Series 63 practice questioneasySuccessor Firm Registration
A broker-dealer is acquired by another firm. Under the USA, how can the successor firm continue business without interruption?
- AThe successor must file a new application and await effectiveness.
- BThe successor may file an application for registration, which becomes effective immediately for the unexpired portion of the year.✓ Correct answer
- CThe successor can use the previous firm's registration indefinitely.
- DNo action is necessary; registration transfers automatically.
Explanation
Why B — The successor may file an application for registration, which becomes effective immediately for the unexpired portion of the year.
The USA (Section 406(f)) allows a successor firm to file for registration, becoming immediately effective for the remainder of the year. Other options do not meet this requirement or are incorrect regarding transferability.
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