Section 606.041. Delegation and substitution

(a) The Commission delegates to the Director and Assistant Directors of the Division of Enforcement, Litigation and Compliance:

(1) The powers in section 510(a)(i)—(iii), (b), except for hearings, and (c) of the act (70 P. S. § 1-510(a)(i)—(iii), (b) and (c)) and the authority to close, vacate, modify or amend an action authorized under this paragraph.

(2) The power to commence an administrative proceeding against a person under 1 Pa. Code § § 35.14 and 35.37 (relating to orders to show cause; and answers to orders to show cause) and the authority to vacate, modify or amend an order to show cause issued under this paragraph. A hearing will not be held, nor will a remedial or disciplinary order issue following upon the institution of the proceedings, except upon the express order of the Commission.

(3) The power exercisable by the Commission under section 606(c) of the act (70 P. S. § 1-606(c)) to issue a summary order to cease advertising and the authority to vacate, modify or amend a summary order to cease advertising issued under this paragraph.

(4) The power exercisable under section 606(c.1) of the act to issue a cease and desist order against a registered broker-dealer or investment adviser when the registrant is engaging in an act or practice which constitutes a violation of § 304.011(e) or § 304.012(e) (relating to broker-dealer required records; and investment adviser required records) by refusing to make available for inspection by Commission staff acting under the examination authority in section 304(d) of the act (70 P. S. § 1-304(d)), the records specified in § § 304.011 or 304.012.

(5) The power to institute a proceeding under sections 512—514 of the act (70 P. S. § § 1-512—1-514) to do one of the following:

(i) Impose a statutory bar under section 512 of the act (70 P. S. § 1-514).

(ii) Mandate a rescission offer under section 513 of the act (70 P. S. § 1-513).

(iii) Compel the return of sales commissions under section 514 of the act (70 P. S. § 1-514).

(b) The Commission delegates to the Director of the Division of Licensing:

(1) The power exercisable under section 303(a)(ii) of the act (70 P. S. § 1-303(a)(ii)) to order applications for registration filed under section 303 of the act to become effective on any day earlier than the 45th day after the filing of the application or material amendment thereto as the Director may determine. For purposes of this paragraph, the term ‘‘application’’ means an application for either an initial or renewal license.

(2) The power exercisable under section 609(a) of the act (70 P. S. § 1-609(a)) to waive the provisions of § § 303.031 and 303.032 (relating to examination requirement for agents; and examination requirements for investment advisers and investment adviser representatives).

(3) The power exercisable under section 305(f) of the act (70 P. S. § 1-305(f)) to order applications to withdraw from the status of a registered broker-dealer, agent, investment adviser or investment adviser representative to become effective on any day earlier than the 30th day after the filing of the application.

(4) The power exercisable under 1 Pa. Code § 33.42(a) (relating to withdrawal or termination) for proceedings under section 303 of the act.

(5) The power exercisable under section 609(f) of the act (70 P. S. § 1-609(f)) with respect to applications for registration of a broker-dealer, agent, investment adviser or investment adviser representative. For purposes of this paragraph, the term ‘‘application’’ means an application for either an initial or renewal license.

(6) The power exercisable under section 303(a)(i) of the act to grant a waiver of any requirement imposed under section 303(a)(i) of the act or section 304 of the act (70 P. S. § 1-304) or any regulation promulgated thereunder and impose conditions on, or limit the scope of, an initial or renewal license of a broker-dealer, agent, investment adviser or investment adviser representative.

(7) The power exercisable under section 603(c) of the act (70 P. S. § 1-603(c)) and § 603.031(c) (relating to public inspection of records) to treat documents filed with the Division of Licensing as temporarily confidential until the close of the Commission meeting at which the request for confidentiality is acted upon by the Commission.

(8) The power exercisable under section 609(a) of the act to order a broker-dealer, agent, investment adviser or investment adviser representative registered under section 301 of the act (70 P. S. § 1-301) to furnish material information reasonably related to the registration.

(9) The power exercisable under sections 303(a)(i) and 609(a) of the act to order an applicant for registration as a broker-dealer, agent, investment adviser or investment adviser representative under section 301 of the act to furnish material information reasonably related to the application.

(10) The power exercisable under § 303.051(a) and (b) (relating to surety bonds).

(11) The power exercisable under section 305(d) of the act to issue a summary order with respect to an application for registration.

(c) The Commission delegates to the Director of the Division of Corporation Finance:

(1) The power exercisable under section 206(c) of the act (70 P. S. § 1-206(c)) to order effective a registration statement filed under section 206 of the act for securities that have met the requirements for registration under the Mid-Atlantic Regional Review Protocol for Small Corporate Offering Registrations.

(2) The power exercisable under section 204(b) of the act (70 P. S. § 1-204(b)) to:

(i) Issue summary orders denying or revoking exemptions from registration under section 202 or 203 of the act (70 P. S. § 1-202 or § 1-203).

(ii) Modify or vacate the summary orders.

(3) The power exercisable under section 609(f) of the act (70 P. S. 1-609(f)) with respect to applications for registration of securities.

(4) The power exercisable by the Commission to waive the provisions of § 504.060(a) and (b) (relating to rescission offers) when:

(i) The securities which are the subject of the rescission offer being made in this Commonwealth were sold to and purchased by no more than 35 persons during 12 consecutive months.

(ii) Disclosure satisfying the anti-fraud provisions of section 401(b) of the act (70 P. S. § 1-401(b)) will be given to a rescission offeree.

(5) The power exercisable under section 206(c) of the act to order effective a registration statement filed under section 206 of the act for securities of an issuer which meets all of the following:

(i) The issuer is an entity described in section 202(e)(i) of the act (70 P. S. § 1-202(e)(i)).

