October 30, 2010
Per Rule 206(4)-5 under the Advisers Act, investment advisers registered with the Commission will not be permitted to pay state registered investment advisers to solicit government entities, as state registered advisers do not meet the definition of a regulated person under the rule. We would like to request clarification regarding whether entities registered with the Commission as municipal advisers will be subject to political contribution policies comparable to Rule 206(4)-5 and whether they might be permitted to act as solicitors to municipal advisers and government entities for compensation as regulated persons under Rule 206(4)-5. Please consider addressing this situation when crafting final rules for the registration of municipal advisers. Requiring municipal advisers to be subject to Rule 206(4)-5 may be an appropriate way for current state registered advisers (and advisers currently registered with the Commission who will be switching to state registration as a result of the Dodd-Frank Act) to act or continue to act in this capacity with the oversight of the Commission.