Quick Answer
Filing has the strictest eligibility but the lightest filing burden; coordination sits in the middle on both; qualification has no eligibility restrictions but the heaviest filing burden. Only qualification requires the Administrator to order effectiveness. Use the federal-registration and prior-qualification questions below to identify the right method on exam day.
This section is a deliberate synthesis, not new material: it recombines the rules from the individual method lessons into the comparisons and decision points the exam actually tests.
How Do the Three Methods Compare?
| Feature | Filing/Notification (302) | Coordination (303) | Qualification (304) |
|---|---|---|---|
| Federal registration required? | Yes | Yes | No |
| Eligibility restrictions? | Most restrictive (financial tests, operating history) | Broad (any security with federal registration) | None (any security) |
| Filing requirements | Least burdensome (basic eligibility statement + prospectus) | Moderate (copies of federal filings + undertaking) | Most burdensome (17 categories) |
| Effective date | Seasoned-issuer route: concurrent with federal (after 5 business days on file). Open-end fund and UIT route: business day of filing, or expiration of the existing registration, whichever is last | Concurrent with federal (after 10 days on file + 2 business days for the max/min price statement) | When Administrator orders |
| Escrow/impounding available? | No | Yes | Yes |
| Automatic effectiveness? | Yes (concurrent with federal on the seasoned-issuer route; on the fund route, automatic but keyed to filing rather than to federal effectiveness) | Yes (concurrent with federal) | No (Administrator's order only) |
| Primary users | Large, established public companies | Companies doing dual federal/state registration | Intrastate offerings; non-federally-registered offerings |
Exam Tip: Gotchas
- Only qualification becomes effective when the Administrator orders. Filing and coordination become effective automatically, without Administrator action. For coordination and for filing's seasoned-issuer route, that means concurrent with federal effectiveness; filing's open-end fund and UIT route is automatic on its own clock (business day of filing, or expiration of the existing registration, whichever is last), with no federal tie. If a question describes a state-registered offering becoming effective without Administrator action, it is filing or coordination, not qualification.
What Are the Key Time Periods to Memorize?
| Time Period | Method | Context |
|---|---|---|
| 5 business days on file | Registration by filing, seasoned-issuer route only | Time on file before effectiveness. The open-end fund and UIT route has no such wait |
| 10 days on file | Registration by coordination | Time on file before effectiveness |
| 2 full business days for the max/min proposed offering price statement | Registration by coordination | Pre-effective waiting period. This is not the federal price amendment |
| 1 year registration duration | All methods | Registration period length |
| 30 days to challenge effective registration | Stop orders (all methods) | Stop-order challenge window |
| 15 days to set a hearing after a written request | Stop orders (all methods) | Administrator's deadline to schedule the hearing following a summary suspension |
| 15 days after first sale for Reg D notice filing | Federal covered securities | State notice-filing window |
| Quarterly maximum reporting frequency | All methods | Maximum reporting cadence |
Which Method Should You Use?
- Is the security a federal covered security (exchange-listed; shares of an investment company that is registered, or has filed a registration statement, under the Investment Company Act; sold to a qualified purchaser; a specific SEC-defined exempt-offering category; or an offering under the uncapped Regulation D private-placement tier)?
- Yes: No state registration method applies at all. At most it owes a state notice filing (or nothing, if exchange-listed). Do not reach for qualification here: "no state registration" is not the same fact pattern as "no federal registration."
- No: Continue to the state registration methods below.
- Is the security being registered with the SEC?
- No: Must use qualification (the only state method without a federal filing requirement)
- Yes: Is it an open-end investment company or unit investment trust that either qualified its own securities in the state within the preceding 24 months, or (UIT only) whose sponsor previously registered a substantially identical UIT in the state?
- Yes: May use filing on the fund and UIT route. No financial tests apply to this route at all
- No: Does the issuer meet the strict financial tests for registration by filing?
- Yes: May use filing (simplest procedure) or coordination
- No: Must use coordination (or qualification, but coordination is simpler when a federal filing exists)
Exam Tip: Gotchas
Do not confuse "not federally registered" with "federal covered." A federal covered security (for example, an NYSE-listed stock or an offering under the uncapped Regulation D private-placement tier) skips state registration entirely, even though the reason is different for each category. Smaller-dollar Regulation D offerings are NOT federal covered and still need state registration or a state exemption. A security with no SEC registration and no covered-security status is what forces qualification, since qualification is the only state method that does not need an underlying federal filing.
Why Is There an Inverse Relationship Between Eligibility and Filing Burden?
There is a clear inverse relationship between eligibility difficulty and filing burden:
- Filing: Hardest to qualify for, easiest to file
- Coordination: Moderate eligibility, moderate filing
- Qualification: No eligibility restrictions, heaviest filing burden
Think of it this way: the more the issuer has already proven to regulators (through years of SEC reporting and financial strength), the less the state needs to review.
Exam Tip: Gotchas
The exam commonly presents a scenario and asks which registration method applies. Use these questions to narrow it down: (1) Is the security a federal covered security? If yes, no state registration method applies at all. (2) If not, is there a federal registration? If no, it must be qualification. (3) Is it an open-end fund or UIT that qualified in the state within the last 24 months, or a UIT whose sponsor previously registered a substantially identical UIT (no time limit on that branch)? If yes, filing is available on its own route, no financial tests. (4) Otherwise, does the issuer meet the strict filing-method thresholds? If no, it must be coordination. Also remember: qualification is the ONLY method where the Administrator controls when registration becomes effective.
What Should You Check on Exam Day?
- Work the decision tree in order: federal covered status first, then federal registration, then the fund/UIT prior-qualification test, then the seasoned-issuer financial thresholds.
- Match each time period to its method before answering: 5 business days for filing's seasoned-issuer route, 10 days plus 2 full business days for coordination.
- Confirm escrow and impounding availability (coordination and qualification, not filing) whenever a question compares methods on that dimension.
- Remember only qualification requires an Administrator's order; the other two methods become effective automatically once their conditions are met.