SIE practice questionmediumRegulation S and Offshore Accounts
A U.S. company sells new securities in an account outside the U.S. under Regulation S. What is TRUE?
- AThe securities are not subject to U.S. registration requirements.✓ Correct answer
- BAll purchases must be by U.S. citizens.
- CThe offering must be registered with the SEC.
- DOnly mutual funds can use Regulation S.
Explanation
Why A — The securities are not subject to U.S. registration requirements.
Regulation S allows securities sold exclusively offshore to be exempt from U.S. registration. B is false—non-U.S. investors can buy. C is incorrect—no registration is needed under S. D is false—other issuers can use it too.
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