CITE

    15 USC Sec. 80a-7                                           01/05/2009

EXPCITE

    TITLE 15 - COMMERCE AND TRADE
    CHAPTER 2D - INVESTMENT COMPANIES AND ADVISERS
    SUBCHAPTER I - INVESTMENT COMPANIES

HEAD

    Sec. 80a-7. Transactions by unregistered investment companies

STATUTE

    (a) Prohibition of transactions in interstate commerce by companies
      No investment company organized or otherwise created under the
    laws of the United States or of a State and having a board of
    directors, unless registered under section 80a-8 of this title,
    shall directly or indirectly -
        (1) offer for sale, sell, or deliver after sale, by the use of
      the mails or any means or instrumentality of interstate commerce,
      any security or any interest in a security, whether the issuer of
      such security is such investment company or another person; or
      offer for sale, sell, or deliver after sale any such security or
      interest, having reason to believe that such security or interest
      will be made the subject of a public offering by use of the mails
      or any means or instrumentality of interstate commerce;
        (2) purchase, redeem, retire, or otherwise acquire or attempt
      to acquire, by use of the mails or any means or instrumentality
      of interstate commerce, any security or any interest in a
      security, whether the issuer of such security is such investment
      company or another person;
        (3) control any investment company which does any of the acts
      enumerated in paragraphs (1) and (2) of this subsection;
        (4) engage in any business in interstate commerce; or
        (5) control any company which is engaged in any business in
      interstate commerce.
    The provisions of this subsection shall not apply to transactions
    of an investment company which are merely incidental to its
    dissolution.
    (b) Prohibition of transactions in interstate commerce by
      depositors or trustees of companies
      No depositor or trustee of or underwriter for any investment
    company, organized or otherwise created under the laws of the
    United States or of a State and not having a board of directors,
    unless such company is registered under section 80a-8 of this title
    or exempt under section 80a-6 of this title, shall directly or
    indirectly -
        (1) offer for sale, sell, or deliver after sale, by use of the
      mails or any means or instrumentality of interstate commerce, any
      security or any interest in a security of which such company is
      the issuer; or offer for sale, sell, or deliver after sale any
      such security or interest, having reason to believe that such
      security or interest will be made the subject of a public
      offering by use of the mails or any means or instrumentality of
      interstate commerce;
        (2) purchase, redeem, or otherwise acquire or attempt to
      acquire, by use of the mails or any means or instrumentality of
      interstate commerce, any security or any interest in a security
      of which such company is the issuer; or
        (3) sell or purchase for the account of such company, by use of
      the mails or any means or instrumentality of interstate commerce,
      any security or interest in a security, by whomever issued.
    The provisions of this subsection shall not apply to transactions
    which are merely incidental to the dissolution of an investment
    company.
    (c) Prohibition of transactions in interstate commerce by promoters
      of proposed investment companies
      No promoter of a proposed investment company, and no underwriter
    for such a promoter, shall make use of the mails or any means or
    instrumentality of interstate commerce, directly or indirectly, to
    offer for sale, sell, or deliver after sale, in connection with a
    public offering, any preorganization certificate or subscription
    for such a company.
    (d) Prohibition of transactions in interstate commerce by companies
      not organized under laws of the United States or a State;
      exceptions
      No investment company, unless organized or otherwise created
    under the laws of the United States or of a State, and no depositor
    or trustee of or underwriter for such a company not so organized or
    created, shall make use of the mails or any means or
    instrumentality of interstate commerce, directly or indirectly, to
    offer for sale, sell, or deliver after sale, in connection with a
    public offering, any security of which such company is the issuer.
    Notwithstanding the provisions of this subsection and of section
    80a-8(a) of this title, the Commission is authorized, upon
    application by an investment company organized or otherwise created
    under the laws of a foreign country, to issue a conditional or
    unconditional order permitting such company to register under this
    subchapter, and to make a public offering of its securities by use
    of the mails and means or instrumentalities of interstate commerce,
    if the Commission finds that, by reason of special circumstances or
    arrangements, it is both legally and practically feasible
    effectively to enforce the provisions of this subchapter against
    such company and that the issuance of such order is otherwise
    consistent with the public interest and the protection of
    investors.
    (e) Disclosure by exempt charitable organizations
      Each fund that is excluded from the definition of an investment
    company under section 80a-3(c)(10)(B) of this title shall provide,
    to each donor to such fund, at the time of the donation or within
    90 days after December 8, 1995, whichever is later, written
    information describing the material terms of the operation of such
    fund.

SOURCE

    (Aug. 22, 1940, ch. 686, title I, Sec. 7, 54 Stat. 802; Pub. L. 104-
    62, Sec. 2(b), Dec. 8, 1995, 109 Stat. 683.)

AMENDMENTS

      1995 - Subsec. (e). Pub. L. 104-62 added subsec. (e).
                     EFFECTIVE DATE OF 1995 AMENDMENT
      Amendment by Pub. L. 104-62 applicable as defense to any claim in
    administrative and judicial actions pending on or commenced after
    Dec. 8, 1995, that any person, security, interest, or participation
    of type described in Pub. L. 104-62 is subject to the Securities
    Act of 1933, the Securities Exchange Act of 1934, the Investment
    Company Act of 1940, the Investment Advisers Act of 1940, or any
    State statute or regulation preempted as provided in section 80a-3a
    of this title, except as specifically provided in such statutes,
    see section 7 of Pub. L. 104-62, set out as a note under section
    77c of this title.

TRANSFER OF FUNCTIONS

      For transfer of functions of Securities and Exchange Commission,
    with certain exceptions, to Chairman of such Commission, see Reorg.
    Plan No. 10 of 1950, Secs. 1, 2, eff. May 24, 1950, 15 F.R. 3175,
    64 Stat. 1265, set out under section 78d of this title.