What is a Broker-Dealer? - Davis Polk & Wardwell

§ 1A:7.6 BROKER-DEALER REGULATION
Company Act; or (iii) a trust or other donative instrument or the
settlors (or potential settlors) or beneficiaries of such a trust or other
instrument. 448 This exemption is not available to any charitable
organization, or any trustee, director, officer, employee, or volunteer
of such a charitable organization, unless each person who solicits
donations on behalf of such charitable organization from any donor to
a fund that is excluded from the definition of an investment company
under section 3(c)(10)(B) of the Investment Company Act, is either a
volunteer or is engaged in the overall fund-raising activities of a
charitable organization and receives no commission or other special
compensation based on the number or the value of donations collected
for the fund. 449
§ 1A:7.6 Associated Persons of Registered
Broker-Dealers
[A] Section 15(a)(1)
Absent an exemption, a person engaged in broker or dealer activities
has to register with the SEC in accordance with section 15(b). Section
15(a), however, does not require a natural person who is associated
with a Registered Broker-Dealer to register when he or she engages in
securities transactions as a broker-dealer. 450 A “person associated with
a broker or dealer” or “associated person of a broker or dealer” includes
any partner, officer, director, or branch manager of such broker or
dealer (or any person occupying a similar status or performing
similar functions), any person directly or indirectly controlling, controlled
by, or under common control with such broker or dealer, or any
employee of such broker or dealer, except that any person associated
with a broker-dealer whose functions are solely clerical or ministerial.
451 While exempted from registering with the SEC, with certain
exceptions associated persons must register with an SRO via the firm
with which they are associated and be subject to the supervision and
control of such firm. 452 Of course, the broker-dealer with whom the
natural person is associated must register with the SEC, absent an
exemption.
448. Exchange Act § 3(e)(1).
449. Exchange Act § 3(e)(2).
450. Exchange Act § 15(a)(1). A natural person who is not associated with a
registered broker-dealer will still have to register pursuant to Section 15(b).
451. Exchange Act § 3(a)(18).
452. See, e.g., NASD Rule 1032 (concerning registration of representatives) and
NASD Rule 3010 (concerning supervision).
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