South Carolina Administrative Code

13-304. Underwriting Expenses, Underwriter Warrants, Selling Expenses, and Selling Security Holders. A. An offer or sale of securities may be disallowed by the Securities Commissioner if the underwriting expenses to be incurred exceed seventeen (17%) percent of the gross proceeds…

13-305. Options and Warrants. A. Options or warrants may be issued to underwriters as compensation in connection with a public offering provided those options or warrants comply with the requirements of Rule 13-304. B. Options or warrants may be granted to unaffiliated institutio…

13-306. Form and Minimum Provisions for Debt Securities. A. Provisions or terms of an issue of debt securities shall be considered inadequate for the protection of the security holders, and shall be considered grounds for denial of an application for registration under Section 35…

13-307. Promoters’ Equity. A public securities offering by a promotional or development stage company may be disallowed by the Securities Commissioner if the promoter’s equity investment is less than: A. Ten percent (10%) of the first one million ($1,000,000.00) dollars of the ag…

13-308. Required Filings for Federal Covered Securities Under Regulation D Rule 506 of the Securities Act of 1933. A. With respect to a security that is a federal covered security under Section 18(b)(4)(D) of the Securities Act of 1933 (15 U.S.C. Section 77r(b)(4)(D)), or as late…

13-309. Offerings Made Under Tier 2 of Federal Regulation A. A. Initial Filings. An issuer planning to offer and sell securities in this state in an offering exempt under Tier 2 of federal Regulation A shall submit the following at least 21 calendar days prior to the initial sale…

13-4. Repealed. HISTORY: Former Regulation, titled Records Concerning Charitable Purposes Only May Be Inspected, repealed by SCSR 45-5 Doc. No. 4982, eff May 28, 2021.

13-401. Examinations for Securities Agents, Investment Advisers, and Investment Adviser Representatives. A. Examinations for securities agents. A passing grade on an examination appropriate based upon the type of securities being sold, and the Uniform Securities Agent State Law E…

13-402. Exemptions for Certain Canadian Broker-Dealers. A. A broker-dealer that is registered in Canada and that does not have a place of business in this State shall be exempt from the registration requirements of Section 35-1-401 of the South Carolina Uniform Securities Act of …

13-403. Broker-Dealer, Agent, Investment Adviser, and Investment Adviser Representa- tive Registrations, Terminations, and Brochure Delivery. A. Investment Advisers. (1) Initial Registration: The application for initial registration as an investment adviser pursuant to Sections 3…

13-404. Criminal Record Requirement for Agents and Investment Adviser Representa- tives. Pursuant to Section 35-1-406 (a)(2), every person applying for registration as an agent or investment adviser representative in this State must request the South Carolina Law Enforcement Divi…

13-405. Broker-Dealer Recordkeeping, Minimum Financial Reporting and Bonding Re- quirements. A. Broker-Dealer Recordkeeping Requirements. (1) Unless otherwise provided by order of the United States Securities and Exchange Commission (‘‘SEC’’), each broker-dealer registered or req…

13-406. Investment Adviser Minimum Capital and Bonding Requirements. A. Minimum financial requirements for investment advisers. Unless an investment adviser posts a bond pursuant to 35-1-411(e) and Section B below an investment adviser registered or required to be registered purs…

13-407. Cash or Security Deposits in Lieu of Surety Bond. A deposit of cash or securities in lieu of the surety bond required by Rule 13-406 shall be considered appropriate within the intent and meaning of such section and shall be accepted by the Securities Commissioner under th…

13-408. Recordkeeping Requirements for Investment Advisers. A. Every investment adviser registered or required to be registered under the South Carolina Uniform Securities Act of 2005 shall make and keep true, accurate and current the following books, ledgers and records: (1) A j…

13-409. Sole Proprietor Investment Advisers. An individual acting as a sole proprietor who meets the definitions of investment adviser in Section 35-1-102(15) of the Act, and investment adviser representative in Section 35-1-102(16) of the Act, must register in South Carolina as …

13-410. Investment Adviser Representatives Registered with Multiple Investment Advis- ers. A. An individual may apply to be registered as an investment adviser representative for more than one investment adviser or federal covered investment adviser by the filing of a separate Fo…

13-411. The Use of Senior-Specific Certifications and Professional Designations. A. The use of senior-specific certification or designation by any person in connection with the offer, sale, or purchase of securities, or the provision of advice as to the value or the advisability …

13-412. Fees. Every applicant applying for registration as an agent of the issuer shall pay the below specified, non- refundable fees: A. Agent of the Issuer (initial filing fee): One hundred ten dollars; B. Agent of the Issuer (renewal): One hundred ten dollars. HISTORY: Added b…

13-413. Investment Adviser Information Security and Privacy. A. Every investment adviser registered or required to be registered shall establish, implement, update, and enforce written physical security and cybersecurity policies and procedures reasonably designed to ensure the c…

13-414. Business Continuity and Succession Planning. A. Every investment adviser shall establish, implement, and maintain written procedures relating to a business continuity and succession plan. The plan shall be based upon the facts and circumstances of the investment adviser’s…

13-415. Registration Exemption for Investment Advisers to Private Funds. A. Definitions. For purposes of this regulation, the following definitions shall apply: (1) ‘‘3(c)(1) fund’’ means a qualifying private fund that is eligible for the exclusion from the definition of an inves…

13-416. Registration Exemption for Merger and Acquisition Brokers. A. Except as provided in sections B and C below, a Merger and Acquisition Broker shall be exempt from registration pursuant to Section 35-1-401. B. Excluded Activities. A Merger and Acquisition Broker is not exemp…

