(1) An
individual associated person of a broker-dealer shall be exempt from the
definition of "agent" as defined under T.C.A. §
48-1-102(3) if
such individual associated person effects any of the two (2) types of
transactions in securities described in paragraph (2) of this Rule for a
customer in this
state and satisfies the following conditions:
(a) Such individual associated person is not
ineligible to register in this state for any reason other than such a
transaction in securities;
(b) Such
individual associated person is registered with a securities association
registered under the 1934 Act and is also registered in at least one (1) state;
and
(c) The broker-dealer with
which such individual person is associated is appropriately registered in this
state.
(2) For purposes
of this Rule, the following are the two (2) types of transactions referred to
in paragraph (1):
(a) A transaction that is
effected on behalf of a
customer who:
1.
Maintained an account with the broker-dealer employing the associated person
for thirty (30) days prior to the date of the transaction; and
2. Was assigned to such individual associated
person for fourteen (14) days prior to the day of the transaction and such
individual associated person is registered with the state in which the customer
was resident or was present for at least thirty (30) consecutive days during
the one (1) year period prior to the day of the securities transaction;
or
(b) A transaction
that is:
1. Effected on behalf of a customer
who maintains an account with the broker-dealer for thirty (30) days prior to
the date of the securities transactions; and
2. Effected during the period, beginning on
the date on which such individual associated person of a broker-dealer files an
application for agent registration in this
state and ending on the earlier of:
(i) Sixty (60) days after the date on which
the application is filed; or
(ii)
The date on which this
state notifies the associated person that it has denied
the application for registration or has stayed the pendency of the application
for cause.
For purposes of part (2)(a)2. of this Rule, each of up to
three (3) individuals, who are associated persons of a broker-dealer and who
are designated by such broker-dealer to effect securities transactions for a
customer in this state during the absence or unavailability of the principal
associated person for a customer, may be treated as an associated person to
which such customer is assigned.
(3) An exemption from the
definition of "agent" claimed on the basis of the transaction set forth in
subparagraph (2)(a) of this Rule shall not be effective if the
customer is
present in this
state for thirty (30) or more consecutive days or has
permanently changed his or her residence to this
state and the associated
person of the broker-dealer fails to file an application for agent registration
in this
state pursuant to T.C.A. §§
48-1-109 and
48-1-110 not later than ten (10)
business days after the later of:
(a) The
date of the transaction;
(b) The
date of discovery of the customer's presence in this state for thirty (30) or
more consecutive days; or
(c) The
change in the customer's residence.
(4) The exemptions set forth herein shall not
exempt any person from the operation of the antifraud provision of the Act set
forth at T.C.A. §
48-1-121.
Notes
Tenn. Comp. R.
& Regs.
0780-04-03-.11
Original
rule filed November 6, 1997; effective January 20, 1998. Amendment filed May
15, 2002; effective July 29, 2002. Amendment filed April 5, 2004; effective
June 19, 2004. Repeal and new rule filed March 16, 2015; effective
6/14/2015.
Authority: T.C.A. §§
48-1-102,
48-1-109,
48-1-110,
48-1-115,
48-1-116,
48-1-121, and §15 of the
Securities and Exchange Act of 1934, as amended by §103(a) of the National
Securities Markets Improvement Act of 1996.
