Series 63 practice questionmediumBD Registration and Federal Covered BD
A broker-dealer is registered with the SEC as a federal covered BD but has an office in State Y. Under the USA, which is TRUE?
- AThe firm must still register in State Y.✓ Correct answer
- BFederal registration preempts state registration.
- CState Y can require notice filing but not registration.
- DState Y can require registration only if the BD sells to retail clients.
Explanation
Why A — The firm must still register in State Y.
Broker-dealers register federally and also register in each state where state registration is required. The federal-covered-adviser preemption and state notice-filing framework does not apply to broker-dealers, so A is correct.
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