Ohio Code 1707.161 – Investment adviser representative’s license required – exceptions – application for and issuance of investment adviser representative’s license
(A) No person shall act as an investment adviser representative, unless one of the following applies:
Terms Used In Ohio Code 1707.161
- Another: when used to designate the owner of property which is the subject of an offense, includes not only natural persons but also every other owner of property. See Ohio Code 1.02
- Dealer: except as otherwise provided in this chapter, means every person, other than a salesperson, who engages or professes to engage, in this state, for either all or part of the person's time, directly or indirectly, either in the business of the sale of securities for the person's own account, or in the business of the purchase or sale of securities for the account of others in the reasonable expectation of receiving a commission, fee, or other remuneration as a result of engaging in the purchase and sale of securities. See Ohio Code 1707.01
- Investment adviser: means any person who, for compensation, engages in the business of advising others, either directly or through publications or writings, as to the value of securities or as to the advisability of investing in, purchasing, or selling securities, or who, for compensation and as a part of regular business, issues or promulgates analyses or reports concerning securities. See Ohio Code 1707.01
- Investment adviser representative: means a supervised person of an investment adviser, provided that the supervised person has more than five clients who are natural persons other than excepted persons defined in division (EE) of this section, and that more than ten per cent of the supervised person's clients are natural persons other than excepted persons defined in division (EE) of this section. See Ohio Code 1707.01
- Person: except as otherwise provided in this chapter, means a natural person, firm, partnership, limited partnership, partnership association, syndicate, joint-stock company, unincorporated association, trust or trustee except where the trust was created or the trustee designated by law or judicial authority or by a will, and a corporation or limited liability company organized under the laws of any state, any foreign government, or any political subdivision of a state or foreign government. See Ohio Code 1707.01
- Rule: includes regulation. See Ohio Code 1.59
- salesperson: means every natural person, other than a dealer, who is employed, authorized, or appointed by a dealer to sell securities within this state. See Ohio Code 1707.01
- State: means any state of the United States, any territory or possession of the United States, the District of Columbia, and any province of Canada. See Ohio Code 1707.01
(1) The person is licensed as an investment adviser representative by the division of securities.
(2) The person is a natural person who is licensed as an investment adviser by the division, and does not act as an investment adviser representative for another investment adviser; however, a natural person who is licensed as an investment adviser by the division may act as an investment adviser representative for another investment adviser if the natural person also is licensed by the division, or is properly excepted from licensure, as an investment adviser representative of the other investment adviser.
(3) The person is employed by or associated with an investment adviser registered under section 203 of the “Investment Advisers Act of 1940,” 15 U.S.C. §§ 80b-3, and does not have a place of business in this state.
(4) The person is employed by or associated with an investment adviser that is excepted from licensure pursuant to division (A)(3), (4), (5), or (6) of section 1707.141 of the Revised Code or excepted from notice filing pursuant to division (B)(3) of section 1707.141 of the Revised Code.
(B)(1) No investment adviser representative required to be licensed under this section shall act as an investment adviser representative for more than two investment advisers. An investment adviser representative that acts as an investment adviser representative for two investment advisers shall do so only after the occurrence of both of the following:
(a) Being properly licensed, or properly excepted from licensure under this section, as an investment adviser representative for both investment advisers;
(b) Complying with the requirements set forth in rules adopted by the division regarding consent of both investment advisers and notice.
(2) Nothing in this section shall be construed to prohibit a natural person from being licensed by the division as both an investment adviser and an investment adviser representative.
(3) Nothing in this section shall be construed to prohibit a natural person from being licensed by the division as both a salesperson and an investment adviser representative.
(4) Nothing in this section shall be construed to prohibit a natural person from being licensed by the division as both a dealer and an investment adviser representative.
(C) An investment adviser representative’s license issued under this section shall not be effective during any period when the investment adviser representative is not employed by or associated with an investment adviser that is licensed by the division or that is in compliance with the notice filing requirements of division (B) of section 1707.141 of the Revised Code. Notice of the commencement and termination of the employment or association of an investment adviser representative licensed under this section shall be given to the division within thirty days after the commencement or termination by either of the following:
(1) The investment adviser, in the case of an investment adviser representative licensed under this section and employed by or associated with, or formerly employed by or associated with, an investment adviser licensed under section 1707.141 of the Revised Code;
(2) The investment adviser representative, in the case of an investment adviser representative licensed under this section and employed by or associated with, or formerly employed by or associated with, an investment adviser that is subject to the notice filings requirements of division (B) of section 1707.141 of the Revised Code.
(D)(1) Application for an investment adviser representative license shall be made in accordance with this section and by filing with the division the information, materials, and forms specified in rules adopted by the division.
(2) The division shall by rule require an applicant to pass an examination designated by the division or achieve a specified professional designation.
(3) Prior to issuing the investment adviser representative license, the division may require the applicant to reimburse the division for the actual expenses incurred in investigating the applicant. An itemized statement of any such expenses that the applicant is required to pay shall be furnished to the applicant by the division.
(E)(1) Except as provided in division (E)(2) of this section, if the division finds that the applicant is of good business repute, appears to be qualified to act as an investment adviser representative, and has complied with sections 1707.01 to 1707.50 of the Revised Code and the rules adopted under those sections by the division, the division, upon payment of the fees prescribed by division (B) of section 1707.17 of the Revised Code, shall issue to the applicant a license authorizing the applicant to act as an investment adviser representative for the investment adviser, or investment advisers that are under common ownership or control, named in the application.
(2) The division shall issue a license to act as an investment adviser representative in accordance with Chapter 4796 of the Revised Code to an applicant if either of the following applies:
(a) The applicant holds a license in another state.
(b) The applicant has satisfactory work experience, a government certification, or a private certification as described in that chapter as an investment adviser representative in a state that does not issue that license.
Last updated December 29, 2023 at 7:11 AM