SEC Issues Final Rule Related to Definitions of “Dealer” and “Government Securities Dealer”

The SEC has released a final rule that amends the Securities Exchange Act of 1934 to broaden the scope of the definitions of “dealer” and “government securities dealer” in Exchange Act Sections 3(a)(5) and 3(a)(44). Specifically, the final rule identifies certain additional activities that, if engaged in as part of an entity’s regular business, would cause an entity to be a dealer or government securities dealer and therefore be “subject to the registration requirements” of the Exchange Act in the absence of “an exception or exemption.” Such market participants would be required to “register with the SEC, become members of a self-regulatory organization . . . , and comply with federal securities laws and regulatory obligations.”

For more information, see the press release and fact sheet — as well as the statements by SEC Chair Gary Gensler and Commissioners Hester Peirce, Caroline Crenshaw, Mark Uyeda, and Jaime Lizárraga — on the SEC’s Web site.