Series 63 practice questionmediumunique treatment of municipal securities
Which is LEAST likely to be exempt from state registration under the USA?
- AA revenue bond issued by a U.S. city
- BA general obligation bond issued by a territory of the U.S.
- CA bond issued by a U.S. political subdivision for the benefit of a private corporation✓ Correct answer
- DA municipal bond issued by a Canadian city
Explanation
Why C — A bond issued by a U.S. political subdivision for the benefit of a private corporation
U.S. municipal obligations and valid obligations of Canada, Canadian provinces, and their political subdivisions are exempt. The governmental exemption generally excludes an industrial revenue obligation when payments are derived from a nongovernmental industrial or commercial enterprise, unless another exemption applies.
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