.

Statutory requirements for the registration of securities in Texas are found in Sections 7, 8 , 9, and 10 of the Texas Securities Act. Board Rules for the registration of securities are located in

Guidelines for the registration of various securities can be found in the North American Securities Administrators Association (NASAA) Statements of Policy (SOP) adopted by reference in §113.14.

Forms used to request registration of securities are available on this website. The applicable fees are also listed here. Statutory provisions regarding fees are set out in Sections 35, 35-1, and 35-2 of the Texas Securities Act.

Agency personnel review all applications for securities registration to ensure that investors have access to full and fair disclosure of all relevant information and that the offering terms are "fair, just and equitable" in accordance with criteria set out in the Act and in Board Rules.

Approval of a registration application does not constitute a recommendation of the securities being registered, nor does it predict investment success. The purpose of the review is to ensure that certain minimal financial and information requirements have been met so that an offering is fair, just, and equitable.

Exemptions from registration are found in Sections 5 and 6 of the Act and in Chapters 109, 111, and 139 of the Board Rules. Even when an exemption from registration is available, the seller of the securities has a duty to disclose all material information about the offering.