An Act To Update and Amend the Revised Maine Securities Act
Maine Legislature, Session 121, LD 1489
Committee: Insurance and Financial Services
Sponsors: LaFOUNTAIN, O'NEIL, WOODBURY
Amends: 32 MRSA §10306, 32 MRSA §1030, 32 MRSA §10311, 32 MRSA §10313, 32 MRSA §10502, 32 MRSA §10505, 32 MRSA §10701, 32 MRSA §10702

Legislative Document 
No. 1489 
S.P.495 
In Senate, March 31, 2003 
An Act To Update and Amend the Revised Maine Securities Act 
Submitted by the Department of Professional and Financial Regulation pursuant to Joint 
Rule 204. 
Reference to the Committee on Insurance and Financial Services suggested and ordered 
printed. 
Presented by Senator LaFOUNTAIN of York. 
Cosponsored by Representative O'NEIL of Saco and 
Representative: WOODBURY of Yarmouth. 
Printed on recycled paper 
JOY J. O'BRIEN 
Secretary of the Senate 
Be it enacted by the People of the State of Maine as follows: 
Sec. I. 32 MRSA §I0302, sub-§2, 1JB, as enacted by PL 1985, c. 
400, §2, is amended to read: 
B. 
A sales representative who is otherwise emp-10yed by an 
issuer and acting for an issuer in effecting transactions in 
a 
security exempt by one or more paragraphs of section 
10502, subsection 1, except paragraphs E, F, G, H, I and J; 
Sec. 2. 32 MRSA §I0302, sub-§2, ,C, as amended by PL 1999, c. 
279, §1, is further amended to read: 
C. 
A sales representative who is otherwise employed by an 
issuer and acting for an issuer effecting offers or sales of 
securities in transactions exempt by one or more paragraphs 
of section 10502, subsection 2, except paragraph S; 
Sec. 3. 32 MRSA §I0302, sub-§2, ,D, as amended by PL 1991, c. 
82, §1, is further amended to read: 
D. 
A sales representative who is otherwise em};lloyed by an 
issuer and acting for an issuer effecting transactions with 
existing employees, partners, officers or directors of the 
issuer, a parent or wholly owned subsidiary of the issuer, 
provided that no commissions or other remuneration are paid 
or 
given 
directly 
or 
indirectly 
to 
that 
person 
for 
soliciting any employee, partner, officer or director in 
this State; and 
Sec. 4. 32 MRSA §I0306, sub-§I, 1rA, as amended by PL 1993, c. 
410, Pt. K, §3, is further amended to read: 
A. 
Broker-dealer, $200 
aBa--f-€>-i:-~-al'aBeR-.g.f·;f.,i~-in--t:Ri6 
St:at:eT-$§Q; 
Sec. 5. 32 MRSA §I0306, sub-§I, ,C, as amended by PL 2001, c. 
183, Pt. A, §4 and affected by §14, is further amended to read: 
C. 
Investment adviser, $200; aBa 
Sec. 6. 32 MRSA §I0306, sub-§I, 1[D, as enacted by PL 2001, c. 
183, Pt. A, §5 and affected by §14, is amended to read: 
D. 
Investment adviser representative, $40T~ 
Sec. 7. 32 MRSA §I0306, sub-§I, ~ is enae1ted t.o read: 
E. 
Each 
branch 
office 
in 
this 
St.a1t.e. 
as 
defined 
in 
subsection 3, $50. 
Page l-LR1912(1) 
Sec. S. 32 MRSA §10306, sub-§2, ,A, as amended by PL 1993, c. 
410, Pt. K, §4, is further amended to read: 
A. 
Broker-dealer, $200 ane-~~-~-aFaneh-~~~~-~-~h~s 
S~a~eT-$ag; 
Sec. 9. 32 MRSA §10306, sub-§2, ,C, as amended by PL 2001, c. 
183, Pt. A, §7 and affected by §14, is further amended to read: 
C. 
Investment adviser, $100; ane 
Sec. 10. 32 MRSA §10306, sub-§2,,n, as enacted by PL 2001, c. 
183, Pt. A, §8 and affected by §14, is amended to read: 
D. 
Investment adviser representative, $40T~ 
Sec. 11. 32 MRSA §10306, sub-§2, ~ is enacted to read: 
E. 
Each 
branch office 
in 
this 
State, 
as 
defined 
in 
subsection 3, $30. 
Sec. 12. 32 MRSA §10306, sub-§3-A is enacted to read: 
A. 
Duplicate branch fees. 
