February 28, 1990
TO: STATE SECURITIES MEMBERS NO. 3-90
UNIT INVESTMENT TRUST MEMBERS NO. 14-90
SMALL FUNDS COMMITTEE NO. 5-90
RE: COMMENTS ON OHIO'S PROPOSED OVERSALE SOLUTION
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The Institute has actively been working with the Ohio
Securities Division and the Ohio Enforcement Advisory Committee
to develop a solution for oversales of securities of mutual funds
and unit investment trusts. Ohio has required rescission offers
to be made upon the occurrence of an oversale of a mutual fund or
unit trust. (See Memo to State Securities Members No. 25-88,
Unit Investment Trust Members No. 59-88 and Small Funds Committee
No. 6-88, dated September 12, 1988.)
The Commissioner of the Ohio Division of Securities
recently asked for input regarding implementation of a flat
registration fee of $750.00 as a possible solution to the
oversales problem. The Institute suggested that Ohio adopt an
indefinite registration procedure wherein the fee is based upon
sales made in Ohio during an issuer's fiscal year. In the
alternative, or in conjunction with an indefinite registration
procedure, the Institute suggested that Ohio adopt a blue chip
exemption for qualified mutual funds and unit investment trusts.
Attached is a copy of the Institute's comment letter. We
will keep you further informed of any developments.
Patricia Louie
Assistant General Counsel
Attachment