§ 78A-36.1. Limited registration of Canadian dealers and salesmen. - North Carolina Statutes

§ 78A‑36.1.  Limitedregistration of Canadian dealers and salesmen.

(a)        A dealer that is aresident of Canada and that has no office or other physical presence in thisState may effect transactions in securities with or for, or induce or attemptto induce the purchase or sale of any security by:

(1)        A person from Canadawho is residing in this State temporarily and with whom the Canadian dealer hada bona fide dealer‑client relationship before the person entered theUnited States; or

(2)        A person from Canadawho is a resident of this State and whose transactions are in a self‑directedtax advantaged retirement plan in Canada of which the person is the holder orcontributor.

This subsection only appliesto dealers that are registered in accordance with this section.

(b)        A salesman who willbe representing a Canadian dealer registered under this section may effecttransactions in securities in this State as permitted for the dealer insubsection (a) of this section, only if the salesman is registered in accordancewith this section.

(c)        A Canadian dealermay register under this section provided that it meets all of the followingconditions:

(1)        The dealer files anapplication in the form required by the jurisdiction in which it has its headoffice.

(2)        The dealer files aconsent to service of process.

(3)        The dealer isregistered as a dealer in good standing in the jurisdiction from which it iseffecting transactions into this State and files evidence thereof.

(4)        The dealer is amember of a self‑regulatory organization, the Bureau des servicesfinanciers or a stock exchange in Canada.

(d)        A salesman who willbe representing a Canadian dealer registered under this section in effectingtransactions in securities in this State may register under this sectionprovided that the salesman meets all of the following conditions:

(1)        The salesman filesan application in the form required by the jurisdiction in which the dealer hasits head office.

(2)        The salesman files aconsent to service of process.

(3)        The salesman is registeredin good standing in the jurisdiction from which the salesman is effectingtransactions into this State and files evidence thereof.

(e)        If no denial orderis in effect and no proceeding is pending under G.S. 78A‑39, registrationbecomes effective on the thirtieth day after an application is filed, unlessthe registration is made effective earlier.

(f)         A Canadian dealerregistered under this section shall meet all of the following conditions:

(1)        The dealer maintainsits provincial or territorial registration and its membership in a self‑regulatoryorganization, the Bureau des services financiers or a stock exchange in goodstanding.

(2)        The dealer providesthe Administrator, upon request, with its books and records relating to itsbusiness in this State as a dealer.

(3)        The dealer informsthe Administrator forthwith of any criminal action taken against it or of anyfinding or sanction imposed on the dealer as a result of any self‑regulatoryor regulatory action involving fraud, theft, deceit, misrepresentation, orsimilar conduct.

(4)        The dealer disclosesto its clients in this State that the dealer and its agents are not subject tothe full regulatory requirements under this Article.

(g)        A salesman of aCanadian dealer registered under this section shall meet all of the followingconditions:

(1)        The salesmanmaintains the salesman's provincial or territorial registration in goodstanding.

(2)        The salesman informsthe Administrator forthwith of any criminal action taken against the salesmanor of any finding or sanction imposed on the salesman as a result of any self‑regulatoryor regulatory action involving fraud, theft, deceit, misrepresentation, orsimilar conduct.

(h)        Renewalapplications for Canadian dealers and salesmen under this section shall befiled before December 31 of each year and may be made by filing the most recentrenewal application, if any, filed in the jurisdiction in which the dealer hasits head office, or if no such renewal application is required, the most recentapplication filed pursuant to subdivision (c)(1) of this section or subdivision(d)(1) of this section, as applicable.

(i)         Every applicantfor registration or renewal of registration under this section shall pay thefee for dealers and salesmen as required in this Chapter.

(j)         Every Canadiandealer or salesman registered under this section may effect transactions inthis State only:

(1)        As permitted insubsection (a) or (b) of this section, and

(2)        With or through:

a.         The issuers of thesecurities involved in the transactions;

b.         Other dealers; and

c.         Banks, savingsinstitutions, trust companies, insurance companies, investment companies, asdefined in the Investment Company Act of 1940, pension or profit‑sharingtrusts, or other financial institutions or institutional buyers, whether actingfor themselves or as trustees.

(k)        Article 2 of thisChapter applies to Canadian dealers and salesmen registered under this section.

(l)         Except asotherwise provided in this section, Canadian dealers or salesmen registeredunder this section and acting in accordance with the limitations set out insubsection (j) of this section are exempt from all of the requirements of thisChapter. A registration under this section may be denied, suspended, or revokedpursuant to G.S. 78A‑39 only for a breach of Article 2 of this Chapter orthis section. (2001‑225,s. 1.)