Are sales literature that pertains to federal-covered securities subject to filing with the state?

Sales literature related to federal-covered securities is not required to be filed with state regulators. Federal-covered securities are defined under the National Securities Markets Improvement Act (NSMIA) as those securities that are registered with the SEC or that are issued by certain issuers such as investment companies or state and municipal governments. Because these securities are already regulated at the federal level, state regulators do not have the authority to impose additional filing requirements for sales literature.

This exemption is designed to facilitate the sale and promotion of securities that are considered to have a uniform standard of disclosure as provided by federal laws. As a result, firms marketing federal-covered securities can operate without needing to navigate the varying requirements of each state concerning sales literature filings, making compliance simpler and more efficient.

Filing requirements typically apply to state-regulated securities where states maintain jurisdiction over such matters. However, because federal-covered securities have their disclosures vetted at the federal level, there is no necessity for states to duplicate this process through additional filings.