Registration Requirements

Now that you know who qualifies as an investment adviser representative (IAR), the next question is: where and how must they register?

Where Must an IAR Register?

IARs must register at the state level; there is no federal registration for IARs. Key requirements:

• Register in each state where the IAR has a place of business
• De minimis exemption (IARs of state-registered advisers only): without a place of business in a state, such an IAR need not register there as long as they have had no more than 5 non-institutional clients in that state during the preceding 12 months. IARs of federal covered advisers follow the place-of-business rule only; there is no client-count alternative for them.
• File Form U4 (Uniform Application for Securities Industry Registration or Transfer) through the Investment Adviser Registration Depository (IARD)/Web Central Registration Depository (CRD) system
• Provide consent to service of process (the irrevocable USA provision making the administrator the IAR's agent for legal papers): by filing, the IAR consents to the state administrator receiving legal documents on their behalf

Exam Tip: Gotchas

• The de minimis exemption requires BOTH conditions: no place of business in the state AND no more than 5 non-institutional clients there in the past 12 months. Exceeding the client count, or having an office in the state, defeats the exemption.
• This exemption applies only to IARs of state-registered advisers. An IAR of a federal covered adviser has no client-count alternative; place of business alone controls.

Qualifying Examinations

IARs may be required to pass one of these exam combinations:

• Option 1: Series 65 (Uniform Investment Adviser Law Examination), passed within the preceding 2 years
• Option 2: Series 66 (Uniform Combined State Law Examination) + Series 7, both passed within the preceding 2 years, plus the Securities Industry Essentials (SIE) passed within the preceding 4 years

Professional Designation Waivers

Under the NASAA Model Rule governing examination requirements for IARs, five professional designations waive the exam requirement. Holders of these credentials in good standing can skip the qualifying exam:

• CFA: Chartered Financial Analyst
• CFP: Certified Financial Planner
• ChFC: Chartered Financial Consultant
• PFS: Personal Financial Specialist
• CIMA: Certified Investment Management Analyst

Exam Tip: Gotchas

• Professional designation waivers excuse the exam, NOT the registration. If you hold a CFA or CFP, you can register as an IAR without taking the Series 65. However, you still must file Form U4 and register with the state.
• The list is five, and CIC is not on it. NASAA replaced CIC (Chartered Investment Counselor) with CIMA in May 2024, and the CIC program was discontinued in 2025. Older prep material still lists CIC; under the current model rule it does not waive anything.

Key Legal References

• The NASAA Model Rule on IAR registration: sets the specific registration requirements for IARs
• The NASAA Model Rule on IAR examinations and continuing education: sets the qualifying-exam requirements and professional-designation waivers

IARs of Federal Covered Advisers

Even when the advisory firm is SEC-registered, its individual IARs follow a different registration path:

• The adviser may be SEC-registered (federal covered), but the individual IARs must still comply with state registration requirements
• States have jurisdiction over IARs even when the adviser itself is federally registered
• The state cannot require the federal covered adviser to register, but it may still require notice filing and fees, and it always retains antifraud investigation and enforcement authority; separately, the state fully regulates the individual IARs

Think of it this way: The firm registers "up" (with the SEC), but the people register "down" (with the states).

Exam Tip: Gotchas

• An IAR of a federal covered adviser must still register with the state. The firm's federal registration does not exempt its individual representatives from state-level registration.
• There is no such thing as a "federal covered IAR." IARs always register at the state level, regardless of where their employer is registered.

Form U4

• Full name: Uniform Application for Securities Industry Registration or Transfer
• Filed through: IARD/Web CRD system (electronic filing)
• Used by: Both registered representatives (broker-dealer agents) and IARs
• Key disclosures: Employment history, disciplinary events, customer complaints, criminal history, financial disclosures
• Consent: Automatically grants consent to service of process (the irrevocable USA provision making the administrator the IAR's agent for legal papers)

Exam Tip: Gotchas

• Consent to service of process is automatic upon filing Form U4. There is no separate form; filing itself constitutes consent for the state administrator to receive legal documents on the IAR's behalf.

What Should You Check on Exam Day?

• Can you state the de minimis exemption's two conditions (no place of business, no more than 5 non-institutional clients in 12 months)?
• Do you know the two qualifying-exam paths and their validity windows (Series 65 within 2 years, or Series 66 plus Series 7 within 2 years plus the SIE within 4 years)?
• Can you name the five professional designations that waive the exam (CFA, CFP, ChFC, PFS, CIMA), and explain that a waiver excuses the exam but not the registration?
• Do you know why IARs of federal covered advisers still register at the state level, even though their employer is SEC-registered?
• Can you explain what consent to service of process means, and that it is automatic upon filing Form U4?