TITLE 7. BANKING AND SECURITIES

PART 7. STATE SECURITIES BOARD

CHAPTER 104. PROCEDURE FOR REVIEW OF APPLICATIONS
7 TAC §104.4, §104.5

The Texas State Securities Board adopts amendments to §104.4, concerning registration of securities--review of applications, and §104.5, concerning registration of dealers and investment advisers--review of applications, without changes to the proposed text as published in the June 5, 2015, issue of the Texas Register (40 TexReg 3291).

The rules allow modern communication alternatives, such as email and facsimile, to be used by staff for transmitting deficiency and comment letters required to be provided to an applicant in writing.

Use of electronic means for transmitting written deficiency and comment letters will reduce the time needed to process registration applications.

A comment letter was received from the Financial Services Institute in support of the proposals. The letter noted that the changes would increase communications speeds and simplify the document delivery process. The Board agreed and adopted the rules as published.

The amendments are adopted under Texas Civil Statutes, Article 581-28-1 and Texas Government Code §2005.003. 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.

The adopted amendments affect Texas Civil Statutes, Articles 581-7, 581-10, 581-13, and 581-15, and Texas Government Code §2005.003.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on September 16, 2015.

TRD-201503801

John Morgan

Securities Commissioner

State Securities Board

Effective date: October 6, 2015

Proposal publication date: June 5, 2015

For further information, please call: (512) 305-8301

CHAPTER 115.SECURITIES DEALERS AND AGENTS

7 TAC §115.2

The Texas State Securities Board adopts an amendment to §115.2, concerning application requirements, without changes to the proposed text as published in the June 5, 2015, issue of the Texas Register (40 TexReg 3292).

The rule sets out the requirements for a balance sheet that accompanies an application for dealer registration and includes a reference to Form 133.18, which would be used when the applicant's balance sheet is certified by the principal financial officer of the applicant.

The registration process would be simplified by providing a specific certification form for an applicant to use when certifying its balance sheet.

A comment letter was received from the Financial Services Institute in support of the proposal. The letter noted that the changes would enhance disclosure by the securities industry, make it less likely that firms engaged in fraudulent activity would be able to access the Texas securities market, and may, in turn, increase investor confidence. The Board agreed and adopted the rule as published.

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.

The adopted amendments affect Texas Civil Statutes, Articles 581-12, 581-13, and 581-18.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on September 16, 2015.

TRD-201503803

John Morgan

Securities Commissioner

State Securities Board

Effective date: October 6, 2015

Proposal publication date: June 5, 2015

For further information, please call: (512) 305-8301

CHAPTER 116. INVESTMENT ADVISERS AND INVESTMENT ADVISER REPRESENTATIVES

7 TAC §116.2

The Texas State Securities Board adopts an amendment to §116.2, concerning application requirements, without changes to the proposed text as published in the June 5, 2015, issue of the Texas Register (40 TexReg 3293).

The rule sets out the requirements for a balance sheet that accompanies an application for investment adviser registration and includes a reference to Form 133.18, which would be used when the applicant's balance sheet is certified by the principal financial officer of the applicant.

The registration process would be simplified by providing a specific certification form for an applicant to use when certifying its balance sheet.

A comment letter was received from the Financial Services Institute in support of the proposal. The letter noted that the changes would enhance disclosure by the securities industry, make it less likely that firms engaged in fraudulent activity would be able to access the Texas securities market, and may, in turn, increase investor confidence. The Board agreed and adopted the rule as published.

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.

The adopted amendments affect Texas Civil Statutes, Articles 581-12, 581-13, and 581-18.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on September 16, 2015.

TRD-201503804

John Morgan

Securities Commissioner

State Securities Board

Effective date: October 6, 2015

Proposal publication date: June 5, 2015

For further information, please call: (512) 305-8301

CHAPTER 133. FORMS

7 TAC §133.18

The Texas State Securities Board adopts new §133.18, which adopts by reference a form concerning certification of balance sheet by principal financial officer, without changes to the proposed text as published in the June 5, 2015, issue of the Texas Register (40 TexReg 3294).

The form would be used for certification of an applicant's balance sheet, which accompanies an application for registration as a dealer or investment adviser.

Use of the form would simplify the registration process.

A comment letter was received from the Financial Services Institute in support of the proposal. The letter noted that the new form would simplify compliance by providing a standardized form. The Board agreed and adopted the rule as published.

The new rule 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.

The new rule affects Texas Civil Statutes, Articles 581-12, 581-13, and 581-18.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on September 16, 2015.

TRD-201503805

John Morgan

Securities Commissioner

State Securities Board

Effective date: October 6, 2015

Proposal publication date: June 5, 2015

For further information, please call: (512) 305-8301