Series 63: 2.1.2.3 The Registration Process

2.1.2.3  The Registration Process

Broker-dealers must almost always register at the federal level, in addition to meeting state registration requirements. Registration is permitted only at the state level if all transactions and all aspects of the transactions are conducted or expected to be conducted within state boundaries. Additionally, broker-dealers that only transact in certain exempt securities are exempt from federal registration. All other broker-dealers, meaning the vast majority of firms, must register at both the federal and the state level.

To register federally, a broker-dealer must complete a two-step process. First, the BD must register with the SEC using the Central Depository Registration system to file a Form BD. This form requires important background information about the broker-dealer, including key personnel, contact information, and disclosures of any previous regulatory violations. The second step is to register with FINRA, which i