TITLE 7. BANKING AND SECURITIES
PART 7. STATE SECURITIES BOARD
CHAPTER 101. GENERAL ADMINISTRATION
7 TAC §101.2
The Texas State Securities Board proposes an amendment to §101.2, concerning Classification of Regulatory Standards, to make nonsubstantive changes. The proposal would amend subsection (e) to conform terminology to the Texas Securities Act and existing rules. The statutory reference in subsection (f) would be updated to refer to the codified version of the Act, which became effective January 1, 2022. Subsection (f) would also be reorganized, and language concerning a fee that is duplicative of a section in the Act would be replaced with a reference to the statutory provision setting the amount of the fee.
The amendment is being made pursuant to the agency's periodic review of its rules.
Marlene Sparkman, General Counsel, has determined that for the first five-year period the proposed amendment is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the proposed amendment.
Ms. Sparkman has also determined that for each year of the first five years the proposed amendment is in effect the public benefit expected as a result of adoption of the proposed amendment would be improved clarity and statutory compliance by ensuring the rule is current and accurate and that it conforms to §4006.058 of the Act, which would promote transparency and efficient regulation. There will be no adverse economic effect on micro- or small businesses or rural communities. Since the proposed amendment will have no adverse economic effect on micro- or small businesses or rural communities, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the amendment as proposed. There is no anticipated impact on local employment.
Ms. Sparkman has also determined that for the first five-year period the proposed amendment is in effect: it does not create or eliminate a government program; it does not require the creation or elimination of existing employee positions; it does not require an increase or decrease in future legislative appropriations to this agency; it does not require an increase or decrease in fees paid to this agency; it does not increase or decrease the number of individuals subject to the rule's applicability; and it does not positively or negatively affect the state's economy. Additionally, the proposed amendment does not create a new regulation, or expand, limit, or repeal an existing regulation.
Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed section in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711‑3167 or faxed to (512) 305‑8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication.
The amendment is proposed under the authority of the Texas Government Code, Section 4002.151. Section 4002.151 provides the Board with the authority to adopt rules as necessary to implement the provisions of the Texas Securities Act, including rules governing registration statements, applications, notices, and reports; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes.
The proposed amendment affects Texas Government Code §4006.058.
§101.2. Classification of Regulatory Standards.
(a) - (d) (No change.)
(e) Opinions. Statements made and opinions expressed orally or in writing by personnel of the State Securities Board in response to inquiries or otherwise, and not specifically identified and promulgated as rules, shall not be considered regulatory standards of the Board and shall not be considered binding upon the Commissioner in connection with specific adjudications undertaken by the Commissioner thereafter. The Commissioner may refuse to answer any question based upon a hypothetical fact situation.
(f) Interpretations by General Counsel.
(1) The Board's General Counsel may respond to inquiries concerning interpretations of the Texas Securities Act or these sections, provided sufficient relevant facts are given and the situation is not hypothetical. [A nonrefundable fee of $100 must accompany each inquiry.] The General Counsel may refuse to respond to any inquiry. Responses to inquiries may take the following forms:
(A) - (B) (No change.)
(C) an opinion that, under the facts as stated by the inquiring party, a specific exemption appears to be available; this opinion must be followed by a caveat that:
(i) - (ii) (No change.)
(iii) the Texas Securities Act, §4006.153 [§37], places the burden of proof on the party claiming the exemption; and
(iv) (No change.)
(D) (No change.)
(E) a statement that no interpretation will be expressed with regard to a given fact situation; or
(F) (No change.)
(2) A nonrefundable fee in the amount set forth in the Texas Securities Act, §4006.058, must accompany each inquiry.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on March 27, 2023.
TRD-202301176
Travis J. Iles
Securities Commissioner
State Securities Board
Earliest possible date of adoption: May 7, 2023
For further information, please call: (512) 305-8303
CHAPTER 103. RULEMAKING PROCEDURE
7 TAC §103.6
The Texas State Securities Board proposes an amendment to §103.6, concerning Negotiated Rulemaking, to correct a typographical error in subsection (c). Specifically, the word "in" which is inadvertently missing from this subsection would be inserted where it was intended.
The need for the change was identified as a result of the agency's periodic review of its rules.
Clint Edgar, Deputy Securities Commissioner, has determined that for the first five-year period the proposed amendment is in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the proposed amendment.
Mr. Edgar has also determined that for each year of the first five years the proposed amendment is in effect the public benefit expected as a result of adoption of the proposed amendment will be to have a clear and accurate rule. There will be no adverse economic effect on micro- or small businesses or rural communities. Since the proposed amendment will have no adverse economic effect on micro- or small businesses or rural communities, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the amendment as proposed. There is no anticipated impact on local employment.
Mr. Edgar has also determined that for the first five-year period the proposed amendment is in effect: it does not create or eliminate a government program; it does not require the creation or elimination of existing employee positions; it does not require an increase or decrease in future legislative appropriations to this agency; it does not require an increase or decrease in fees paid to this agency; it does not increase or decrease the number of individuals subject to the rule's applicability; and it does not positively or negatively affect the state's economy. Additionally, the proposed amendment does not create a new regulation, or expand, limit, or repeal an existing regulation.
Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed section in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711‑3167 or faxed to (512) 305‑8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication.
The amendment is proposed under the authority of the Texas Government Code, Sections 4002.151 and 4002.1535. Section 4002.151 provides the Board with the authority to adopt rules as necessary to implement the provisions of the Texas Securities Act, including rules governing registration statements, applications, notices, and reports; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Section 4002.1535 requires the Board to develop a policy to encourage the use of negotiated rulemaking procedures under Chapter 2008, Government Code, for the adoption of Board rules; and appropriate alternative dispute resolution procedures under Chapter 2009, Government Code, to assist in the resolution of internal and external disputes under the Board's jurisdiction.
