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← Series 63: Regulation of Broker-Dealers & Agents
Series 63 practice questionmediumSnowbird vs. Canadian Exemptions

All of the following are TRUE regarding the snowbird exemption and the Canadian broker-dealer exemption under the USA except:

  1. ABoth require that the client relationship predate the client’s presence in the state.
  2. BThe Canadian BD exemption allows for transactions with certain U.S. residents in Canada.✓ Correct answer
  3. CSnowbird exemption is available only to U.S.-based broker-dealers.
  4. DCanadian BDs must file a consent to service of process to qualify.
Explanation

Why B — The Canadian BD exemption allows for transactions with certain U.S. residents in Canada.

The Canadian BD exemption does NOT allow transactions with U.S. residents unless they're temporarily present in the U.S. (USA §401(b)(2)(B)); it's not for U.S. residents visiting Canada. Other statements correctly reflect the requirements of each exemption.

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