Published in the July 12, 2024, issue of the Texas Register
The State Securities Board (Board) adopts the review of the following chapters of Title 7, Part 7, of the Texas Administrative Code, in accordance with Texas Government Code, §2001.039, Agency Review of Existing Rules: Chapter 115, Securities Dealers and Agents, and Chapter 116, Investment Advisers and Investment Adviser Representatives. The text of these rules may be found in the Texas Administrative Code, Title 7, Part 7 or through the Board's website at www.ssb.texas.gov/texas-securities-act-board-rules.
Notice of the review of the chapters was published in the March 1, 2024, issue of the Texas Register (49 TexReg 1287). The Board received no comments concerning Chapter 115. The Board received two comments from interested parties concerning Chapter 116, Investment Advisers and Investment Adviser Representatives.
One comment was from a personal finance publication and the other was from an investment adviser firm that is registered in Texas. Both of the commenters expressed a desire for the Board to revise Chapter 116 to permit investment advisers registered in Texas to include testimonials in their advertisements, which is currently prohibited by Rule §116.15. The commenters also referred to recent changes to Securities and Exchange Commission (SEC) rules that now permit investment advisers that are registered with the SEC to use testimonials under certain circumstances, as long as they comply with the various requirements and conditions in the SEC rule.
State Securities Board staff agrees with this suggestion and plans to draft one or more amendments to the rules in Chapter 116 to be approved for publication and comment for this purpose at a future board meeting. In addition, staff has identified other changes that should be made to various sections within Chapters 115 and 116. These revisions will be proposed in a future issue of the Texas Register.
The Board has reviewed and considered for readoption, revision, or repeal all sections of these two chapters, and considered, among other things, whether the reasons for adoption of these rules continue to exist. After its review, the Board finds that the reasons for adopting these rules continue to exist and readopts these chapters, without changes, pursuant to the requirements of the Texas Government Code.
This concludes the review of 7 TAC Chapters 115 and 116.
Issued in Austin, Texas on June 28, 2024.
TRD-202402898
Travis J. Iles
Securities Commissioner
State Securities Board
Filed: June 28, 2024