Series 63 practice questioneasyExempt Transactions — Isolated Non-Issuer Transactions
During a registration workshop, the instructor adds this setup first. Treat the facts as a straight Series 63 application question. Under the Uniform Securities Act, an isolated non-issuer transaction is:
- AA transaction where the issuer sells shares directly to the public
- BAn occasional transaction by a person who is not the issuer, an underwriter, or a dealer✓ Correct answer
- CA transaction involving a new issue of securities
- DA transaction executed on a national securities exchange
Explanation
Why B — An occasional transaction by a person who is not the issuer, an underwriter, or a dealer
Under USA Section 402(b), isolated non-issuer transactions are exempt from registration. These are secondary market transactions that occur infrequently and do not involve the issuer, an underwriter, or a dealer. The key elements are that the transaction is isolated (not part of repeated or successive transactions) and the seller is not the issuer. The governing USA principle is unchanged even though the framing is different.
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