The proposed amendment affects Chapter 2008 of the Texas Government Code and the Texas Securities Act, Texas Government Code Sections 4001.001-4008.105.
§103.6. Negotiated Rulemaking.
(a) - (b) (No change.)
(c) Notice of intent to engage in negotiated rulemaking. After considering the convener's recommendation and report, the Commissioner may direct the Agency Staff to engage in negotiated rulemaking in accordance with the provisions of Government Code, Chapter 2008, and authorize the Agency Staff to perform the duties and requirements set forth in Chapter 2008, including providing any required notices, establishing a negotiated rulemaking committee, and appointing the members of the committee, and appointing a facilitator.
(d) - (f) (No change.)
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on March 27, 2023.
TRD-202301177
Travis J. Iles
Securities Commissioner
State Securities Board
Earliest possible date of adoption: May 7, 2023
For further information, please call: (512) 305-8303
CHAPTER 104. PROCEDURE FOR REVIEW OF APPLICATIONS
7 TAC §§104.2, 104.3, 104.6
The Texas State Securities Board proposes amendments to §104.2, concerning Purpose; §104.3, concerning Definition of Days; and §104.6, concerning Exceeding the Time Periods. The amendments are being made pursuant to the agency's periodic review of its rules.
Sections 104.2, 104.3, and 104.6 would be amended to more accurately refer to the relevant sections in the Chapter, and the reference to a section of the Texas Securities Act in subsection (f) of 104.6 would be updated to refer to the codified version of the Act in the Texas Government Code, which became effective January 1, 2022.
Clint Edgar, Deputy Securities Commissioner; and Emily Diaz and Shaun Yarroll, Assistant Directors, Registration Division, have determined that for the first five-year period the proposed amendments are in effect there will be no foreseeable fiscal implications for state or local government as a result of enforcing or administering the proposed amendments.
Mr. Edgar, Ms. Diaz, and Mr. Yarroll have also determined that for each year of the first five years the proposed amendments are in effect the public benefits expected as a result of adoption of the proposed amendments will be improved clarity and a statutory reference will conform to the codified version of the Act which would promote transparency and efficient regulation. There will be no adverse economic effect on micro- or small businesses or rural communities. Since the proposed amendments will have no adverse economic effect on micro- or small businesses or rural communities, preparation of an economic impact statement and a regulatory flexibility analysis is not required. There is no anticipated economic cost to persons who are required to comply with the amendments as proposed. There is no anticipated impact on local employment.
Mr. Edgar, Ms. Diaz, and Mr. Yarroll have also determined that for the first five-year period the proposed amendments are in effect: they do not create or eliminate a government program; they do not require the creation or elimination of existing employee positions; they do not require an increase or decrease in future legislative appropriations to this agency; they do not require an increase or decrease in fees paid to this agency; they do not increase or decrease the number of individuals subject to the rules' applicability; and they do not positively or negatively affect the state's economy. Additionally, the proposed amendments do not create a new regulation, or expand, limit, or repeal an existing regulation.
Comments on the proposal must be in writing and will be accepted for 30 days following publication of the proposed sections in the Texas Register. Written comments should be submitted to Marlene K. Sparkman, General Counsel, State Securities Board, P.O. Box 13167, Austin, Texas 78711‑3167 or faxed to (512) 305‑8336. Comments may also be submitted electronically to proposal@ssb.texas.gov. In order to be considered by the Board at adoption, comments must be received no later than 30 days following publication.
The amendments are proposed under the authority of the Texas Government Code, Section 4002.151. Section 4002.151 provides the Board with the authority to adopt rules as necessary to implement the provisions of the Texas Securities Act, including rules governing registration statements, applications, notices, and reports; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes.
The proposal affects Texas Government Code §2005.003, and the following sections of the Texas Securities Act: Texas Government Code §4002.154; Chapter 4003, Subchapters A, B, and C; and Chapter 4004, Subchapters A-G.
§104.2.Purpose.
Sections 104.2 - 104.6 of this title [These sections] are intended to implement the provisions of Texas Government Code, Chapter 2005. They are not intended to supersede any substantive requirement of the Texas Securities Act or Board rules. If a provision under one of these sections would cause such a conflict, the provision will not be given effect under the particular circumstances giving rise to the conflict.
§104.3.Definition of Days.
For purposes of §§104.2 - 104.6 of this title [these sections] "days" means each calendar day without any exclusions.
§104.6.Exceeding the Time Periods.
(a) The Agency may exceed the time periods set forth in §104.4 or §104.5 of this title [these sections] if:
(1) the number of permits and registration authorizations exceeds by 15% or more the number processed in the same calendar quarter of the preceding year;
(2) the Securities and Exchange Commission, CRD, IARD, or another public or private entity, including the applicant itself, causes the delay;
(3) the applicant requests delay; or
(4) other conditions exist that give the Agency good cause for exceeding the established time periods.
(b) If it appears to the applicant that for reasons other than those set forth in subsection (a)(2) of this section, the Agency exceeded the time periods [set forth in these sections], the applicant may appeal by filing a complaint in writing with the Deputy Commissioner who shall provide the staff with a copy of the complaint immediately.
(c) - (e) (No change.)
(f) If the complaint is decided in favor of the staff, the applicant may appeal the decision by requesting a hearing before the Commissioner pursuant to the Texas Securities Act, §4007.107(a) [§24.A].
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on March 27, 2023.
TRD-202301180
Travis J. Iles
Securities Commissioner
State Securities Board
Earliest possible date of adoption: May 7, 2023
For further information, please call: (512) 305-8303