Current through February 27, 2024
1.
Except as otherwise provided in this section, an investment adviser who is
licensed or required to be licensed pursuant to
NRS
90.330 shall furnish each designated client
and designated prospective client with:
(a) A
brochure which may be a copy of Part 2A of the Uniform Application for
Investment Adviser Registration (Form ADV) or written documents containing the
information required by Part 2A of the Uniform Application for Investment
Adviser Registration (Form ADV);
(b) A copy of its Part 2B brochure supplement
for each person who:
(1) Provides investment
advice and has direct contact with clients in this State; or
(2) Exercises discretion over assets of
clients in this State, even if no direct contact is involved;
(c) A copy of its Part 2A,
Appendix 1 wrap fee brochure if the investment adviser sponsors or participates
in a wrap fee account;
(d) A
summary of material changes to the documents described in paragraph (a), (b) or
(c), which may be:
(1) Included in Part 2 of
its Uniform Application for Investment Adviser Registration (Form ADV);
or
(2) Given as a separate
document; and
(e) Any
other information required by the Administrator.
2. The brochure described in paragraph (a) of
subsection 1 must comply with the language, organizational format and filing
requirements specified in the instructions to Part 2 of the Uniform Application
for Investment Adviser Registration (Form ADV).
3. An investment adviser shall deliver the
brochure described in paragraph (a) of subsection 1 and any other documents
required by this section to each designated prospective client:
(a) Not less than 48 hours before entering
into an advisory contract with the designated prospective client; or
(b) At the time of entering into the
contract, if the designated client has a right to terminate the contract
without penalty within 5 business days after entering into the
contract.
4. An
investment adviser, within 120 days after the end of its fiscal year, shall
deliver to a designated client:
(a) Any
updates to the brochure described in paragraph (a) of subsection 1 and any
other information required by subsection 1; or
(b) A summary of the material changes to the
documents described in subsection 1, including, without limitation:
(1) Any offer to provide a copy of the
updated brochure and supplements; and
(2) Information relating to how the client
may obtain a copy of the brochure, supplements and any other information
required by subsection 1.
5. An investment adviser may electronically
deliver the brochure described in paragraph (a) of subsection 1 and any related
supplements required by subsection 1 if the investment adviser:
(a) In the case of an initial delivery to a
designated prospective client, obtains a verification that a readable copy of
the brochure and supplements were received by the designated prospective
client;
(b) In any case other than
the initial delivery, obtains the prior consent of the designated client to
provide the brochure, supplements and other information
electronically;
(c) Prepares the
brochure, supplements and other information in the format described in this
section;
(d) Electronically
delivers the brochure, supplements and other information in a format that can
be retained by the client in either electronic or paper form; and
(e) Establishes procedures to:
(1) Supervise personnel transmitting the
brochure, supplements and other information; and
(2) Prevent violations of this
section.
6.
Nothing in this section shall relieve an investment adviser from any other
obligation described in any provision of chapter 90 of NRS or the rules and
regulations thereunder or other federal or state law to disclose information to
its designated clients or prospective designated clients.
7. As used in this section:
(a) "Advisory contract" means any contract
relating solely to the provision of investment advisory services:
(1) By means of written material or oral
statements which do not purport to meet the objectives or needs of specific
individuals or accounts;
(2)
Through the issuance of statistical information which does not contain any
expression of opinion as to the investment merits of a particular security;
or
(3) By any combination of the
foregoing services.
(b)
"Designated client" or "designated prospective client" means a client or
prospective client who:
(1) Receives only
impersonal advice and who pays less than $500 in fees per year;
(2) Is an investment company registered under
the Investment Company Act of 1940; or
(3) Is a business development company, as
defined in the Investment Company Act of 1940, and whose advisory contract
meets the requirements of section 15(c) of the Act.
(c) "Entering into," in reference to an
advisory contract, does not include an extension or renewal without a material
change of any such contract which is in effect immediately before such
extension or renewal.
Added
to NAC by Sec'y of State by
R018-21A,
eff. 6/2/2023
NRS
90.390,
90.750