Notwithstanding subsection 1, 
paragraph E and subsection 2, paragraph E, only one branch office 
fee 
is 
due 
if 
an 
office 
is 
a 
branch 
office 
of 
both 
a 
broker dealer and an investment adviser affiliated by direct or 
indirect common control. 
Sec. 13. 32 MRSA §10306, sub-§4, as amended by PL 1989, c. 
542, §16, is further amended to read: 
4. 
Fees nonrefundable. 
If an application is denied 
eFL 
withdrawn 
or 
abandoned, 
or 
the 
license 
is 
terminated 
by 
revocation, cancellation or withdrawal, the administrator shall 
retain the fee paid. 
Sec. 14. 32 MRSA §1030S, sub-§I, as amended by PL 1989, c. 
542, §18, is further amended to read: 
1. 
Effective date of license. 
Unless a proceeding under 
section 
10313 
has--aeen 
is 
instituted, 
the 
license 
of 
any 
broker-dealer, 
sales representative 
9FL 
investment adviser or 
investment adviser representative becomes effective 30 days after 
an application for licensing and the last of any additional 
information requested by the administrator or the administrator's 
designee 
has 
been filed 
and 
pF9y~eee--~ha~ as 
long 
as 
all 
examination requirements imposed under section 10307 have--geea 
are satisfied. The administrator may, 
by order, 
imthorize an 
earlier effective date of licensing. 
Sec. 15. 32 MRSA §10311, sub-§2, as enacted by PL 1985, c. 
400, §2, is amended to read: 
2. 
Sales 
representatives; 
investment: 
adviser 
representatives. 
Licensing of the sales representatives of the 
broker-dealer 
or 
investment 
adviser 
representatives 
of 
the 
investment adviser filing the application under 
subsection 1 
shall-€GBt.4B\ie continues upon licensing of the successor and no 
separate filing or 
fee 
sha:ll--se II required for 
tohe 
their 
continued licensing ef-tohe-sales-Ee~EeseRtoatoives. 
Sec. 16. 32 MRSA §10313, sub-§7 is enacted to read: 
7. 
Abandomnent of license application. 
A pending license 
application may be considered abandoned if the administrator has 
not received a response to inquiries or deficiency notices for a 
period of at least 120 days. 
The administrator shall send an 
abandonment notice to the last known address of the applicant. 
The applicant must respond to the abandonment notice within 30 
days to avoid an abandonment determination. 
The abandonment of 
an application does not preclude the filing of 
a 
subsequent 
application for licensure. 
Sec. 17. 32 MRS A §1040S, sub-§2, as amended by PL 1993, c. 
410, Pt. K, §5, is further amended to read: 
2. 
Fees. 
A person filing a registration statement must pay 
a filing fee of $500 for each security offered, except that for a 
registration statement filed under section 10404 for an offering 
for which the total amount raised in state and out of state does 
not exceed $1,000,000, the filing fee is $300 for each security 
offered. 
When a registration statement is withdrawn before the 
effective date or abandoned pursuant to section 10406, subsection 
.2 or a preeffective stop order is entered under section 10406, 
the administrator retains the fee. 
Sec. IS. 32 MRS A §10406, sub-§S is enacted to read:: 
5. 
Abandoument of filing. 
A registration statement that is 
pending 
effectiveness 
may 
be 
considered 
abandoned 
if 
the 
administrator 
has 
not 
received 
a 
response 
to 
inquiries 
or 
deficiency notices for 
a 
period of at least 120 days. 
The 
administrator shall send an abandonment notice to the last known 
address of the filer. 
The filer must respond to the abandonment 
notice within 30 days to avoid an abandonment determination. 
The 
abandonment of a registration statement does not 'I?reclude the 
filing of a subsequent registration statement. 
Sec. 19. 32 MRSA §10502, sub-§§8 and 9 are enacted to read: 
8. 
Abandonment of exemption or notice filing. 
An exemption 
filing or notice filing required pursuant to this section may be 
considered abandoned if the administrator has not received a 
response to inquiries or deficiency notices for a period of at 
least 120 days. 
The administrator shall send an abandonment 
notice to the last known address of the filer. 
The filer must 
respond to the abandonment notice wi thin 30 days to avoid an 
abandonment determination. 
The abandonment of a filing does not 
preclude the filing of a subsequent exemption filing or notice 
filing. 
9. 
Fees nonrefundable. 
If an exemption filing or notice 
filing 
is 
withdrawn, 
abandoned, 
denied 
or 
revoked, 
the 
administrator shall retain the fee paid. 
Sec. 20. 32 MRS A §10504~ sub-§I, as amended by PL 1999, c. 
279, §9, is further amended to read: 
1. 
