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Series 63 practice questionhardSecurities Registration — Qualification

In a remedial practice session, the fact pattern is framed this way. Read it as a Uniform Securities Act issue rather than a federal-law issue. A startup company wants to raise capital by selling shares exclusively within its home state. It has never issued securities before and has no federal registration. Which registration method must the issuer use at the state level?

  1. ARegistration by notification because the issuer is a new company
  2. BRegistration by coordination because all offerings must be filed with the SEC first
  3. CNo state registration is needed for intrastate offerings
  4. DRegistration by qualification because no federal registration statement is being filed✓ Correct answer
Explanation

Why D — Registration by qualification because no federal registration statement is being filed

Under USA Section 304, registration by qualification is required when an issuer is not filing a federal registration statement with the SEC. Since coordination requires a simultaneous SEC filing and notification/filing is reserved for established issuers with a track record, qualification is the appropriate method for a startup conducting a state-only offering. This version tests the same concept with a different fact pattern wrapper.

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