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Vedder Thinking | Articles New York Adopts Investment Adviser Representative Registration and Examination Requirements


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On February 1, 2021, new regulations issued by the New York State Department of Law took effect, requiring certain investment adviser representatives, principals and supervisors of investment advisers (collectively, IARs) to register with New York, and satisfy certain examination requirements (unless a waiver is available). Registration is required by August 31, 2021, although IARs who permissibly operated under the prior rules and submit the requisite materials by August 31, 2021 can continue to operate under such prior rules until December 2, 2021. Note that prior to the new regulations taking effect, New York had not historically required the registration of IARs.

Under the new regulations, IARs representing an SEC-registered investment adviser from a New York place of business and meeting the definition of IAR under the Investment Advisers Act of 1940, as amended (Advisers Act), are required to register in New York. As relevant, the Advisers Act defines an IAR as a supervised person of an investment adviser that has (i) more than five clients who are natural persons and (ii) more than 10 percent of its clients who are natural persons. For purposes of counting natural person clients, “qualified clients” (as defined under the Advisers Act) are excluded.

Subject to certain available waivers, the new regulations provide that IARs must receive a passing grade on the Series 65 examination or the Series 7 and Series 66 examinations within two years prior to the date of filing for registration. IARs apply for registration with New York by submitting a Form U4 on the Investment Adviser Registration Depository (IARD) system and paying a $200 filing fee.

In general, IARs must be in compliance with the new regulations by December 2, 2021. IARs who permissibly operated under the prior rules can continue to operate under such prior rules so long as a Form U4 is submitted by August 31, 2021.

The text of the new regulations is available here, in addition to related guidance. If you have questions or need any assistance with respect to the matters discussed above, please contact the Vedder Price attorney you work with regularly. 


Jeff VonDruska