| Notice Filed with SOS |
12/19/2022 |
| Rule |
ProposedRuleAttach2022-00806.docx
|
| Statutory Authority |
11-51-704, C.R.S. |
| Description of Subjects/Issues |
Rules under the Colorado Securities Act are being amended to:
Incorporate U.S. Securities & Exchange Commission Regulation Best Interest and include a violation of the rule as unfair and dishonest dealings.
Require broker-dealers to maintain written policies and procedures to ensure the "physical security of records" in addition to current requirements for policies and procedures related to cybersecurity.
Clarify the requirements for the filing, through IARD, of an Annual Updating Amendment of Form ADV.
Comply with the "lawful presence" provisions of Senate Bill 21-077.
Add a continuing education requirement for all licensed investment adviser representatives. This rule adopts a NASAA model rule.
Require investment advisers to maintain additional books and records.
Provide clarity regarding mandatory disclosures and the delivery to clients of an updated Part 2 of an advisers Form ADV.
Clarify that an investment adviser must include specific information in every advisory contract. This rule adopts a NASSA model rule.
Correct an internal citation and add that filing requirements for a financial statement shall be filed at the end of the adviser's "fiscal year" vs. "year".
Require investment advisers to establish, maintain and enforce specific written policies and procedures. This rule adopts a NASSA model rule.
Provide additional clarification, correct language, remove unnecessary terms, and other similar purposes. |
| Purpose/Objective of Rule |
Rules under the Colorado Securities Act are being amended to: Incorporate U.S. Securities & Exchange Commission Regulation Best Interest and include a violation of the rule as unfair and dishonest dealings. Require broker-dealers to maintain written policies and procedures to ensure the "physical security of records" in addition to current requirements for policies and procedures related to cybersecurity. Clarify the requirements for the filing of an Annual Updating Amendment of Form ADV. Comply with the "lawful presence" provisions of Senate Bill 21-077. Add a continuing education requirement for all licensed investment adviser representatives. This rule adopts a North American Securities Administrators Association "NASAA model rule. Require investment advisers to maintain additional books and records. Provide clarity regarding mandatory disclosures and the delivery to clients of an updated Part 2 of an advisers Form ADV. Clarify that an investment adviser must include specific information in every advisory contract. This rule adopts a NASSA model rule. Correct an internal citation and add that filing requirements for a financial statement shall be filed at the end of the adviser's "fiscal year" vs. "year". Require investment advisers to establish, maintain and enforce specific written policies and procedures. This rule adopts a NASSA model rule. Provide additional clarification, correct language, remove unnecessary terms, and other similar purposes. See attachment for further detail |
| Basis And Purpose |
BasisAndPurposeAttachment2022-00806.doc
|
| Regulatory analysis |
RegulatoryAnalysisAttachment2022-00806.doc
|
| Comments |
Website for Current Agency Rules: https://securities.colorado.gov/rule-making-notices-and-opinions
An initial proposed rule was submitted to the Colorado Office of Policy, Research and Regulatory Reform on October 21, 2022 (Rule ID 9532). A cost benefit analysis request was received and an analysis performed (see attached) and discussed at an initial hearing on December 1, 2022. The notice of rulemaking was not filed with the SOS, so the rules were announced a second time through OPRRR. The initial cost benefit analysis and hearing on 12/1 have been incorporated into this filing. |
| Submitted in response to issues raised by COLS/OLLS? |
No
|
| Is this rule adopted in response to recent legislation? |
Yes
|
| Recent legislation bill number |
Senate Bill 21-077.
|
| Hearing Date |
01/30/2023 |
| Hearing Time |
10:00 AM |
| Hearing Location |
1560 Broadway, DORA Conference Center, Denver, Colorado |
| Contact Name |
Jeffrey S. Eaby |
| Contact Title |
Chief Examiner |
| Contact Telephone |
303-894-2320 |
| Contact email |
jeffrey.eaby@state.co.us |