Filing 
of 
sales 
and 
advertising 
literature. 
The 
administrator, by rule or order, may require the filing of any Q 
prospectus, 
pamphlet, 
circular, 
form letter, 
advertisement or 
other sales literature 9FL 
advertising communication or business 
plan 
addressed 
or 
intended 
for 
distribution 
to 
prospective 
investors, 
including 
clients 
or 
prospective 
clients 
of 
an 
investment adviser, unless the security is a 
federal covered 
security 
or 
the 
security 
or 
transaction 
qualifies 
for 
an 
exemption under section 10502, subsection 2, paragraphs A to R 
for which the filing of a notice with the administrator is not 
required. 
Sec. 21. 32 MRSA §10505, sub-§4, as enacted by PL 1997, c. 
168, §28, is repealed. 
Sec. 22. 32 MRSA §10505, sub~§4-A is enacted to read: 
4-A. 
Fees 
nonrefundable. 
If 
a 
notice filing required 
pursuant to this section is withdrawn, abandoned or the subject 
of a stop order, the administrator shall retain the fee paid. 
A 
notice filing may be considered abandoned if the administrator 
has not received a response to inquiries or deficiency notices 
for a period of at least 120 days. 
The administrator shall send 
an abandonment notice to the last known address of the filer. 
The filer must respond to the abandonment notice within 30 days 
to avoid an abandonment determination. 
The 
abandonment of 
a 
filing does not preclude the filing of a subsequent exemption or 
notice filing. 
Sec. 23. 32 MRSA §10701, sub-§S, as amended by PL 1989, c . 
542, §55, is further amended to read: 
5. 
Disclosure for enforcement purposes. 
The administrator 
may disclose 
any information obtained in connection with an 
investigation pursuant to section 10601 that would otherwise be 
nonpublic 
information 
to 
the 
see~~ities 
agencies 
and 
administrators specified in section 10702, subsection 1, but only 
if 
disclosure 
is 
required 
for 
the 
purpose 
of 
a 
civil, 
administrative or 
criminal 
enforcement 
investigation 
and 
the 
requesting agency certifies that under applicable law reasonable 
protections exist to preserve the integrity, confidentiality and 
security 
of 
the 
information, 
comparable 
to 
the 
protections 
existing under the laws of this State. 
Sec.24. 32 MRSA §10701, sub~§5-A is enacted to read: 
5-A. 
Public disclosure 
for 
enforcement 
purposes. 
The 
administrator may disclose any information obtained in connection 
with 
an 
investigation pursuant 
to 
section 
10601 
that would 
otherwise be nonpublic information to the public, but only if the 
administrator determines that disclosure is necessary for the 
protection of investors or the public. 
Sec. 25. 32 MRSA §10702, sub-§2, 1fH, as enacted by PL 1985, c. 
400, §2, is amended to read: 
H. 
Issuing and enforcing subpoenas at the request of a 
federal or another state securities agency or the United 
States 
Commodity 
Futures 
Trading 
Commission, 
if 
the 
activities constituting an alleged violation for which the 
information is sought would also be a violation of this Act 
if the activities had taken place in this State ap-a-F~eviaea 
that-aily-~-5{ffi--aga-in&t:--whGm-a--6~~eila--may--be--i-&&~-sha±± 
Rave--an-~~~&~n~&y--~~-~~~-~~~-~£e--6HaFeeBa--i6 
issHea. 
SUMMARY 
The bill does the following: 
1. 
It clarifies that sales 
repre~entatives acting for an 
issuer in effecting any securities transactions are only exempt 
from licensing requirements if they are bona fide employees of 
the issuer; 
2. 
It clarifies 
existing 
broker-dealer 
and 
investment 
adviser branch office fees and specifies that a branch location 
that is the office of' both 
an affiliated broker-dealer 
and 
investment adviser will not be assessed duplicative fees; 
3. 
It clarifies that, with respect to successor 
neither 
sales 
representatives 
nor 
investment 
representatives will be required to be relicensed; 
firms, 
adviser 
4. 
It adds abandonment provisions with fee retention for 
applications, filings, exemptions and federal covered securities; 
5. 
It adds 
business 
plans 
to 
the 
advertising materials that may be required 
Securities Administrator; 
list of 
sales 
and 
to be filed with the 
6. 
It repeals expired transitional language; 
7. 
It adds 
a 
provision 
for 
the 
public disclosure 
of 
confidential information for public protection purposes; and 
8. 
It eliminates the hearing requirement prior to the 
issuance of 
a 
federal or another states's subpoena when the 
alleged violation would also be a violation of Maine law.