November 21, 2021

TITLE 7. BANKING AND SECURITIES

PART 7. STATE SECURITIES BOARD.

CHAPTER 101. GENERAL ADMINISTRATION.

7 TAC §101.7

The Texas State Securities Board adopts new rule §101.7, concerning References to the Texas Securities Act in Board Rules, without changes to the proposed text as published in the September 17, 2021, issue of the Texas Register (46 TexReg 6009). The new rule will not be republished.

The new rule provides interim guidance to the industry and public until the Board rules are updated during the next rule review cycle beginning in September 2022. Specifically, subsection (a) of new §101.7 provides a short history of the upcoming transition of the current Texas Securities Act from the Civil Statutes (e.g., the non-codified version) to the codified version of the Act to be located in the Government Code (which will become effective January 1, 2022) and refers readers to a disposition table posted on the Agency's website. Subsection (b) clarifies that a Board rule that references or cites the non-codified version of the Act is also a reference or cite to the equivalent provision in the codified Act. Subsection (c) clarifies that when a Board rule is amended in the future to refer to the codified Act, the requirements, obligations, or duties that existed in such rule will be preserved and continue to apply. The new rule also clarifies that existing provisions under the Board rules will continue to apply to activities occurring prior to a later update of the rules.

The rule assists the public and industry when reading the board rules to understand the effect of the non-substantive codification and directs them to a resource to locate the correct codified sections of the Act which correspond to the former, non-codified sections of the Act appearing in the rules.

No comments were received regarding adoption of the new rule.

The new rule is adopted under Texas Civil Statutes, Article 581-28-1. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes.

The adopted new rule affects: none applicable.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on November 1, 2021.

TRD-202104383

Travis J. Iles

Securities Commissioner

State Securities Board

Effective date: November 21, 2021

Proposal publication date: September 17, 2021

For further information, please call: (512) 305-8303


7 TAC §101.8

The Texas State Securities Board adopts new rule §101.8, concerning Employee Leave Pools, without changes to the proposed text as published in the September 17, 2021, issue of the Texas Register (46 TexReg 6010). The new rule will not be republished.

The new rule prescribes procedures relating to the operation of the Agency's family leave pool and sick leave pool, as required by Government Code, Chapter 661, and the Government Code, Section 661.002. The new rule sets forth the purpose of each leave pool, designates the Securities Commissioner as the administrator of the leave pools, and requires the Commissioner to develop and implement operating procedures consistent with the requirements of the new rule and relevant laws governing operation of the pools.

The Agency is in compliance with the directives of the legislature.

No comments were received regarding adoption of the new rule.

The new rule is adopted under the authority of Government Code, §661.002 and §661.022. Section 661.002 requires that the governing body of each state agency adopt rules and prescribe procedures relating to the operation of an agency's sick leave pool. Section 661.022 requires the governing bodies of state agencies to adopt rules to create and administer an employee family leave pool.

The adopted new rule affects Government Code, Chapter 661.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on November 1, 2021.

TRD-202104385

Travis J. Iles

Securities Commissioner

State Securities Board

Effective date: November 21, 2021

Proposal publication date: September 17, 2021

For further information, please call: (512) 305-8303


CHAPTER 115. SECURITIES DEALERS AND AGENTS.

7 TAC §115.18

The Texas State Securities Board adopts an amendment to §115.18, concerning Special Provisions Relating to Military Applicants, without changes to the proposed text as published in the September 17, 2021, issue of the Texas Register (46 TexReg 6011). The amended rule will not be republished.

The amendment implements the requirements of House Bill 139, passed by the 87th Legislature, Regular Session(2021), which amended the definition of "Armed Forces of the United States" in §55.001 of the Texas Occupations Code to add the Space Force as the newest branch of the Armed Forces and amended §55.004 of the Texas Occupations Code to allow military spouse applicants to establish Texas residency for occupational licensing purposes by providing copies of the military service member's change of station orders. The amendment aligns the requirements and procedures for military applicants to become registered as securities professionals with the updated sections of the Occupations Code.

The regulatory burdens of certain military service members and spouses, licensed in good standing as securities professionals in another state, who are relocating to Texas, are eased or reduced, and the amendment makes the rule consistent with Chapter 55 of the Occupations Code and the current structure of the Armed Forces of the United States.

No comments were received regarding adoption of the amendment.

The amendment is adopted under Texas Civil Statutes, Article 581-28-1 and §55.0041 of the Texas Occupations Code. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Section 55.0041 of the Texas Occupations Code requires a state agency that issues a license to adopt rules to implement §55.0041 and authorizes a state agency to adopt rules to provide for the issuance of a license to a military spouse to whom the agency provides confirmation under subsection (b)(3) of §55.0041.

The adopted amendment affects Texas Civil Statutes, Articles 581‑12, 581-13, 581-14, 581-15, 581-18, and 581-35.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on November 1, 2021.

TRD-202104388

Travis J. Iles

Securities Commissioner

State Securities Board

Effective date: November 21, 2021

Proposal publication date: September 17, 2021

For further information, please call: (512) 305-8303


CHAPTER 116. INVESTMENT ADVISERS AND INVESTMENT ADVISER REPRESENTATIVES.

7 TAC §116.18

The Texas State Securities Board adopts an amendment to §116.18, concerning Special Provisions Relating to Military Applicants, without changes to the proposed text as published in the September 17, 2021, issue of the Texas Register (46 TexReg 6012). The amended rule will not be republished.

The amendment implements the requirements of House Bill 139, passed by the 87th Legislature, Regular Session(2021), which amended the definition of "Armed Forces of the United States" in §55.001 of the Texas Occupations Code to add the Space Force as the newest branch of the Armed Forces and amended §55.004 of the Texas Occupations Code to allow military spouse applicants to establish Texas residency for occupational licensing purposes by providing copies of the military service member's change of station orders. The amendment aligns the requirements and procedures for military applicants to become registered as securities professionals with the updated sections of the Occupations Code.

The regulatory burdens of certain military service members and spouses, licensed in good standing as securities professionals in another state, who are relocating to Texas, are eased or reduced, and the amendment makes the rule consistent with Chapter 55 of the Occupations Code and the current structure of the Armed Forces of the United States.

No comments were received regarding adoption of the amendment.

The amendment is adopted under Texas Civil Statutes, Article 581-28-1 and §55.0041 of the Texas Occupations Code. Section 28-1 provides the Board with the authority to adopt rules and regulations necessary to carry out and implement the provisions of the Texas Securities Act, including rules and regulations governing registration statements and applications; defining terms; classifying securities, persons, and matters within its jurisdiction; and prescribing different requirements for different classes. Section 55.0041 of the Texas Occupations Code requires a state agency that issues a license to adopt rules to implement §55.0041 and authorizes a state agency to adopt rules to provide for the issuance of a license to a military spouse to whom the agency provides confirmation under subsection (b)(3) of §55.0041.

The adopted amendment affects Texas Civil Statutes, Articles 581‑12, 581-13, 581-14, 581-15, 581-18, and 581-35.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on November 1, 2021.

TRD-202104389

Travis J. Iles

Securities Commissioner

State Securities Board

Effective date: November 21, 2021

Proposal publication date: September 17, 2021

For further information, please call: (512) 305-8303