N.M. Code R. § 12.11.2.20

Current through Register Vol. 35, No. 11, June 11, 2024

Section 12.11.2.20 - USE OF INTERNET FOR GENERAL DISSEMINATION OF INFORMATION ON PRODUCTS AND SERVICES

A. Broker-dealers and agents who use the internet to distribute information on available products and services through communications made on the internet directed generally to anyone having access to the internet and transmitted through internet communications shall not be considered to be "transacting business" in this state for purposes of Sections 58-13C-401 A and 58-13C-402 A of the New Mexico Uniform Securities Act based solely on that fact, provided that:

(1) the internet communication contains a legend in which it is clearly stated that:

(a) the broker-dealer or agent in question may only transact business in this state if first registered, excluded, or exempted from state broker-dealer or agent registration requirements; and

(b) follow-up, individualized responses to persons in this state by the broker-dealer or agent that involve either effecting or attempting to effect transactions in securities, or rendering of personalized investment advice for compensation, will not be made without compliance with broker-dealer or agent registration requirements, or an applicable exemption or exclusion;

(2) the internet communication contains a mechanism which includes, but is not limited to, technical "firewalls" or other implemented policies and procedures, designed reasonably to ensure that before any subsequent, direct communication with prospective customers or clients in this state, the broker-dealer and agent are first registered in this state or qualify for an exemption or exclusion from the registration requirement;

(3) the internet communication is limited to the dissemination of general information on products and services and does not involve either effecting or attempting to effect transactions in securities, or rendering personalized investment advice for compensation in this state over the internet; and

(4) with respect to broker-dealer or agent internet communications:

(a) the broker-dealer affiliation of the agent is prominently disclosed within the internet communication;

(b) the broker-dealer with whom the agent is associated retains responsibility for reviewing and approving the content of any internet communication by agent;

(c) the broker-dealer with whom the agent is associated first authorizes the distribution of information on the particular products and services through the internet communication; and

(d) when disseminating information through the internet communication, the agent acts within the scope of the authority granted by the broker-dealer.

B. This rule extends to state broker-dealer and agent registration requirements only, and does not excuse compliance with applicable securities registration, antifraud or related provisions.

C. Nothing in this rule shall be construed to affect the activities of any broker-dealer or agent engaged in business in this state that is not subject to the jurisdiction of the director as provided in the National Securities Markets Improvements Act of 1996, as amended.

N.M. Code R. § 12.11.2.20

12.11.2.20 NMAC - Rp, 12.11.2.20 NMAC, 1-1-2010