§1625 — Title 43 Public Lands | U.S. Code

Summary

Exempts Native Corporations from the Investment Company Act of 1940, the Securities Act of 1933, and the Securities Exchange Act of 1934 until the earliest of three events happens: the day after the corporation sells shares that are not Settlement Common Stock in a deal that is not already exempt and the buyers are people or groups other than certain Alaska Native-related owners (people who held shares on February 3, 1988; Natives and their descendants; people who inherited Settlement Common Stock under section 1606(h)(2); Settlement Trusts; or entities set up only for Natives or their descendants); the day after alienability restrictions end; or the day after the corporation files a registration statement with the Securities and Exchange Commission under the Securities Act or the Exchange Act. The law does not decide whether a Native Corporation is subject to those Acts after those dates. A Native Corporation that otherwise would fall under the Exchange Act must yearly send its shareholders a report with roughly the same information an Exchange Act company must include in its annual report. Holders of Settlement Common Stock are not counted when figuring the number of record shareholders under section 12(g). Before January 1, 2001, the Investment Company Act does not apply to a Native Corporation or a subsidiary that is wholly owned if the corporation owns at least 95% of the subsidiary. The Investment Company Act also does not apply to any Settlement Trust. A Native Corporation that would meet the Investment Company Act’s definition of an investment company may choose to register under that Act and then must follow its rules.

Title 43, §1625

Public Lands — Source: USLM XML via OLRC

(a)A Native Corporation shall be exempt from the provisions, as amended, of the Investment Company Act of 1940 (54 Stat. 789) [15 U.S.C. 80a–1 et seq.], the Securities Act of 1933 (48 Stat. 74) [15 U.S.C. 77a et seq.], and the Securities Exchange Act of 1934 (48 Stat. 881) [15 U.S.C. 78a et seq.] until the earlier of the day after—

(1)the date on which the corporation issues shares of stock other than Settlement Common Stock in a transaction where—

(A)the transaction or the shares are not otherwise exempt from Federal securities laws; and

(B)the shares are issued to persons or entities other than—

(i)individuals who held shares in the corporation on February 3, 1988;

(ii)Natives;

(iii)descendants of Natives;

(iv)individuals who have received shares of Settlement Common Stock by inheritance pursuant to section 1606(h)(2) of this title;

(v)Settlement Trusts; or

(vi)entities established for the sole benefit of Natives or descendants of Natives; or

(2)the date on which alienability restrictions are terminated; or

(3)the date on which the corporation files a registration statement with the Securities and Exchange Commission pursuant to either the Securities Act of 1933 [15 U.S.C. 77a et seq.] or the Securities Exchange Act of 1934 [15 U.S.C. 78a et seq.].

(b)No provision of this section shall be construed to require or imply that a Native Corporation shall, or shall not, be subject to provisions of the Acts listed in subsection (a) after any of the dates described in subsection (a).

(c)(1)A Native Corporation that, but for this section, would be subject to the provisions of the Securities Exchange Act of 1934 [15 U.S.C. 78a et seq.] shall annually prepare and transmit to its shareholders a report that contains substantially all the information required to be included in an annual report to shareholders by a corporation subject to that Act.

(2)For purposes of determining the applicability of the registration requirements of the Securities Exchange Act of 1934 on or after the date described in subsection (a), holders of Settlement Common Stock shall be excluded from the calculation of the number of shareholders of record pursuant to section 12(g) of that Act [15 U.S.C. 78l(g)].

(d)(1)Notwithstanding any other provision of law, prior to January 1, 2001, the provisions of the Investment Company Act of 1940 [15 U.S.C. 80a–1 et seq.] shall not apply to any Native Corporation or any subsidiary of such corporation if such subsidiary is wholly owned (as that term is defined in the Investment Company Act of 1940) by the corporation and the corporation owns at least 95 per centum of the equity of the subsidiary.

(2)The Investment Company Act of 1940 shall not apply to any Settlement Trust.

(3)If, but for this section, a Native Corporation would qualify as an Investment Company under the Investment Company Act of 1940, it shall be entitled to voluntarily register pursuant to such Act and any such corporation which so registered shall thereafter comply with the provisions of such Act.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The Investment Company Act of 1940, referred to in subsecs. (a) and (d), is title I of act Aug. 22, 1940, ch. 686, 54 Stat. 789, which is classified generally to subchapter I (§ 80a–1 et seq.) of chapter 2D of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see section 80a–51 of Title 15 and Tables. The Securities Act of 1933 (48 Stat. 74), referred to in subsec. (a), is act

May 27, 1933, ch. 38, title I, 48 Stat. 74, which is classified generally to subchapter I (§ 77a et seq.) of chapter 2A of Title 15. For complete classification of this Act to the Code, see section 77a of Title 15 and Tables. The Securities Exchange Act of 1934, referred to in subsecs. (a) and (c), is act

June 6, 1934, ch. 404, 48 Stat. 881, which is classified principally to chapter 2B (§ 78a et seq.) of Title 15. For complete classification of this Act to the Code, see section 78a of Title 15 and Tables.

Amendments

1988—Pub. L. 100–241 amended section generally. Prior to amendment, section read as follows: “Any corporation organized pursuant to this chapter shall be exempt from the provisions of the Investment Company Act of 1940 (54 Stat. 789) [15 U.S.C. 80a–1 et seq.], the Securities Act of 1933 (48 Stat. 74) [15 U.S.C. 77a et seq.], and the Securities Exchange Act of 1934 (48 Stat. 881), as amended [15 U.S.C. 78a et seq.], through December 31, 1991. Nothing in this section, however, shall be construed to mean that any such corporation shall or shall not, after such date, be subject to the provisions of such Acts. Any such corporation which, but for this section, would be subject to the provisions of the Securities Exchange Act of 1934 shall transmit to its stockholders each year a report containing substantially all the information required to be included in an annual report to stockholders by a corporation which is subject to the provisions of such Act.”

Statutory Notes and Related Subsidiaries

Construction

of Alaska Native Claims Settlement Act With Pub. L. 94–204 Pub. L. 94–204, § 18, Jan. 2, 1976, 89 Stat. 1156, provided that: “Except as specifically provided in this Act [enacting this section and section 1626 and 1627 of this title, amending section 1615, 1616, 1620 and 1621 of this title, and enacting provisions set out as notes under this section and section 1604, 1605, 1611, 1613, and 1618 of this title], (i) the provisions of the Settlement Act [this chapter] are fully applicable to this Act, and (ii) nothing in this Act shall be construed to alter or amend any of such provisions.”

§1625 Securities Laws Exemption