Maine § 16401. - Broker-dealer licensing requirement and exemptions
Full text of Maine Maine Revised Statutes § 16401. — Broker-dealer licensing requirement and exemptions, with citation guidance and answers to common questions.
§ 16401.. Broker-dealer licensing requirement and exemptions
1. Licensing requirement. It is unlawful for a person to transact business in this State as a broker-dealer unless the person is licensed under this chapter as a broker-dealer or is exempt from licensing as a broker-dealer under subsection 2 or 4.
2. Exemptions from licensing. The following persons are exempt from the licensing requirement of subsection 1:
A. A broker-dealer without a place of business in this State if its only transactions effected in this State are with:
(2) A broker-dealer licensed as a broker-dealer under this chapter or not required to be licensed as a broker-dealer under this chapter, except when the person is acting as a clearing broker-dealer;
(3) An institutional investor;
(4) A nonaffiliated federal covered investment adviser with investments under management in excess of $100,000,000 acting for the account of others pursuant to discretionary authority in a signed record;
(5) A bona fide preexisting customer whose principal place of residence is not in this State and the person is registered as a broker-dealer under the federal Securities Exchange Act of 1934 or not required to be registered under the federal Securities Exchange Act of 1934 and is registered or licensed under the securities act of the state in which the customer maintains a principal place of residence;
(6) A bona fide preexisting customer whose principal place of residence is in this State but was not present in this State when the customer relationship was established, if:
(b) Within 45 days after the customer's first transaction in this State, the person files an application for licensing as a broker-dealer in this State and no further transactions are effected until the license is effective. Any broker-dealer may seek an order granting a temporary exemption under subparagraph (7) while the application is pending; and
(7) Any other person exempted by rule adopted or order issued under this chapter; and [PL 2005, c. 65, Pt. A, §2 (NEW).]
B. A person that deals solely in United States government securities and is supervised as a dealer in government securities by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation or the United States Department of the Treasury, Office of Thrift Supervision or Comptroller of the Currency. [PL 2005, c. 65, Pt. A, §2 (NEW).]
3. Limits on employment or association. It is unlawful for a broker-dealer, or for an issuer engaged in offering, offering to purchase, purchasing or selling securities in this State, directly or indirectly, to employ or associate with an individual to engage in an activity related to securities transactions in this State if the license of the individual is suspended or revoked or the individual is barred from employment or association with a broker-dealer, an issuer, an investment adviser or a federal covered investment adviser by an order of the administrator under this chapter, the Securities and Exchange Commission or a self-regulatory organization. A broker-dealer or issuer does not violate this subsection if the broker-dealer or issuer sustains the burden of proof that the broker-dealer or issuer did not know and in the exercise of reasonable care could not have known of the suspension, revocation or bar. Upon request from a broker-dealer or issuer and for good cause, an order under this chapter may modify or waive, in whole or in part, the application of the prohibitions of this subsection to the broker-dealer.
4. Foreign transactions. A rule adopted or order issued under this chapter may permit:
A. A broker-dealer that is registered or licensed in Canada or other foreign jurisdiction and that does not have a place of business in this State to effect transactions in securities with or for, or attempt to effect the purchase or sale of any securities by:
(2) An individual from Canada or other foreign jurisdiction who is present in this State and whose transactions are in a self-directed tax advantaged retirement plan of which the individual is the holder or contributor in that foreign jurisdiction; or
(3) An individual who is present in this State with whom the broker-dealer customer relationship arose while the individual was temporarily or permanently resident in Canada or the other foreign jurisdiction; and [PL 2005, c. 65, Pt. A, §2 (NEW).]
B. An agent who represents a broker-dealer that is exempt under this subsection to effect transactions in securities or attempt to effect the purchase or sale of securities in this State as permitted for a broker-dealer described in paragraph A. [PL 2005, c. 65, Pt. A, §2 (NEW).]
5. Rulemaking. Rules adopted pursuant to this section are routine technical rules as defined in Title 5, chapter 375, subchapter 2‑A.
Source: official Maine text · Last verified 2026-08-27
Frequently Asked Questions About Maine § 16401.
What does Maine Revised Statutes § 16401. cover?
Section 16401. ("Broker-dealer licensing requirement and exemptions") is part of the Maine Revised Statutes, the codified statutory law of Maine. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Maine § 16401.?
A common citation format is "Maine Revised Statutes § 16401." (Maine). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Maine law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Maine official source linked on this page or consult a licensed Maine attorney.
How does Maine § 16401. apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Maine can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Maine.