Arizona Administrative Code › Title 14 - PUBLIC SERVICE CORPORATIONS; CORPORATIONS AND ASSOCIATIONS; SECURITIES REGULATION › Chapter 6 - Corporation Commission - Investment Management › Article 2 - DUTIES OF INVESTMENT ADVISERS AND INVESTMENT ADVISER REPRESENTATIVES › Section R14-6-205 - Information to be Furnished to Clients ("Brochure Rule")

Current through Register Vol. 30, No. 28, July 12, 2024
A. Each investment
				adviser licensed or required to be licensed under the IM Act shall furnish each
				client and prospective client with a written disclosure statement that may be
				either a copy of Part II of its Form ADV or a written document containing at
				least the information required by Part II of Form ADV.
B. The information required to be disclosed
				by subsection (A) shall be disclosed to clients not less than 48 hours prior to
				entering into any written or oral investment advisory contract, or no later
				than the time of entering into such contract if the client has the right to
				terminate the contract without penalty within 5 business days after entering
				into the contract.
C. An investment
				adviser need not deliver the statement required by subsection (A) in connection
				with entering into an investment company contract or a contract for impersonal
				advisory services. The investment adviser shall, however, offer in writing to
				deliver the statement within 7 business days upon receipt of a written
				request.
D. Without charge and to
				each of its clients, an investment adviser licensed or required to be licensed
				under the IM Act shall annually deliver, or offer in writing to deliver within
				7 business days upon receipt of a written request, the statement required by
				this Section.
E. If an investment
				adviser licensed or required to be licensed under the IM Act renders
				substantially different types of investment advisory services to different
				clients, any information required by Part II of Form ADV may be omitted from
				the statement furnished to the client or prospective client if such information
				is applicable only to a type of investment advisory service or fee that is not
				rendered or charged, or proposed to be rendered or charged, to that client or
				prospective client.
F. Nothing in
				this Section shall relieve any investment adviser from any obligation pursuant
				to any provision of the IM Act or the rules and regulations thereunder or other
				federal or state law to disclose any information to its clients or prospective
				clients not specifically required by this Section.
G. An investment adviser licensed or required
				to be licensed under the IM Act that is compensated under a wrap fee program
				for sponsoring, organizing, or administering the program, or for selecting, or
				providing advice to clients regarding the selection of, other investment
				advisers in the programs, shall, in lieu of the written disclosure statement
				required by subsection (A) and in accordance with the other subsections of this
				Section, furnish each client and prospective client of the wrap fee program
				with a written disclosure statement containing at least the information
				required by Schedule H of Form ADV. Any additional information included in such
				disclosure shall be limited to information concerning wrap fee programs
				sponsored by the investment adviser.
H. If the investment adviser is required
				under subsection (G) to furnish disclosure statements to clients or prospective
				clients of more than one wrap fee program, the investment adviser may omit from
				the disclosure statement furnished to clients and prospective clients of a wrap
				fee program or programs any information required by Schedule H that is not
				applicable to clients or prospective clients of that wrap fee program or
				programs.
I. An investment adviser
				need not furnish the written disclosure statement required by subsection (G) to
				clients and prospective clients of a wrap fee program if another investment
				adviser is required to furnish and does furnish the written disclosure
				statement to all clients and prospective clients of the wrap fee
				program.