(ii) The issuer has not registered the securities with the United States Securities and Exchange Commission under section 5 of the Securities Act of 1933 (15 U.S.C.A. § 77e) in good faith reliance on section 3(a)(4) thereof (15 U.S.C.A. § 77c(4)).

(iii) The issuer, within the immediately preceding 18 months, had an effective registration statement with the Commission for similar securities.

(iv) The registration statement complies with the Statement of Policy Regarding General Obligation Financing by Religious Denominations adopted by the North American Securities Administrators Association (April 17, 1994) or any successor statement of policy.

(v) The issuer has not requested a waiver of any provision of the act or rule or order thereunder that otherwise would apply to the registration statement.

(vi) The issuer or any affiliate of the person currently is not subject or, within the past 10 years, was not subject to any of the following:

(A) An order described in section 305(a)(iv) of the act.

(B) An injunction described in section 305(a)(iii) of the act.

(C) A criminal conviction described in section 305(a)(ii) of the act.

(D) An order of the Commission issued under section 512 of the act (70 P. S. § 1-512).

(E) A court order finding civil contempt under section 509(c) of the act (70 P. S. § 1-509(c)).

(F) An order of the Commission imposing an administrative assessment under section 602.1 of the act (70 P. S. § 1-602.1) which has not been paid in full.

(6) The power exercisable under section 210 of the act (70 P. S. § 1-210) to grant effectiveness to an application filed under § 210.010 (relating to retroactive registration of certain investment company securities).

(7) The power exercisable under 1 Pa. Code § 33.42(a) (relating to withdrawal or termination) for proceedings under section 202, 203, 205 or 206 of the act.

(8) The power exercisable under section 603(c) of the act and § 603.031(c) to treat documents filed with the Division of Corporation Finance as temporarily confidential until the close of the Commission meeting at which the request for confidentiality is acted upon by the Commission.

(9) The power exercisable under section 206(c) of the act to order effective a registration statement filed with the Commission under section 206 of the act by an issuer which also has a currently effective registration statement for the same securities on file with the SEC.

(10) The power exercisable under section 211 of the act (70 P. S. § 1-211) to:

(i) Issue a stop order suspending the offer or sale of any security described in section 211(b) or (c).

(ii) Modify or vacate a stop order.

(11) The power exercisable under section 207(l) of the act (70 P. S. § 1-207(1)) to declare effective an amendment to any currently effective registration statement relating to the increase in the specified amount of securities proposed to be offered in this Commonwealth, if the applicable filing fee, if any, required by section 602(b.1) of the act (70 P. S. § 1-602(b.1)) has been paid.

(12) The power, exercisable under § 606.031(b)(2), (3)(ii) and (c)(3)(ii) (relating to advertising literature) to issue a letter disallowing publication of an advertisement in this Commonwealth in connection with the offer or sale of a security in this Commonwealth.

(d) The Commission delegates to the Chief Accountant the power to waive, in a filing with the Commission, a nonmaterial technical financial statement noncompliance with a provision relating to the form and content of financial statements.

(e) The Commission authorizes the following:

(1) The Chief Counsel, Deputy Chief Counsel or the Assistant Director of the Division of Corporation Finance may exercise the delegations given in this section in the absence of the Director of the Division of Corporation Finance.

(2) The Chief Counsel and Deputy Chief Counsel may exercise the delegations given in this section in the absence of the Director of the Division of Licensing.

The provisions of this § 606.041 adopted May 10, 1974, effective May 11, 1974, 4 Pa.B. 916; amended April 30, 1976, effective May 1, 1976, 6 Pa.B. 1007; amended June 1, 1979, effective June 2, 1979, 9 Pa.B. 1757; amended October 9, 1979, effective October 10, 1979, 9 Pa.B. 3746; amended May 2, 1980, effective May 3, 1980, 10 Pa.B. 1778; amended January 21, 1983, effective January 22, 1983, 13 Pa.B. 526; amended April 19, 1985, effective April 20, 1985, 15 Pa.B. 1432; amended January 24, 1986, effective January 25, 1986, 16 Pa.B. 255; amended November 28, 1986, effective November 29, 1986, 16 Pa.B. 4655; amended July 17, 1987, effective July 18, 1987, 17 Pa.B. 3029; amended April 28, 1989, effective April 29, 1989, 19 Pa.B. 1846; amended July 6, 1990, effective July 28, 1990, 20 Pa.B. 3688 and 4089; amended January 17, 1992, effective January 18, 1992, 22 Pa.B. 296; amended January 28, 1994, effective January 29, 1994, 24 Pa.B. 657; amended September 22, 1995, effective September 23, 1995, 25 Pa.B. 3994; amended January 8, 1999, effective January 9, 1999, 29 Pa.B. 202; amended December 30, 1999, effective January 1, 2000, 30 Pa.B. 18; amended December 28, 2001, effective December 29, 2001, 31 Pa.B. 7032; amended July 11, 2003, effective July 12, 2003, 33 Pa.B. 3365; transferred and renumbered from 64 Pa. Code § 606.041, December 14, 2012, effective December 15, 2012, 42 Pa.B. 7533. Immediately preceding text appears at serial pages (297514) and (317665) to (317668).

Notation

Authority

The provisions of this § 606.041 amended under sections 606(a) and (d) and 609(a) of the Pennsylvania Securities Act of 1972 (70 P. S. § § 1-606(a) and (d) and 1-609(a)).

Cross References

This section cited in 10 Pa. Code § 604.016 (relating to guidelines for waivers of Uniform Securities Agent State Law Examination (Series 63), Uniform Investment Adviser Law Examination (Series 65) and General Securities Representative Non-Member Examination (Series 2)—statement of policy).