13-501. Dishonest or Unethical Practices by Broker-Dealers and Agents. A. Broker-Dealers. Each broker-dealer shall observe high standards of commercial honor and just and equitable principles of trade in the conduct of their business. Acts and practices, including but not limited…

13-502. Dishonest or Unethical Practices by Investment Advisers, Investment Adviser Representatives and Federal Covered Advisers. A. A person who is an investment adviser, an investment adviser representative or a federal covered investment adviser is a fiduciary and has a duty t…

13-503. Advertising Filing Requirement. Any prospectus, pamphlet, circular, form letter, advertisement, sales literature, or other advertising relating to a security, addressed or intended for distribution to prospective investors under the South Carolina Uniform Securities Act o…

13-601. Financial Statements Submitted with an Application to Register Securities or used in a Prospectus. A. All financial statements submitted with an application to register securities or for inclusion in a Prospectus used in this State, except a Prospectus relating to a feder…

13-602. Prospectus, Offering Circular, Exemption and Exception Filing Fees. A. Filing fees to accompany prospectus or offering circular . (1) A filing fee of fifty ($50.00) dollars shall accompany any Prospectus or Offering Circular amended subsequent to effectiveness of registra…

13-603. Consents to Service of Process. The following forms constitute compliance with Section 35-1-611(a) of the South Carolina Uniform Securities Act of 2005: A. For broker-dealers, a fully executed Execution Page of the Form BD, Uniform Application for Broker-Dealer Registrati…

13-604. Procedures for Administrative Hearings before the Securities Commissioner. A. This regulation shall apply to Administrative Hearings held pursuant to Sections 35-1-306, 35-1-412, and 35-1-604. B. To the extent that they do not conflict with the definitions set forth in Se…

14-1. Examinations. A. Examinations for licensure as required by statute for apprentice auctioneers, auctioneers and auction firms shall be administered as approved by the Commission. B. A completed initial application for licensure must be received with a non-refundable applicat…

14-10. Appeal. A person aggrieved by a final action of the Commission may appeal the decision to the Administra- tive Law Court in accordance with the Administrative Procedures Act and the rules of the Administra- tive Law Court. HISTORY: Amended by State Register Volume 25, Issu…

14-11. Written Agreements and Escrow Accounts Relating to Auctions. A. The Commission shall have the authority to demand a copy of any written agreement or records of an auction which the licensee is required to maintain by 40-6-290, Code of Laws of South Carolina, 1976, (as amen…

14-12. Renewal Applications and Lapsed Licenses. A. All applications for renewal of licenses shall be filed with the Commission on or before June 30 of the renewal period. A late fee shall be paid thereafter for a license renewal application received on or before July 31 of the r…

14-13. Repealed. HISTORY: Former Regulation, titled Conditions for Apprentice; Exceptions, had the following history: Amend- ed by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001. Repealed by SCSR 45-5 Doc. No. 5010, eff May 28, 2021.

14-14. Repealed. HISTORY: Former Regulation, titled Duplicate Wall or Pocket Card License; Fees, had the following history: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001. Repealed by SCSR 43-5 Doc. No. 4846, eff May 24, 2019.

14-15. Apprentice Auctioneer’s Supervision, Requirements, Exception and Termination. A. An apprentice license is valid only while the licensee has a licensed auctioneer who serves as the licensee’s duly appointed supervisor. No apprentice auctioneer may enter into an agreement to…

14-16. Auctioneer, Apprentice Prohibited From Working For Unlicensed Firm; Excep- tion; Penalty. No licensed auctioneer or apprentice auctioneer shall be employed as an auctioneer or apprentice auctioneer by an auction firm unless that firm holds a valid auction firm license issu…

14-17. Repealed. HISTORY: Former Regulation, titled License Certification, had the following history: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001. Repealed by SCSR 43-5 Doc. No. 4846, eff May 24, 2019.

14-2. Reporting of Continuing Education. A. Eight hours of continuing education credit must be reported on each biennial renewal application on a form provided by the Commission. All credits must be earned during the previous licensing period and at Commission-approved classes. I…

14-3. Change of Address. Licensees shall notify the Commission in writing of each change of address or change of business trade name within ten days of such change. HISTORY: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001; SCSR 45-5 Doc. No. 5010, eff M…

14-4. Display of License and Advertising. A. All licensees shall prominently display their licenses at their business address and the pocket card shall be carried by the licensee when conducting auction business. B. All advertisements for an auction shall contain the name and lic…

14-5. Repealed. HISTORY: Former Regulation, titled Advertising, had the following history: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001. Repealed by SCSR 45-5 Doc. No. 5010, eff May 28, 2021.

14-6. Licensees Prohibited from Using Unlicensed Bid Callers. Licensees are prohibited from allowing an unlicensed bid caller to cry bids at an auction. HISTORY: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001; SCSR 45-5 Doc. No. 5010, eff May 28, 2021.

14-7. Repealed. HISTORY: Former Regulation, titled Professional Standards, had the following history: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001. Repealed by SCSR 43-5 Doc. No. 4846, eff May 24, 2019.

14-8. Repealed. HISTORY: Former Regulation, titled Falsification of Documents, had the following history: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001. Repealed by SCSR 43-5 Doc. No. 4846, eff May 24, 2019.

14-9. Repealed. HISTORY: Former Regulation, titled Declaratory Rulings, had the following history: Amended by State Register Volume 25, Issue No. 5, Part 2, eff May 25, 2001. Repealed by SCSR 43-5 Doc. No. 4846, eff May 24, 2019.