The Birmingham age-herald., 1924-09-21
SECURITY SELLERS
 MUST GIVE PROOF
No Attempt Is Made To Present Definition Of
 Speculative Security
OATES RETAINS
 SAME POSITION
Old Blue Sky Act Of 1920 Ma terially, Amended In New Code
tstate Capital Bureau.)

MONTGOMERY, Ala, Sept. 20.- Alabama's securities law, or Blue Sky" law, as found in the 1923 code, contains material anendenersts to the Blue Sky act of 1920, the changes plac- tng the Alabama law in the very front tank among enactments of this kind, ac- eording to experienced observers.
 The big feature wherein the new law is different from the old is in the change of the, burden of proof. The old securities act sought to define what constituted speculative securities, re- auiring a permit from the securities commission. Under this law, in case prosecution was instituted against a promoter, the burden was on the prose cution to show that the securities in question were speculative securities within the meaning of the act.
 The new law does not attempt to define speculative securities but on the contrary includes all securities, ex- eept for certain classes specifically exempted. Under the new law, no se- Gurity shall be sold in the state until Nt has been passed upon by the securi- ties commission and admitted to record in the register of qualified securities, exeept for certain classes of securities and certain transactions which are spe- officially exempted from the operation of the law.
 Burden On Seller
 Under the new law, the burden of proof is on the seller of securities to show that his security is in the class of those exempted from the operation of the law. If security is sold without permission from the commission. when It was not entitled to be so sold, such sale is void at the election of the pur- chaser, and the seller is liable to the purchased for the full amount paid bv him. The sale of any security not qualified with the commission and not exempted by the law from qualifying, Is made prima facie evidence of viola tion of the law.
 The idea of this change in the burden of proof was originated by Capt. Will liam c. Oats, who has been with the securities commission since the estab- lishment of the Blue Sky law, first as executive officer, and under the new law, holding the same position with the title of secretary examiner. Captain Oates has attracted widespread atten- tion through his work in handling the pIOUtc1uS OI IcSuidIAuS 4edAc oA SOIuAt ties, and has drafted several laws deal- ing with this question.
 The advisability of the change in the securities law of the state was shown by decision of the supreme court handed down in July of the pres ent year, holding part of the old se- curities law, defining speculative securi- ties, to be unconstitutional, Captain Oates stated that these constitutional defects have in the opinion of the com mission, been entirely cured by the law as contained in the new code.
 Law Is Praised.
 Captain Oates stated that the de- rartment has received since August IT, last, more than two hundred letters requesting either information concern ing the new codified securities law, or copies of it. Letters on file in the office of the commission from authori- ties on Blue Sky legislation Throughout the country express the opinion that Alabama now has the best Blue Sky law in the United States. Captain Oates stated that the commission has ordered supply of pamphlet copies of the law printed for distribution, but these have not yet been received from the printer.
 Among changes in the codified law is that relative to fees required. The old law required straight filing fee of $100, plus a permit fee of $50 if q permit was issued; while the new law requires fee in connection with the filing of applications of $25 for each class of securities, plus 50 cents per $1 900 of securities.